A new study suggests owners of small businesses around the country are bracing themselves for a turbulent and uncertain year ahead with more than a quarter (28%) of small and medium size businesses admitting they won’t be hiring any new staff over the next 12 months due to the current cost of living crisis.
The research, commissioned by Vodafone, looked into the impact of the cost-of-living crisis on UK small businesses has found the rising cost of gas, electricity and fuel for business use is the greatest challenge for half of small business owners (53%), followed by staff pay rise demands (47%), spiralling transport and distribution costs (30%) and more expensive raw materials (28%). Nearly all, (98%), small businesses said good connectivity was crucial to their business yet more than a third (35%) admitted they have downgraded, cancelled or considered cutting their broadband service to save money.
The research, which surveyed 1,000 small businesses, found that despite tough economic conditions, small businesses remain optimistic with 43% saying they expected their business to grow in the next year. Indeed, 30% of business owners said the financial problems they faced had forced them to innovate and change the way they do things. Meanwhile, the rising cost of doing business had prompted around 1 in 10 (9%) to change their business or start a new one.
In response, Vodafone is offering free business broadband for a year to help small businesses mitigate rising business costs and stay connected to customers. Available until November 24, this support package offers Vodafone’s business grade broadband free for 12-months on a 24-month plan and is available to all small businesses as well as existing Vodafone Business customers who are eligible to upgrade.
Lizzie Carter, founder of hair company Only Curls, said: “The past couple of years have been challenging for small business like mine. First of all Brexit lost us all of our EU business, then the pandemic hit hard, and now the cost of living crisis combined with a rise in corporation tax is our next challenge to face. One thing that has helped my business financially is keeping my team working remotely, by avoiding additional rent or business rates, I have been able to invest in staff, stock and marketing to help my business grow. The team all enjoy working from home as it allows them more time with family, more flexibility on where they choose to live, and means no costs for commuting. Good Wi-Fi is essential for us, from all our virtual meetings, to marketing on our social channels, to banking, to running the website. Our e-commerce business simply would not exist without Wi-Fi.”
Nick Gliddon, Director of Business at Vodafone said: “With growing uncertainty in the economy coupled with spiralling business costs, Vodafone will continue to support small businesses who are the key drivers of employment, income, innovation and economic growth. This new offer of 12-months free broadband means one less bill to contend with for small businesses, who we hope can reinvest the money saved where it’s needed most.”
Once the initial 12-month period has passed, the monthly fee will revert to the standard rate of £26 (excl. VAT) per month for Business Broadband Superfast 1 and £29 (excl. VAT) per month for Business Broadband Superfast 2. There will be a one-time fee of £20 to cover set up costs, with no further payment required until the 13th month. Vodafone Business is also offering new customers a £200 gift card for utility bills to help alleviate the pressure of rising costs a little.