Rocketing inflation puts 1 in 5 firms at risk
A report from the Night-Time Industries Association (NTIA) revealed almost half (48%) of businesses in this sector are ‘barely breaking even’.
Some 44.7% of respondents were ‘unsure’ if their livelihoods will survive the next 12 months and a fifth (20.8%) were ‘not confident’.
Furthermore, over half (54.8%) stated they had ‘little scope’ to raise prices within the local market.
Further pressure
There was also a further 20.8% who said they had no scope at all, as a result of the cost-of-living crisis causing consumers to have less disposable income.
Trade body CEO Michael Kill said: “Inflation reaching double digits at 10.1% in the past 12 months to July, up from 9.4% puts further pressure on businesses, placing over a quarter a million jobs at risk and one in five business on the brink of failure in the next six months.
“We are seeing businesses handing the keys back to landlords every week, as operating costs become completely unsustainable.
“Time is running out for the Government to intervene, at this moment we need a decisive leader who will stop escalating energy prices and give further relief to struggling businesses by reducing VAT and extending business rates relief.”
Calls on Government
Kill said the Government could not continue to underestimate the escalating crisis within the energy sector.
He added that limited competition had resulted in “already unsustainable” tariffs and warned firms that had survived the pandemic, supported by public funding, will face further uncertainty and in many cases, permanent closure.
Just last month (July), the NTIA urged the Government to reduce VAT to 12.5% for the sector, for the next 12 months.
It also wanted a commitment to continue business rates relief beyond the 2022-23 financial year and an energy cap for small to medium enterprise businesses.
