Rising inflation risks of closure for thousands of small businesses across the UK

Following the announcement this morning that the Consumer Price Inflation figures have risen over October, with inflation soaring, UK SMEs are putting survival tactics in place to cope with the current economic climate – including price hikes planned for the next 6 months, halting expansion / opening new premises and holding off on hiring employees – to cope with crippling rising costs.

Alan Thomas, UK CEO at Simply Business, one of the UK’s largest providers of small business insurance, comments on the latest ONS inflation figures: “This morning’s announcement of another rise in inflation comes with a clear recession warning from the Bank of England, and poses a significant risk of closure for thousands of small businesses across the UK.

“The fact is, sole traders and microbusinesses will continue to feel the squeeze more than most, with many understandably struggling to pass on rising costs to their customers. The rise in inflation will inevitably also affect consumer purchasing behaviour which will be another blow to the income of small business owners.

“This comes at a time when many are still in recovery mode – one in six SMEs believe they will never financially recover from the impact of the pandemic. And with soaring energy prices and a cost of living crisis now hitting owners hard, many are rightfully calling for long-lasting financial support from the government.

“Small business owners will be waiting with bated breath for Thursday’s Autumn Budget announcement. Curbing rapidly rising inflation rates and setting out clear plans for SME support need to be front and centre of the Chancellor’s Budget – if our economy and communities are to recover, we need small businesses to bounce back.”