This morning, the Office for National Statistics published the latest inflation data, showing it rose to 5.5%. Newspage asked small businesses for their views:
19 responses from the Newspage community
"The current level of inflation means people just don’t have spare cash to spend on things like gifts. Our sales have bottomed out, leaving a wake of stress and anxiety. This inflation is not just draining our pockets, it’s putting a high price on our mental health and that is something which is meant to be priceless. The Government needs to sit up and listen to our cries for help."
"With each day that passes, my concern about inflation is growing as people simply aren’t spending. As a consumer I totally get it, it’s not pretty out there, but as a business owner it feels like I’m on borrowed time. All I can do is hope that the website traffic I am seeing does come back and convert at some point as people still seem to be largely browsing. It’s just so hard to predict anything right now and I can’t help feeling it’s just going to get worse."
"As the owner of a small shop on the high street, I've noticed that people are simply not out and about as you would expect, and one of the main reasons is almost certainly people do not have enough disposable income these days. High inflation is almost certainly to blame for low levels of footfall. I find that when my regular customers come in, there doesn't seem to be a concern that some items have had to go up in price, as the relationship takes care of that. With new customers, on the other hand, many look at prices and simply leave. A lot of people and potential customers are definitely having to be more cautious with their spending. I am aware of how hard it is for other small businesses and do my best to buy what I need from independent shops, market stalls or places that promote them such as the Not On Amazon Facebook group".
"I'm really feeling the squeeze in my online children's business. Stock is getting more costly to purchase and postage charges are increasing regularly. Unfortunately, I can't just put my own prices up as customers are already very price sensitive and have less money to spend. So it means I'm being forced to absorb the rising costs myself, which is unsustainable. After two years of the pandemic, it's been brutal for small businesses and now we're being ravaged by inflation. I can see many small businesses having to close because of it. Hopefully we can ride it out, but there is a lot of turbulence for people and small businesses ahead."
"As a catering company, price hikes across the board are giving us plenty of food for thought. We have to decide whether to increase our own prices and risk losing valuable bookings, or just take the hit."
"As an online business selling women’s fashion accessories, our suppliers have increased their prices due to rising raw material costs. On top of that, we import some of our stock from Europe and the shipping costs have also increased. Regrettably, we recently had to pass these costs onto our customers in the form of higher prices in order to keep the business viable. It's an incredibly challenging time out there right now."
"The increase in inflation is deeply worrying. Already as a small boutique owner, my energy bill is at a record high. On top of that, it is buying season and we are getting less for our money as fabric prices and duty have increased. We absorb what we can, but at some point something will have to give."
"With prices rising in every aspect of our personal and business lives, it feels as if the world is against the small business owner. I'm usually a really positive person, but watching fuel, groceries and all my expenses increase in huge leaps puts extra pressure on me to work even longer hours and raise my own prices to stay in the black. It's a very stressful time."
"I personally think the real reason inflation is hurting so much is that we've not experienced it for so long and have forgotten what it's like to live with it. While hopefully we can avoid double digit inflation, we are without doubt now getting into that inflationary spiral, prices up, wages up, house prices up, interest rates up. Those of us who are longer in the tooth have at least been here before. At the same time, as business owners, don't focus on the things you can't control, think about the things you can. As with so much in life, think about the bigger question: what does the current situation, as bad as it may be, make possible?"
"Inflation is making me feel constantly sick with worry. As a business owner, a home owner and a mum of a toddler and teen who eat us out of house and home each day, inflation is hitting us at every turn. I personally need to take a good hard look at my finances and see where I can tighten purse strings. I’m pretty sure I’m not going to be the only one having to do this."
"Thankfully we are a remote services business, so this new world of highly inflated costs is not hitting us quite as hard as those who produce goods. That said, we're still feeling the pain from crazily high heating bills. We've made the decision to invest in more jumpers."
"Over the weekend I filled my car with diesel for the first time in a while and the result on my wallet was pretty eye watering!"
"The main worry for mortgage holders and prospective buyers is that the only tool the Bank of England can use to curb inflation is to raise the base rate to try and dampen aggregate demand, which is a very crude and blunt instrument. So I wouldn't be surprised if we see the base rate at 1% or more by the end of the year with how things are going. Unless there are move government interventions to mitigate the problems, things are going to get very ugly. Hold tight."
"Market conditions for our mortgage business are getting tougher. Inflation running amok means lenders are factoring in the huge rise in the cost of living into their affordability assessments and offering lower borrowing amounts. Combined with mortgage rate increases, we think house prices could start falling over the coming months."
"Even as a relatively lightweight and agile business, it still feels like there is no way to escape being hit with rising costs from a variety of angles. This is amplified as some of our clients have been hit with significantly rising costs, which leaves us in a position where we don’t want to exacerbate challenges. Personally as a business owner, this is yet another ball to juggle, but after two turbulent years I’m used to all the uncertainty."
"Everything is going up and the impact on the hospitality industry is incredible. Now is the time for the Government to ensure they don't put VAT back up, too, which will add even more of a burden. It's also time to review the business rates system. There is little point in investing in high street regeneration if the system is fundamentally flawed, as it is at present."
"Working for myself, my office is at home, which means my bills are, and will continue to be, significantly higher. At least they will be if I want to be relatively warm and able to power my computer."
As a both a business owner and as someone with a family that includes two teenagers that are as hungry for snacks as they are the wifi and turning the heating up to maximum, the impact of inflation is being felt keenly every day. The price of everything is going up, which becomes an inflationary self-fulfilling prophecy as everyone else puts up their prices to help cope with their increased costs. It feels like a spiral from which we won’t be able to escape and that’s terrifying.
Many items are rising far higher than that percentage. Small businesses are not in many cases passing on the higher prices because they are equally concerned about the welfare of their financially-squeezed customers too. This is going to be a tough few months, and I just hope Government can help - this is a perfect storm for small businesses to top off the toughest trading years in decades.