Business News Round Up (14/11/2022)
Almost half of SMEs facing April cliff-edge on energy bills
A new British Chambers of Commerce (BCC) survey has found almost half of SMEs say they will find it difficult to pay their energy bills once the Government’s Energy Bill Relief Scheme ends on 31 March 2023. A further 4% say they will not be able to pay their energy bills at all, while 37% predict they will find it difficult to pay even when they are in receipt of Government support. Over four in ten (41%) SMEs disagreed that tariffs available the last time they renewed their contract were affordable. A further 29% said a range of tariff options was not available, while almost a quarter (24%) did not feel it was easy to change providers. A quarter of SMEs surveyed had renewed their electricity tariff since April 2022, while 22% had renewed their gas. These firms were more likely to struggle to pay their energy bills going forward with 60% saying they will face difficulties paying after March 2023, and 7% saying they won’t be able to pay at all. Over half (51%) will find it difficult to pay their bills between now and the end of March, during the period of the Government’s Energy Bill Relief Scheme.
Businesses to be given UK product marking flexibility
Businesses will be given an additional 2 years to apply new product safety marking, giving thousands of businesses the freedom to focus on growth, Business Secretary Grant Shapps has announced today (Monday 14 November). The UK Conformity Assessed (UKCA) marking has been introduced as part of the UK’s own robust regulatory framework. It shows that products comply with our product safety regulations which are designed to protect consumers. However, given the difficult economic conditions created by post-pandemic shifts in demand and supply, alongside Putin’s war in Ukraine and the associated high energy prices, the government does not want to burden business with the requirement to meet the original (31 December 2022) deadline. The government will continue to recognise the CE marking for 2 years, therefore allowing businesses until 31 December 2024 to prepare for the UKCA marking. Businesses can also use the UKCA marking, giving them flexibility to choose which marking to apply. To support manufacturers, the government is also reviewing the wider product safety framework, ensuring we minimise the burdens on business while keeping our system up to date with new innovative methods such as e-labelling.
https://www.gov.uk/government/news/businesses-to-be-given-uk-product-marking-flexibility
Scottish business confidence falls again
Scottish business confidence fell by -3% to continue a downward trend during 2022, but there are signs of optimism for company profits and recruitment, according to the latest Accenture and S&P report. At +14%, the net balance of manufacturing and service sector firms in Scotland expecting activity to increase over the next 12 months was lower than the UK average of +18%, but still ahead of the European average (+4%). October’s results for Scotland compared with net balances of +17% in June and +34% in February. More positively, despite tough economic conditions, Scottish firms remain more confident about profitability than their competitors across the UK. While confidence about profit fell to a net balance of -13% across the UK, in Scotland the balance rose from -4% in June to +9% in October. Optimism over hiring new staff also recovered from a balance of just +1% in June to +6% in October – although it is still below the UK average of +11%. Inflationary pressures remain elevated, with just over a third (+37%) of firms in Scotland expecting to raise their salaries over the next 12 months in light of the cost-of-living crisis and tight labour market conditions – less than half the UK average of +77%. Selling prices are also likely to rise sharply, contributing to firms’ confidence over profits. Yet optimism about profits didn’t prevent firms planning reductions in both capital expenditure and research & development spending, with Scotland net balances of -4% and -6%, respectively.
https://www.insider.co.uk/news/scottish-business-confidence-falls-again-28482870
North West private sector sees sustained decline in business activity
The North West private sector showed a sustained decline in business activity at the start of the fourth quarter, the latest regional PMI data from NatWest has shown. Growing concerns about the outlook for the economy and persistent high inflation have weighed on demand. The headline North West PMI Business Activity Index – a seasonally adjusted index that measures the month-on-month change in the combined output of the region’s manufacturing and service sectors – registered 48.4 in October, down from September’s 49.4 and falling further below the 50.0 threshold that separates growth from contraction. The decline in business activity, which was led by the region’s manufacturing sector, was broadly in line with that seen across the UK as a whole (48.2). October’s survey indicated a further weakening of demand faced by firms in the North West, as underscored by a fourth straight monthly decline in inflows of new business across the region. Furthermore, the rate of contraction accelerated and was the steepest since January 2021. Underlying data showed that the main drag on new orders came from the manufacturing sector. Firms in the North West grew less optimistic about the year-ahead outlook in October.