Following the lifting of COVID-19 restrictions, rebuilding people’s confidence to venture out and explore the vast range of diverse shops we have on our high streets has been is fundamental to the stability and future of those businesses. At the same time, though, an increase in the cost of living is putting a squeeze on local businesses and their customers alike.
Alan Ball is one of Business Sheffield’s team of high street experts, supporting local businesses to weather the challenge. "I am seeing three main areas that our high street businesses are facing challenges on,” he says. “The first is the increasing cost of energy: many businesses are now being offered new tariffs that are 40-60% more expensive than they were last quarter. Many are facing calls from debt collectors or energy providers, chasing payments and trying to coerce businesses into signing new contracts that are not competitive. It can be a frightening experience and one which leaves the owners feeling helpless.
"Secondly, the prices of ingredients and products are increasing due to higher shipping costs and shortages. We all know this from our own shopping bills; what we perhaps don't always appreciate is that most businesses just cannot pass these increases on and that puts pressure on cashflow and profits. Cashflow is the third key issue for businesses right now: I speak to many who have seen cash in the business reduce to nothing. Cash is king, and without it a business cannot pay suppliers, wages, and most importantly themselves.
“When businesses ask for some support with these issues, there are a couple of things that I tend to suggest they do immediately. The first is a cash flow forecast. It doesn’t have to be too scientific: just put a line on what the sales are weekly and carry that forward for a month, then add the outgoings weekly and take that over a month so you capture things like wages and utility bills. You can now see immediately if you have any shortfall and can begin to take action.
“The second piece to look at is your costs. When was the last time you looked around for an alternative supplier, or asked what alternative lines they might have available? I’ve seen many businesses surprised themselves with what is possible doing this.
I can be on hand to visit and support, not only on general business advice, but specifically around providing cash flow forecasts, advice on supplier contracts, advice on leases, and advice on concerns surrounding staffing issues and contracts.
“Our high street businesses are the backbone of our community, not only in the city centre but across the districts. Support for our high streets will maintain the important service they provide, the jobs they create and that all-important experience. I hope that they continue to reach out for support; I will certainly be on hand to do just that where my experience adds value."
If you’d like some support for your business, call us on call 0114 224 5000 or email BusinessSheffield@sheffield.gov.uk
You can also watch a recorded webinar from Alan on managing cashflow at https://bit.ly/3kCCF7g