Increasing costs and ‘supply chain friction’ have backed Gloucestershire’s small businesses into a corner where they are left with only one option – to raise their own prices, according to Matt Griffith, director of policy at Business West.
Griffith said that small UK businesses were at a point where they could absorb no more rising costs, that increasing their own prices was ‘the only route left for many. Financially, they have nowhere else to go’.
‘We are seeing a lot of companies wrestling with a post Covid pricing dilemma,’ he said, repeating comments he also made to the Financial Times.
‘Having taken big hits to their income and balance sheet, and with tougher labour market and supply chain pressures, raising prices is the only route left for many of them. Financially, they have nowhere else to go.
‘Our survey data has shown historically very high inflation concerns for a couple of years now, widening from Brexit and supply chains to energy and the past six months has shown no let-up.’
Greg Pilley, owner of Stroud Brewery said the Five Valleys business had been forced to increase its own prices by seven per cent in the last few months.
‘I think next year we will see a change in global grain prices due to the war in Ukraine. We use about 40 per cent UK hops and about 60 per cent overseas. Predominantly they travel through Europe,’ said Pilley.
‘The increased tariffs from hops is causing us to put prices up significantly. There’s more friction on supply so it’s also becoming more difficult to access them which is time and cost.’
Small businesses, said Business West, simply do not have the buying power to reduce their costs.