“Fall in inflation rates welcome news but SMEs remain under huge pressure”

“A fall in inflation rates is welcome news but it’s important to recognise that small business owners will remain under huge pressure from soaring interest rates, increased costs, and a turbulent economic climate.

“Our recent research shows that a quarter of SME owners are already worried they will be unable to pay their bills going into 2023. The government’s announcement repealing energy support promised to small businesses will have raised alarm bells amongst the SME community given that 70% of SME owners believe rising energy costs pose the single biggest threat to their survival.

“The Prime Minister set out as a priority for the government to halve inflation, which was welcomed by many small businesses, however, inflation is still at the highest level the UK has seen in years. Many small businesses don’t have the luxury of waiting another six months for inflation to stabilise, they are feeling the pressure more than most – with many struggling to pass on rising costs to their own customers, they are inevitably feeling the squeeze.

“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.”

Alan Thomas, UK CEO at Simply Business