Managing inflation during ongoing uncertainty
With inflation pushing 10%, businesses of all sizes are concerned to know just how this will impact them amid the ongoing cost of living crisis. Inflation hits not just consumers, but it also poses a real challenge for businesses. Not only do wages and supply chain costs head upwards, but they also face the additional challenge of demand for their products being squeezed.
Chirag Shah, CEO and Founder of Nucleus Commercial Finance, said: “Many businesses are worried about the current inflation rates and how they will manage to cope. This comes as the effects of Covid can still be felt today, making this challenge seem even more demanding.
“With the cost of living increasing, and stakeholders within their individual businesses taking necessary precautions by reducing outgoings, businesses will be considering how best to manage the path towards recovery and security. Whilst the tax-cuts proposed by the Chancellor are welcomed, more investment needs to be made to help small businesses feel the confidence they need to keep going. They need to know they’ve got the support in place before they continue to navigate these difficult times.”
- Assess your vulnerabilities: Consider what is essential to run your business day-to-day, and what you will struggle without. If part of your unique selling point is a personal touch, make sure to care for the employees who engage with your stakeholders as they will be the ones representing your interests. Additionally, consider investing in technology which can help automate simple, yet valuable tasks, such as emails, offers/discounts, and increasing visibility on social media platforms.
- Evaluate and reconsider your supply chain risk: It is important to think about your product and whether or not the supply chain could risk future business. If you find all your materials from a single source, import from overseas, or have to store it somewhere expensive, consider rethinking these routes of business. Support other local businesses by shopping locally, having a variety of suppliers to source from in case there are any chain disruptions, and where possible, bulk-buying to insure against possible future problems.
- Stay competitive: Identify what differentiates your product from others on the market and consider whether this can be further enhanced or promoted. Investing in the customer experience can also be a worth-while investment, such as easy-access to products online, or more staff available in stores.
- Consider taking out a loan with an alternative lender: Investing in your business now, especially when tax cuts are expected in the Autumn, means that this could be an opportunity to stand out against competition and continue to flourish as a business whilst others worry unnecessarily about their finances. Business loans are available for a variety of business types and needs, and the extra finance can help your company get off the ground running, achieve new targets or cover any funding gaps.