Written by Ged Cosgrove, group managing partner
It was originally suggested that we wouldn’t feel the true impact of the pandemic and Brexit on the economy for years to come. Since then, we’ve had to contend with the conflict in Ukraine and the knock-on effect this is having on supply chains around the world. Collectively, these are creating a challenging landscape for businesses that are now faced with rising costs across the board.
From steeply rising interest rates to surges in the price of materials, and soaring energy costs to demand from employees for higher wages to cope with the cost of living. Business owners today are having to contend with additional expenses while striving to remain operational – and it’s eating into profits at a faster rate than ever before.
In recent weeks, the Federation of Small Businesses (FSB) has urged the Government to act quickly to ‘stem the tide’ of businesses going to the wall. They point out that forcing small businesses to cope with such financial pressure without additional support is unfair, considering so many have suffered throughout the course of the pandemic.
In particular, the FSB has called for a reversal of the increases to National Insurance Contributions, a reduction in business rates, cuts to VAT – especially on energy – and targeted reductions in fuel duty for those businesses in rural areas that ‘have no choice but to use the roads’.
Whether any of these suggested initiatives are introduced by Government remains to be seen – especially as we still have several weeks to go before our new Prime Minister is announced. But in the meantime, businesses should take any steps possible to prioritise strategic financial planning and create realistic forecasts as costs continue to creep up.
Working with an expert advisor can help identify where savings can be made to offset increased prices and unlock other capital, which can then be used to support areas of the business that might be struggling. Creating a forecast today can help ensure you are prepared for the increases we know are coming and are better armed for those that are less predictable.
If this sounds like something your business needs, get in touch with your Champion advisor today.
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