Recent research has revealed that small and medium sized enterprises (SMEs) are responsible for 61 percent of all employment in the UK. Total employment in SMEs has increased from 16.3 million at the start of 2021 to 16.4 million at the start of 2022, an increase of 0.6 percent.
In December 2022, the Small Business Saturday initiative celebrated the contribution of small businesses to the U.K. and used this as a campaign to encourage consumers to shop locally.
This comes in the context of the economic situation, where inflation is rapidly rising, with the Customer Prices Index (CPI) report showing the national inflation rate is at its highest since the report was first produced in 1997, averaging at 11.1 percent in October 2022. In turn, this presents a number of challenges for small businesses.
With the current economic situation presenting a number of challenges for SMEs in today’s world one Small Business Saturday participant – Solopress – has set out five ways small businesses can negotiate the rising cost of living crisis in the U.K. These findings have been provided to Digital Journal.
Access support from Local Enterprise Partnerships (LEPs)
In the face of uncertainty, many small business owners will be searching for ways to collaborate with the wider community. Local Enterprise Partnerships (LEPs) bring together businesses, the public, third sector and academia to make this possible.
There are 38 LEPs working towards investing in companies and communities in England. The Cumbria LEP, for example, is putting over £60 million into its local economy. This includes its Local Industrial Strategy, which will continue to leverage for funding until 2030. Not only will this create thousands of jobs for citizens, but it will also enable new businesses space to open and thrive within the area as its economy grows.
Save money on energy prices by switching to a fixed contract
Energy prices have escalated as a result of the cost-of-living crisis. Data from the Federation of Small Businesses (FSB) has revealed that electricity costs increased by an average of 349 percent between February 2021 and August 2022.
To address this issue, the government has introduced a six-month scheme that will benefit businesses in the UK. The Energy Bill Relief Scheme will reduce electricity prices to £211 per MWh and gas prices to £75 per MWh. However, the actual level of support will vary depending on whether your business is on a fixed, variable or deemed contract.
Attract investors with venture capital schemes
During the increasing cost of living, an investment could be the difference between businesses staying afloat and closing down. Investors are less likely to funnel money into start-up businesses, for example, during economic uncertainty. The same can be said for small businesses in their early years.
Venture capital schemes could be the saving grace you’ve been searching for. These schemes reduce taxes for investors if they are buying shares, bonds or assets.
Enrol on a free mentorship programme with ‘Be The Business’
Small business owners understand the pressures of keeping your knowledge and skills up to date while running an organisation. Despite all of the entrepreneurial skills you have, the cost-of-living crisis will continue to challenge practices. This is where mentorship programmes come into the equation.
The scheme ‘Be The Business’ provides free resources for small business owners to grow their organisations. Industry professionals offer targeted support – such as action plans and guides – in leadership, strategy, planning, sales and more.
Maintain the welfare of your workforce with free online training
Investing in and supporting employees is essential. Prioritising employee welfare within the workplace is important for employee wellbeing and satisfaction.
