More than a quarter of larger UK businesses are concerned that international conflict will disrupt their supply chains during the next year, according to new official data showing a sharp increase in geopolitical risk since 2025.
The latest Business Insights and Conditions Survey from the Office for National Statistics found that 28% of businesses with 10 or more employees were concerned about international conflict affecting their supply chains.
A further 21% reported concern about disruption to shipping. Both figures were broadly unchanged from July, but the proportion citing international conflict was 17 percentage points higher than in September 2025, while shipping concerns were 12 percentage points higher.
The figures show geopolitical disruption becoming a more established operating consideration rather than a response to a single event. Companies have spent much of the past decade adjusting supply chains following Brexit, the pandemic, disruption in the Red Sea, commodity volatility, and repeated changes in trade policy. International conflict now occupies a substantially larger place in business risk assessments than a year ago.
The survey covers a period in which conflict in the Middle East has increased pressure on energy and transport markets. Shipping disruption can raise freight costs, extend delivery times, and change the economics of overseas sourcing even where goods themselves remain available.
Earlier ONS data showed how those effects could reach businesses. In late July, 52% of companies with 10 or more employees that reported supply chain concerns expected the cost of sourcing materials to be affected, while 47% expected transportation costs to be affected.
Exposure varies considerably by sector. Manufacturers, wholesalers, retailers, construction businesses, and organisations dependent on imported components can face direct procurement consequences. Service companies remain exposed through equipment, technology hardware, energy costs, and suppliers further down the chain.
Larger organisations can respond through inventory planning, supplier diversification, revised contracts, and closer monitoring of shipping routes, although each measure carries a cost. Holding additional inventory ties up working capital, alternative suppliers may be more expensive, and bringing production closer to end markets can require substantial investment.
The trade-off has become central to supply chain strategy. Highly efficient sourcing models can leave companies exposed when transport lanes, energy markets, tariffs, or international relationships change rapidly. Maintaining spare capacity and duplicated suppliers, by contrast, raises costs during periods when disruption does not materialise.
The ONS survey also provides a broader measure of operating conditions. In late August, 95% of responding businesses said they were trading, with 85% fully trading and 10% operating partially. Three per cent reported having temporarily paused trading, while 2% said they had permanently ceased.
Continued trading does not eliminate the commercial effect of disrupted supply. Companies can remain operational while absorbing higher freight charges, delaying orders, substituting materials, or passing increased costs to customers. Pressure can therefore emerge through margins and prices well before it appears in headline trading status.
Supply chain costs also feed into the inflation outlook. Higher transport, commodity, and materials costs can move through production networks before appearing in consumer prices. The Bank of England is currently examining the transmission of higher energy costs and whether businesses have enough demand to pass those increases through.
The year-on-year movement in the ONS figures indicates that geopolitical exposure has broadened significantly. Concern has also remained broadly stable since July, suggesting international conflict and shipping reliability are being treated as medium-term planning issues rather than short-lived disruption.
The next indication will come from the effect on sourcing costs, lead times, inventories, and investment. With nearly three in ten larger businesses now identifying international conflict as a supply chain concern, geopolitical risk is increasingly embedded in routine operational planning across the UK economy.
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