This morning at 11am, Ofgem announced a price cap rise of 54% for England, Wales and Scotland, which will come into effect in April. PR platform Newspage asked small businesses for their views and experiences.
19 responses from the Newspage community
"As a small business, the UK is becoming an increasingly difficult country to operate in. Our supplier costs are inevitably going to increase due to the cost of production going up as a result of the energy price increases, so the price for customers will also have to increase, making it a lot harder to remain competitive. We specialise in affordable gifts to comfort and empower people but affordability is being stretched to the limit. First the pandemic and now an energy and cost of living crisis. It's brutal out there."
"Having clawed my way out of food bank poverty, here I am, three years on, running my business wrapped in a blanket. This sharp increase in energy prices is a massive blow to businesses and people around the UK."
"I'm gravely concerned about the rise in energy prices. Running a small business from home that relies on electricity to run my 3D printers, my business overheads have an impact on my family budget. I shopped around for a good renewable energy supplier but I am currently unsure if they will be raising their prices. Right now my electricity bill is exactly half the price of my monthly mortgage cost. If it goes any higher it will have a huge impact on our family budget. "I feel that the continual energy price rises haven't been monitored or regulated sufficiently. Energy companies, especially the large ones with a monopoly, are exploiting UK consumers. Being able to heat your home or cook your meals shouldn't be a luxury that only a select few can afford."
"Like millions of others, I now work permanently from home, which means using more energy, especially during the winter months. I switched to a sustainable energy provider during the pandemic, with the promise of a better deal. But already, monthly payments have increased from £100 to £150. And that's before April's price rises kick in. You can't help but wonder why the government didn't have the foresight to invest much more heavily in renewables long ago. With the highest levels of wind, wave and tidal potential in Europe, it feels like a squandered opportunity to create a more stable and affordable national energy supply. Roll on Spring, so the heating can be switched off."
"RIP the self-employed and sole traders. This price rise is going to kill small businesses. Such a massive rise will hit the pockets of the lower income families and those who like myself are disabled and need to have constant heat in the home. For those people and myself there is no choice between eat or heat. It's go hungry to stay safe."
"The staggering speed of the rises has blown us away as a business. We took action over the new year to reduce the size of the sales team, which gives us some headway with costs but it will have a long-term impact on our growth as less people equal less income. We are holding off purchasing electric vehicles due to the cost increase, which impacts our green credentials, which in turn will affect some of our sales opportunities that require such actions. At the moment I couldn't feel the Government could care any less about businesses as it stumbles from one shambles to another."
"For many people, it is a case of eat or heat. The fact that we're in this position, after two years of the pandemic, is a disaster. As a country, we are going backwards. How much longer can we be pushed into a corner, while the elites watch on, scoffingly? The government is simply not doing enough to help everyday people. Just look at the quiet high streets of the UK, they tell you all you need to know about what's happening."
"How much more can people take? The cost of living has had a massive knock-on effect on the food and clothing I can buy. And that's before the rise in National Insurance and energy prices. The Government has got its head stuck in the sand. Right now, I cannot see a way out and nor can many other working families."
"Once again, households and small businesses have to take a seat on the see-saw of uncertainty. Energy prices rises, the soaring cost of living and interest rate increases are putting a phenomenal amount of pressure on us. As a small business, if we increase our prices to reflect the price rises we incur, we risk losing customers to the bigger businesses who can absorb the rises. If we don't put our prices up, our margins are squeezed even further, which means we struggle to be viable. The cost of living squeeze has been devastating in recent months, whether in the form of food and fuel price rises or raw materials, the list goes on. We're now back on that see-saw yet again. The average business is being squeezed from all sides."
"The rise in the energy price cap will not only affect us all personally but is possibly the final nail in the coffin for the beauty industry. Customers will have less disposable funds to spend on non-essential purchases. We are struggling to earn enough to heat our own homes and it looks set to get worse. Our industry has had no government help since Covid began and now the energy crisis is going to be another pandemic for the personal care industry. The whole outlook is bleak."
"The energy cap rise will inevitably make it harder for people to get a mortgage. All lenders will factor this increase and other price rises such as food and fuel into affordability calculations. With interest rates also likely to rise this week, we could well see house prices fall within a few months."
"We seem to be in a needless state of self-flagellation. I don't see how making the poor poorer, offshoring manufacturing jobs (and carbon), and becoming dependent on Russia and Qatar for energy imports helps anything? It doesn't make us greener or our lives better. I say this as someone who wants to see greater sustainability but I think we're going about this the wrong way. The government needs to urgently reconsider its energy policies and roadmap to sustainability."
"My business was lucky in that we signed a two-year fixed rate energy deal last summer. However, I'm very concerned that many other businesses, and the general public will struggle to pay their new higher energy bills. I think the government needs to reconsider its planned National Insurance rise given the financial challenges UK businesses and the public are facing at the moment."
"As a mental health professional, I am concerned about the impact a massive hike in energy prices will have on our society's most vulnerable. Benefits and other income are not rising to cover these increases and as such people's quality of life and therefore mental health is likely to suffer. This is a big deal for older adults, low income families and people with disabilities. It means there will be less money around to help smooth over the bumps in life and at a time where there are a fair few craters in the road, let alone bumps, this is potentially going to have a massive impact on people."
"The latest jump in energy prices will make it even harder for small businesses to stay competitive. The government says it wants manufacturers to export more but it does nothing to mitigate rising costs such as energy. We need a coherent industrial policy to enable SMEs to invest and grow. It's the only way we're getting out of the current economic difficulties."
"I can see a lot of people from all walks of life being concerned as some of the rises in energy costs are huge. I have seen some clients' bills go from £150 to over £400 on the new fixed tariff being offered, which is going to push many people into debt and put them in a position of having to decide whether to eat or heat."
"The rise in energy costs will be terrifying, especially for people already struggling with the problems high inflation brings. I suspect there's going to be a lot of debt consolidation remortgages in the coming months as people look to rearrange their finances, clear off credit cards and personal loans with a new mortgage to reduce overall outgoings, freeing up disposable income to take the pressure of potentially stretched income due to inflation."
"Rising costs are putting energy companies themselves out of business. This is reducing the number of choices available for consumers. The remaining companies aren't showing any signs of reversing their profit-driven business models. As far as I can see we're sliding towards a situation where the boards of a handful of global corporations are going to be in complete control of every aspect of people's lives. Amazon is already the second largest employer in the U.S. Unless something is done to stem this tide, the free world that we in 'The West' luxuriate in could soon be a thing of the past."
"It's the chain reaction that causes concern for my holiday lettings business. Increasing energy costs and interest rates mean the homeowners we work with have higher bills to pay and mortgages to afford. To make the numbers stack up, they will be looking to increase the rental yield for their property, which means higher prices for guests. The question is, how much heat can our guests take? Or how attractive will owning a holiday home become if there is a real sting in the running costs?"