I was honoured to be invited to a Business Leaders reception at Number 10 Downing Street in which Deputy Prime Minister Oliver Dowden gave a speech on the government’s commitment to business.
As I networked with some very impressive business people, I was reminded that small businesses are the backbone of the UK economy, accounting for over 99% of all businesses and employing over 50% of the workforce. However, the challenges being faced at the moment are crippling for many. Some common themes from my conversations emerged:
- The cost of living crisis
The cost of living crisis is having a significant impact on small businesses, as consumers are cutting back on spending. In addition the need to increase staff wages and not always being able to pass the cost on is leading to lower sales and profits for small businesses.
- The rising cost of energy
The rising cost of energy is another major challenge for small businesses. Energy costs make up a significant part of the overheads for many small businesses, and the recent rise in energy prices is putting a strain on their finances.
- The shortage of skilled workers
The shortage of skilled workers is another challenge facing small businesses. This is making it difficult for small businesses to find the staff they need to operate effectively, especially in hospitality.
- The uncertainty of Brexit
The uncertainty of Brexit is also a challenge for small businesses. The UK’s exit from the European Union has created a lot of uncertainty for businesses, and this is making it difficult for them to plan for the future. Sometimes creating supply chain issues or additional taxes.
Despite these challenges, business leaders continue to be hopeful and resilient by:
- Focusing on customer service
In times of economic uncertainty, customers are more likely to choose businesses that offer excellent customer service. Small businesses can focus on providing excellent customer service by being responsive to customer needs, resolving issues quickly and efficiently, and going the extra mile to make sure customers are happy.
In order to stay ahead of the competition, small businesses are innovativing. This means finding new ways to do things, such as using new technologies or developing new products or services. Innovation can help small businesses to differentiate themselves from their competitors and attract new customers.
- Upskilling and reskilling their workforce
Small businesses can help to address the skills shortage by upskilling and reskilling their workforce. This can be done through training and development programs, as well as apprenticeships and internships.
The challenges facing small businesses in the UK are significant, but one thing I am sure about is that if there is a creative solution, business people will find it, and I really hope that the government offers support to small businesses who we know are creating the economic future of the country.
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