Small Business costs rising at Twice Rate of Inflation

Small business running costs increased at twice the rate of inflation between June 2007 and June 2008, according to a report from Warwick Business School and More Than Business. The Business Inflation Guide (697k PDF) claims that UK small and medium–sized enterprises experienced a 9.9% increase during the period. This is more than double the national rate of inflation, which currently stands at 4.7%. Micro–firms – those employing fewer than ten people – were the worst hit, according to the report. It suggests they experienced a 10% increase in costs between the second quarter of 2007 and the second quarter of 2008. The report’s authors attribute the dramatic increase to an exceptional simultaneous price rise on two fronts: as energy and fuel costs have risen, ... »

Be Honest about Pay Rises Employers told

Employers under pressure to give pay rises they cannot afford must be frank with staff. Research from business consultancy firm Croner Reward revealed that just 30% of employers have given a pay rise below last year’s level, despite the economic slowdown. The research highlighted that inflation and public–sector pay deals have been strong influences on pay–award decisions. According to CR’s business director, Andrew Walker, employers need to be open with employees and not just make pay awards that could result in the need for business cuts in the future. “The reality is that small–business owners and managers are facing the same pressures as their staff – their tax bills are going up, their utility bills are going up and their fuel bills are going ... »

Inflation pushes SME costs up a quarter

Rising inflation has resulted in ten per cent of small businesses seeing their costs rise by more than a quarter in the last 12 months, according to credit rating firm Creditsafe. The research from Creditsafe also revealed that 26 per cent of small firms have seen their costs increase by at least ten per cent over the same period, and 60 per cent of small businesses have experienced some degree of cost increase in the last year. “Businesses are faced by rampant business inflation, as the costs of fuel and borrowing increase dramatically,” said Creditsafe managing director Simon Camilleri. “They are also faced with the prospect of employees demanding inflation–busting pay rises to cover the costs of increasing petrol and food costs. “If inflation continues to r... »

Latest CPI/RPI figures

Inflation hits 3.8% in June

The rising cost of food and fuel drove UK inflation up to 3.8% in June up from 3.3% in May, according to The Office for National Statistics. This means that inflation is nearly double the government’s 2% target and already closing on the 4% end-of-year figure predicted by the Bank of England. The increasing inflation figure gives the Bank of England’s Monetary Policy Commitee far less room to cut interest rates amidst concerns over the economy as they are expected to cut rates only when inflation is under control. The ONS found that food and non-alcoholic drink prices were the main influences behind the inflation rise with price increases at a record 2.1% Oil prices, touching $147 a barrel last week, also increased inflation with petrol rising by 5.3p per litre between May and ... »

Food & Petrol Prices Hit Inflation

Inflation figure up on food and fuel price rises »