Seven out of 10 small and medium businesses in the UK are feeling the pressure of rising costs, with fears that they may have to close down. A recent survey of 500 small businesses revealed that 88% are trying to cut overhead costs, but a significant 69% still worry about the future of their business.
The main culprits behind these escalating costs are material costs and hidden fees charged by banks. Small businesses estimate they are spending over £3,700 annually on concealed charges for international transactions, which is equivalent to three months’ worth of rent in major UK cities.
To combat these challenges, many businesses are trying to negotiate better rates with suppliers and cutting back on energy use. However, despite their efforts, 56% have had to resort to layoffs, with 84% saying it was their last option.
Wise, a financial services company, is leading the charge with its “End the Opt Out” campaign to bring transparency to fees charged for international transactions. Arun Tharmarajah, director of European payments at Wise, emphasized the importance of finding solutions that don’t burden customers with additional costs.
Small business owner Davide Troise, who plans to expand his barbershop into Spain, highlighted the difficulties of dealing with UK banks for international expansion. He stressed the need for improved legislation to protect small businesses from hidden fees.
As small businesses continue to face challenges like increased shipping costs and staff wage hikes, it’s crucial for them to remain agile and creative in finding cost-effective solutions. With the holiday season approaching, many businesses are feeling the pressure, but with determination and strategic planning, they can navigate these uncertain times.