Businesses hiking prices amid rising costs, BCC reveals

Most businesses are increasing their prices amid “acute” staff shortages and the rising cost of fuel and energy, research suggests.

A survey, conducted by The British Chambers of Commerce (BCC) revealed of 1000 firms, four out of five increased the price of their goods or services in the past year.

The BBC said its study indicated that nine out of 10 manufacturers and three quarters of businesses with more than 50 employees had a shortage of skilled workers in their own business or those in their supply chain.

HGV drivers, engineers, warehouse staff, accountants, chefs and IT technicians were among the skilled staff said to be in short supply.

Many respondents attributed the increased cost of vehicle fuel, shipping containers and utilities such as gas or electricity.

READ MORE: Petrol prices shoot up to record highs

“Since June we, and other businesses like us, have been heavily impacted by so many factors that take constant and daily fire-fighting and with no end in sight,” The commercial director of a South West food and drink manufacturer told the BCC.

“Commodity supplies are not only hard to get hold of, with ever extending almost unworkable lead-times, but are increasing in price on an almost daily basis, with some as high as 58 per cent since the start of the summer.

“Logistics and distribution charges have increased by up to 28 per cent. Labour, we are down to just 55 per cent of the staff that we had in May despite having implemented our third wage increase and different shift patterns to try and suit a wider market.

“These issues have caused us to have to rest, cap and even delist lines that we sell to the nation’s supermarkets, decline a large amount of sales and absorb write-off costs.

“We have always prided ourselves on being a brilliant supplier to our customers, but these trying times are testing relationships that have been built on years’ worth of high-quality products and excellent service.”

BCC director general Shevaun Haviland added: “These figures present a deeply worrying picture of the difficulties that businesses are currently facing across multiple fronts as supply chain disruption persists.

“Firms are facing huge pressures as they battle to keep on track for Christmas and provide the goods and services the UK needs, but we have yet to see any concrete steps to address these issues.

“Unless action is taken soon, firms could be forced to cut back on their capacity or limit the range of products they offer.

“The huge number of unfilled vacancies is placing further strain on staff having to cover, and Covid is also still with us. With more than 30,000 people a day having to isolate, it presents another ongoing disruption to the workforce which businesses must grapple with.

“While there are some global issues at play, there are levers that the government can pull to improve current business conditions.

“Firms also want to see a moratorium on all policy measures that increase upfront business costs for the remainder of this Parliament.”

Shadow Treasury minister Bridget Phillipson said the figures painted a “stark picture of the growing cost of living crisis” and added Labour would cut business rates to help companies, scrapping the tax for a “modern form of business taxation” in the long term.

The Labour MP said: “This isn’t because of Covid or global problems. Despite having years to prepare for Brexit, the Conservatives have no plan to boost skills and jobs for workers in Britain, or to deal with bottlenecks at our borders.

“Instead of taking action, the government are trapping us in a high tax, low growth cycle. They claim they can’t do anything about rising costs but they’ve found time and money to cut the cost of champagne.”

with PA Wires

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