A few businesses find one man's poison is another man's meat

While the austerity measures that are starting to be announced by the Government are being met with dread by most companies, for some the spending cuts are just what the doctor ordered.

Groups that offer so-called business process outsourcing (BPO) – performing tasks cheaper than the Government can do them itself – are said to be looking forward to many of the expected cuts. Sources close to Capita, the FTSE 100 company that specialises in BPO work, say that the group is gearing up to offer its services to both central and local government departments, which have been told by the Treasury to strip budgets.

Outsourcing groups that work on a variety of infrastructure projects are likely to struggle, as programmes such as the Government's Building Schools for the Future are pared back. But the fiscal tightening is not likely to affect groups such as Babcock, which work under vital contracts, including the maintenance of nuclear facilities.

Similarly, Serco, another outsourcing company, which runs vital services such as London's Docklands Light Railway, on Monday penned a deal to build and run a new prison in the capital, another vital service. Contract wins like the prison deal will be vital to companies like Serco, which has lost nearly 10 per cent of its value since the Government began outlining the areas it was preparing to curtail.

Retailers will be hit indirectly by the cuts, as consumers that work in the public sector – and there are a lot of them – lose their jobs or decide to save in case the axe should fall in their direction. The nation's shops will also be at the coalface, dealing with the planned VAT increase.

But for some, the austerity measures are an opportunity to gain market share. Groups that sell food are seen as defensive when the economic squeeze is on, and the evidence points to the discount supermarkets, such as Lidl and Aldi, enjoying increased sales and market share when we hit a recession.

Of course, there is a good chance we will avoid a much feared double-dip downturn, but the discount groups will no doubt be looking forward to cashing in on people's limited spending power.

During the recent economic downturn Aldi enjoyed a 25.7 per cent sales increase in the 12 weeks leading up to Christmas in 2008.

Lidl's sales soared by 11.2 per cent in the same period, and both saw sales increases return to something close to 2 per cent once the recovery began.

Suggested Topics
News
peopleFrankie Boyle responds to referendum result in characteristically offensive style
Sport
Lewis Hamilton will start the Singapore Grand Prix from pole, with Nico Rosberg second and Daniel Ricciardo third
F1... for floodlit Singapore Grand Prix
Arts and Entertainment
'New Tricks' star Dennis Waterman is departing from the show after he completes filming on two more episodes
tvHe is only remaining member of original cast
Arts and Entertainment
tvHighs and lows of the cast's careers since 2004
PROMOTED VIDEO
Sport
Gabriel Agbonlahor, Alexis Sanchez, Alan Pardew and Graziano Pelle
footballAfter QPR draw, follow Villa vs Arsenal, Newcastle vs Hull and Swansea vs Southampton
New Articles
i100... she's just started school
News
news
News
ebooksAn unforgettable anthology of contemporary reportage
New Articles
i100
Life and Style
Couples have been having sex less in 2014, according to a new survey
life
Arts and Entertainment
musicBiographer Hunter Davies has collected nearly a hundred original manuscripts
New Articles
i100... despite rising prices
Voices
Holly's review of Peterborough's Pizza Express quickly went viral on social media
voices
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Senior BA - Motor and Home Insurance

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Market Risk & Control Manager

Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Day In a Page

Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam