There is no escaping the far-reaching impact of the cost-of-living crisis on has had on businesses, large or small.
It seems we’re hit daily with more news of record-high inflation, soaring energy bills and a growing list of challenges being felt by even the most financially savvy.
Regardless of the success of any business, it’s impossible to escape the gloomy situation that has eclipsed so much of the industry of late. And it’s raw.
That’s why I was unsurprised to read that three-quarters of small and medium-sized businesses are now worried about the long-term impact of the cost-of-living crisis, with more and more firms being forced to increase their own prices in response to an environment that has now seemingly reached breaking point.
In response to Barclays’ SME Barometer, a quarterly survey of business sentiment conducted for the banks, over half (51 per cent) of small and medium-sized enterprises (SMEs) said they were concerned that rocketing prices would diminish consumer spending.
It’s a situation that I know many businesses will be forced to contend with, if they’re not already having to, as company owners grapple with prices that are rising faster than they have for more than a generation.
Many businesses have reported having already lost customers due to price hikes, with figures showing a bigger than predicted decline in retail sales in March and April.
In fact, the Office for National Statistics (ONS) revealed that retail sales volumes in Great Britain dropped by 1.4 per cent in March, after a decline of 0.5 per cent a month earlier as shoppers adjusted to rising costs. City economists had initially forecast a drop of 0.3 per cent.
The latest crisis, which comes far too soon after the Covid-19 pandemic and Brexit, has forced many employers to act at lightning speed once again on behalf of their workers, despite already feeling the pinch.
A recent survey by financial wellbeing platform Mintago found that 36 per cent of millennials felt money worries had impacted their work performance – something that is bound to have an impact on the efficiency and stability of any business too.
Despite this, the ways in which business owners have been stepping up to help their employees through the crisis, whether it be increasing staff wages or rolling out subsidies for energy bills, is to be applauded.
Scottish Sea Farms (SSF), the country’s second-largest producer of farmed salmon, has implemented a nine per cent pay rise for its lowest income workers to help combat the cost-of-living crisis.
Although there are many organisations that cannot afford to pay higher wages, many still want to show their support to staff and protect their workers from poverty before the impact really begins to really take its toll.
There’s a common misconception that business owners are greedy or that their only pursuit is making money. However, the truth of the matter is that no business can truly survive without looking after the wellbeing of staff, and the real cost can be neglecting employees rather than investing in them.
Throughout the pandemic, many companies rapidly shifted to ensure their staff remained at the forefront of their attention, offering new ways of working and strengthening sick pay arrangements to ensure those hit by Covid felt safe at work.
However, for some of the businesses that are already struggling, there may simply be no wiggle room this time. It’s crucial that businesses are being offered support during these difficult times too, and not just expected to pick up the pieces as crisis after crisis hits.
After a difficult few years, it’s important that we don’t allow this to dent optimism when it comes to businesses moving forward.
It’s hoped that the Scottish Government will continue to come forward with solutions that will not only help consumers across the country, but those who are working hard to keep their staff members intact as well.
Scotland Still a Top Pick for Investors
Despite the challenges being faced by businesses up and down the country it’s encouraging to see that Scotland remains an exceptionally attractive prospect for foreign direct investment.
Scotland outpaced both Europe and the UK in terms of attractiveness for foreign investors, falling just behind London.
Interestingly, the country saw a 14 per cent rise, in comparison to just 1.8 per cent across the UK and 5.4 per cent in Europe.
At a time when there is so much uncertainty, reports like the EY Scotland Attractiveness Survey prove that despite everything that we as a nation are contending with, there are still positive stories to be found in certain areas of business.
These are stats to be proud of – it is essential for Scotland to be seen as a desirable destination to invest in as we rely on international business to help accelerate our own growth.
It’s no surprise that the US continues to be the biggest originator of foreign direct investment however I was intrigued to find out that projects from Spain and also Germany have also risen since the last report.
Being second to London within the UK is a fantastic position to be in and hopefully this is a trend that we will see continuing.
It Made Me Laugh
Corgi Derby Delivers Royal Giggles
Glasgow made the news last week after it was revealed there was no official Jubilee celebrations planned – but that didn’t stop the rest of the country getting involved.
A number of retailers capitalised with an array of Jubilee merchandise and many workers were delighted to have those extra days off work, making up for lost time with family and friends.
There were also plenty of activities and events across the country.
While many celebrated traditionally with street parties, some brands went the extra mile with royal-themed events and one of my favourites has to be the Corgi Derby at Musselburgh Racecourse.
It’s as barking as it sounds – a bunch of The Queen’s favourite dogs racing to win first place as spectators cheered them on. Not quite Royal Ascot, but a good laugh all the same!
It Made Me Weep
Berries Left to Rot
One sector in Scotland which has been affected by rising costs, not to mention Brexit and a shortage of workers, is fruit farmers.
This industry faces another summer of produce being wasted, which is a problem when we’re supposed to ensure sustainability is on the agenda, no matter what sector or type of business.
One farm in Fife declared that 100 tonnes of berries went to waste last year due to a lack of workers along with wider transportation and supply chain issues.
With these farms set to dramatically reduce their produce, it means less choice for consumers at a higher cost.
At a time when it’s so important to buy local and support small businesses, this might not be possible and could lead to a ‘berry’ big problem.
