Connect with us

Hi, what are you looking for?

Business

Majority of UK SMEs are seeking ways to cut back on expenses due to economic pressures 

British businesses are fighting to stay afloat as current economic pressures lead almost seven in 10 to seek cost-saving measures.

The study quizzed senior decision makers across a range of small and medium-sized UK businesses, with 82% of business leaders stating the cost-of-living crisis has had a negative impact on their company.

Despite their best efforts to cut back on costs by switching their providers or negotiating existing agreements for general business expenses, two in five SMEs failed to make any savings.

Rent in business premises topped the list as the hardest cost to save money on, as almost one in five British businesses unsuccessfully attempted to negotiate an existing deal or moved location to shave a few pounds off their bill. Firms trimming back on employee benefits schemes were also less likely to see any fruits for their labours when looking to save.

In more extreme cases, SMEs have gone as far as scrapping specific outgoings altogether to ensure financial stability. Around one in eight small businesses (with 10-49 employees) cancelled staff parties and events to save on costs.

While many businesses will be feeling the effects of inflationary price rises, the sharpest increases are being felt in the cost of raw materials and stock, business insurance and office supplies.

The findings paint a bleak outlook for British business if the situation doesn’t improve. Almost one in 10 are considering doing away with employee commissions, while 7% are also considering canning advertising and marketing spend. Critical expenses, such as business insurance and cybersecurity, are also creeping onto the at-risk list for 6% of British firms.

However, some businesses are seeing success in the efforts to cut costs. Almost a third of UK SMEs have renegotiated their existing advertising and marketing agreements to get a better deal. In addition, switching providers led to more than half of businesses making savings on their medical insurance and conference call subscriptions.

Kevin Pratt, financial expert at Forbes Advisor, says: “Just as consumers are feeling the effects of the cost-of-living crisis, economic pressures are also putting a strain on SMEs. With expenses rising across the board, firms are seeing margins shrink. Our research clearly shows many businesses are looking to minimise financial pain by cutting back on outgoings.

“However, despite the majority of British companies seeking out cost-saving measures, three in 10 SMEs are still yet to explore money-saving methods. Simply looking to switch suppliers or renegotiate current agreements could result in huge savings for many.

“During these challenging times it’s important to maintain a steady flow of management information to help inform decisions and strategy. Using business accounting software will help you keep track of expenditure so you can build a bigger picture of where your money is going. Only when you know this can you formulate a plan to make essential savings.”

Read more:
Majority of UK SMEs are seeking ways to cut back on expenses due to economic pressures 

Advertisement

    You May Also Like

    Investing

    RevisingTheBankSecrecyAct_NorbertMichelAndJenniferSchulp_CMFAWP007   The post Revising the Bank Secrecy Act to Protect Privacy and Deter Criminals (CMFA Working Paper No.007) appeared first on Alt-M.

    Investing

    Recently, an investment advisor and Bitcoin proponent tweeted the claim that “[f]or most of human history” the “[s]eparation of money and state was the...

    Business

    Rollee enables worker’s to share their professional data, spread over one or more financial platforms. Ali Hamriti, CEO and Co-Founder of Rollee, is on...

    Business

    The energy crisis means that as the price of wholesale commercial energy hits an unprecedented high, businesses must pay notably more for their energy...

    Disclaimer: successfuldealnow.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2024 successfuldealnow.com | All Rights Reserved