As we step into 2026, many organisations will be eager to put a year of economic uncertainty behind them and seize the opportunities ahead. And despite pessimism in some quarters, there are several signs of grounds for greater positivity.
Research in and around the festive period offers cause for optimism. For example, an HSBC survey of business founders revealed that 75% of UK-based entrepreneurs were positive about the business outlook – the highest proportion anywhere in the world.
And while some quarterly surveys still indicate UK business sentiment remains in the doldrums, those that report monthly show positive movement after the Budget – suggesting that once the uncertainty surrounding the protracted build-up lifted, business leaders ramped up activity and investment. Lloyds’ Business Confidence Barometer rose by five percentage points in December, buoyed by the interest rate cut in the same month.
Supermarkets reportedly brought in a record £13.8bn in the four weeks to 28 December – giving the sector a much-needed boost to end the year on a high.
Even the London Stock Exchange is showing signs of revival, with a flurry of listings towards the end of the year (and the prospect of more to come), after what had been a real drought. Last week, the FTSE 100 topped 10,000 points for the first time in a New Year rally.
What will really make the difference is service
We know, however, despite these positive indicators, challenges remain. Since 2020, 480,000 UK businesses have gone bust, and unemployment is creeping upwards. This can really dent consumer confidence, which is probably why a recent KPMG survey found that consumers were holding off on spending – especially on ‘big ticket’ items – due to economic concerns.
However, data which we will release later this month indicates that many consumers are feeling positive about their own financial wellbeing, while remaining concerned about the overall economic environment.
Something that might start to shift the dial on consumer sentiment is falling mortgage rates, following December’s base rate cut. HSBC became the first bank since to cut its mortgage rates, and we will surely see others follow. One factor that may encourage customers to spend, and which is firmly in our control, is boosting service levels. The Institute’s research shows that more than one in three customers will pay more in return for excellent service. In addition, when making those bigger purchases, 83% of customers say the standard of service is important, with 42% strongly holding this view.
Ultimately, when pockets are tight, consumers are more likely to look to experiences that boost their mood and treat themselves to what they are confident will be a reliably good experience, be that some retail therapy, a favourite restaurant, or a family outing to a trusted venue.
Making 2026 the year of the customer
As we prepare for the next twelve months, I would urge all service-oriented organisations to take their futures into their own hands by investing in honing their service proposition. What are your service priorities, and how are you going to achieve them? What is your plan to spot and eliminate points of friction in the customer journey, incorporate feedback, and make customers feel valued? Investing in finding the right fusion of tech, AI and human will be critical.
There is always uncertainty – and we will all have difficult decisions to make in the coming weeks and months. However, fortune favours the brave, and whatever your plans for 2026, focusing on an authentic customer experience – with a genuinely committed leadership team that understands the importance of service culture and clarity of purpose – will help you navigate the volatility and lead the charge for a stronger 2026.
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