Small businesses are now looking to next week’s expected mini-budget for help with skyrocketing bills despite the slight slowdown in inflation.
Some businesses said on Wednesday that their energy bills had more than doubled in the past three months alone.
Lesley So, founder of Derby-based eco-drinks maker So Good Kombucha, said the price of raw materials such as glass bottles had risen by 50% in the past year.
She said: ‘We cannot afford to raise our prices as we are competing with mass produced drinks which are much cheaper to manufacture and so we have no choice but to continue to take massive blows to our margins.
“I fear it will get worse over the winter as the demand for cold drinks drops and our bills continue to soar.
“This is going to have a significant impact on our ability to fulfill the company’s purpose, which was to create jobs for refugees and other marginalized people in our communities. If this continues, many small businesses across the country like ours will really struggle to survive. For us, we don’t feel like the economy is growing.
Sara Hall, founder of The Silk Purse Guild, said the energy bill crisis was “piercing the very heart of Britain’s small businesses”.
She said: “I work with countless small independent makers and many are struggling to buy their raw materials and get their kilns on.
“My little craft market has stalled mid-launch because no one in the creative community has the courage to take risks or the motivation to start something new.
“The tone in the community remains grim as the cost of living crisis deepens, with no clear relief in sight. It’s a constant battle to keep my spirits up, and my sanity has absolutely taken a hit, as the news seems to get worse by the day.
Olga Sipcenoka, founder of Hertfordshire-based restaurant Per Tutti, said: “Vendors are calling every week with further price increases which is really stressful. At this time we have not raised our prices as we need to be in line with our local competitors, including some very large chains, and our current dilemma is how long we can swallow the extra costs without passing them on to the customer. .
“We are a family of five and these are really worrying times. We are bracing for a recession as the UK economy is currently facing a perfect storm.
Amy Sabin, of Wareham-based personal training company Future Fit Training, said: ‘It doesn’t seem urgent to deal with the current economic crisis, as does the mental health crisis which will almost certainly follow.
Maryann Penfold, owner of Worthing-based artisanal hot sauce maker Boom Sauce, said inflation was “destroying” small businesses day by day.
“I’m really worried about the future of my own business because customers are spending a lot less. I can’t raise my prices because it risks losing customers and I can’t lower them either because the cost of ingredients has Many small artisan producers like myself are in a no-win situation. Lowering prices while raw material costs are skyrocketing is simply not viable.
Chris Maslin, director of Tunbridge Wells-based employee ownership specialist Go Eo, said workers wanted wage increases to match the soaring cost of living, which was putting real pressure on businesses.
“Growing their own food and installing solar panels is not viable for most people, so they have no choice but to pay rising prices for food and utilities. They are hoping for pay rises to cope, but already overstretched companies will struggle to afford it.
Ollie Hayes, former professional rugby player, personal trainer and founder of So Fit Bath, said: “The cost of keeping the gym warm in the winter months already sends shivers down my spine. Energy bills are skyrocketing and any small business with physical premises will feel the pressure right now.
“The energy price cap announced last week was a start, but you get the feeling that something more dramatic will be needed by Christmas. Hopefully something drastic is announced in the mini budget of the week next.
Dave Kelly, co-founder of Bristol-based butcher Ruby & White, said: “Inflation may have come down a bit, but that won’t be the case for millions of small businesses, especially those with an office or a store for heating and electricity.”
Property adviser Altus Group said businesses are urging the Chancellor to use the Emergency Mini Budget to scrap a business rate tax increase next April, which is indexed to the headline inflation rate in September .
If August’s 9.9% CPI inflation rate is repeated in September, non-domestic buildings in England such as shops, pubs, restaurants, factories and offices face a rise corporate rates of £2.66bn in the 2023/24 financial year, it has been estimated.