Close to half of UK businesses fear they may have to close due to rising energy bills, according to our survey. This is a worrying trend that could have devastating consequences for the economy, as well as for consumers who may see prices increase in order to cover costs.
The government needs to do more to support businesses and help them manage their energy usage, or else we could see a huge spike in unemployment and inflation. We urge the government to act now and provide the necessary support to businesses before it’s too late.
With energy prices on the rise, both consumers and businesses are feeling the pinch. According to a recent survey, close to half of all businesses in the UK fear that they may have to close as a direct result of the surging gas and electricity prices. This is having a knock-on effect on households as well, with many struggling to meet their energy bills.
The situation is made worse by the fact that wages are not keeping pace with inflation, meaning that people have less disposable income to cover rising costs. This is a real concern for the future as businesses are the backbone of the economy and if they are forced to close, it will have a ripple effect on jobs and growth. We need to find a way to ease the pressure on businesses and households so that we can avoid an economic slowdown.
The small business energy crisis: a Covid-scale problem
The findings of our survey are clear: businesses in the UK are feeling the squeeze. With the cost of living rising and margins getting tighter, many companies are being forced to raise prices in order to stay afloat. This is bad news for consumers, who are already struggling to make ends meet. The government needs to take action to help businesses keep their prices down. Otherwise, we risk seeing inflation spiral out of control.
The result is a spiral of inflation that makes it difficult for businesses to survive and consumers to make ends meet. While there are no easy solutions, it is important to try to break the cycle by finding ways to help businesses and consumers alike. One way to do this is to provide tax breaks or subsidies to businesses that are struggling to increases prices. This will help them to offset some of the costs, and it will also help to keep prices down for consumers. Another way to help is to provide low-cost loans or grants to consumers who are struggling with the rising costs.
This will help them to make ends meet in the short term, and it will also give them the opportunity to invest in their future by taking steps such as starting a business or going back to school. Breaking the cycle of the cost of living crisis will require a concerted effort from both businesses and consumers, but it is an essential first step in creating a thriving economy.
The Covid-19 pandemic has been an unprecedented challenge for businesses all over the world. Although many businesses have been able to weather the storm, others have struggled to keep their heads above water. Now, as we enter into a new year, it seems that the financial challenges of the pandemic are far from over.
According to a recent survey, 30% of business owners say that their business is actually doing worse financially than it was during the peak of the pandemic. This is a alarming statistic, and it underscores the importance of supporting businesses through this difficult time. Although the government has provided some assistance, more needs to be done to help businesses get back on their feet. Otherwise, we risk losing even more businesses to this ongoing crisis.
Read more: my company cannot pay its electricity bill
Is the government doing enough?
On 21 September 2022, the government unveiled its Energy Bill Relief Scheme, which is designed to protect businesses from rising energy costs. Until now, businesses have not been protected by any form of energy price cap, and many have been critical of the government for not acting fast enough to tackle the energy crisis.
The launch of the scheme on 1 October will provide much-needed relief for businesses that have been struggling to keep up with rising energy prices. Under the scheme, businesses will be able to claim a subsidy on their energy bills. This will help to ease the pressure on businesses that have been struggling to cope with the rising cost of energy.
The UK government has announced a new scheme to help businesses affected by high energy prices. Under the scheme, businesses will be able to sign up for fixed-rate contracts that will cap the price of wholesale electricity and gas at £211 per MWh and £75 per MWh respectively.
The scheme will last for six months, from 1 October 2022 to 31 March 2023, and there will be a review after three months to assess the most vulnerable industries and decide what help, if any, will be provided after March 2023. This is welcome news for businesses that have been struggling to cope with rising energy prices, and it will provide some much-needed relief during what is sure to be a challenging period.
The reaction from UK Businesses?
In reaction to the news of the Energy Bill Relief Scheme, 54% of business owners and managers said that this support is enough for the short term but are still concerned about what will happen once six months have passed. In general, 40% of those surveyed said that there is not enough support for businesses and that the government needs to much more. The Energy Bill Relief Scheme is a six-month relief package that will help businesses with their energy bills.
This is welcome news for businesses who are struggling to make ends meet, but many are still concerned about what will happen after the six months are up. The government needs to do more to support businesses, or else many will fail. This would be devastating for the economy and would lead to even more job losses. The government must act now to provide more support for businesses, or else the situation will only get worse.
When asked what the government should do to tackle this problem, a significant proportion of people (47%) said that they would support increasing levies on oil and gas companies. The thinking behind this is that such companies are making huge profits, and that by capping their profits, it would help to bring energy prices down.
However, it is worth noting that such a measure would likely be opposed by the oil and gas companies, and it remains to be seen whether the government would be willing to take them on. Nonetheless, it is clear that there is significant public support for action on energy prices, and the government will need to respond accordingly.
What are businesses doing to stay afloat?
In response to rising energy bills, 43% of businesses said that they are trying to stay afloat by having to make cuts to training and development budgets, the most common response alongside passing on costs to customers. Businesses cannot just sit by and wait for further government support. They must take proactive measures to ensure their survival and continued success.
Reducing spending in areas such as training and development may be necessary in the short-term, but it is also important to look for ways to increase revenue and reduce costs so that these cuts are not permanent. In the long-term, investing in training and development will help businesses to become more productive and efficient, offsetting the effects of rising energy bills. By taking proactive measures now, businesses can weather the current storm and emerge even stronger in the future.
The festive season is typically a time for celebration, but this year many businesses are cutting back on their Christmas parties in order to save money. According to a recent survey, almost half of businesses will either be reducing the size of their party or skipping it entirely. This is likely due to the fact that many businesses have had to reduce staffing levels in recent months, with 38% putting a hiring freeze in place and 25% letting existing staff go.
As a result, there may be fewer people to celebrate with – and less money available to cover party costs. However, some businesses are choosing to see the silver lining, with one respondent noting that smaller parties can sometimes be more intimate and enjoyable. Whatever the case may be, it’s clear that Christmas will be looking a little different for many businesses this year.
What can you do to save on business energy?
UK businesses are eligible for a discount on their energy bills as part of the Energy Bill Relief Scheme. However, this only applies to the wholesale element of the bill, and businesses will still be responsible for paying other fees and charges. These can add up quickly, so it is important to compare providers in order to get the best deal and save on business energy.
Make sure to look at all the costs associated with each provider, not just the unit price, as this is where you will often find the biggest differences. If you are not sure where to start, you may want to consider using the services of a business energy broker. A broker can help you compare providers and find the best deal for your business. In these uncertain times, it is more important than ever to make sure your business is getting the best possible value for its energy needs.
About the research
The survey, conducted by OnePoll on behalf of business insolvency helpline, polled 500 UK adults who own businesses or are senior level managers. Polling took place between 20 and 26 September 2022. OnePoll is an MRS Partners Company and its employees agree to adhere to the MRS Code of Conduct and MRS Company Partners Quality Commitment whilst undertaking research.
With over three decades of experience in the business and turnaround sector, Steve Jones is one of the founders of Business Insolvency Helpline. With specialist knowledge of Insolvency, Liquidations, Administration, Pre-packs, CVA, MVL, Restructuring Advice and Company investment.