Small businesses are bracing for a turbulent winter as concern continues to grow over the new COVID variant, alongside the re-introduction of COVID restrictions and the on-going supply chain issues and staff shortages.
So far this year, shipping delays (24%), supply chain disruption (24%) and the covid pandemic causing a risk to health for staff working (23%) have been the top driving factors which have negatively impacted small businesses, according to a new report.
The report reveals one in two (52%) small businesses have experienced supply chain issues while two in five (41%) have experienced staff shortages over the past year.
More than half (56%) of SME owners anticipate the current issues to only get worse before they get better.
The staffing and supply report carried out by card payments specialist takepayments limited, surveyed 520 SME business owners across the UK to uncover how the current staff shortages and supply chain crisis is affecting small businesses.
Over two thirds (67%) of those surveyed think the supply chain and staff shortages are going to impact their clients or customers over the festive season, in particular businesses within the hospitality sector (46%) closely followed by the food and drink sector (44%).
Almost half (48%) of business owners said the combination of staff shortages and supply chain issues have already caused a negative financial impact on their business and one in four describe the financial impact as significant or critical to their business (23%).
Two fifths (40%) of those surveyed said if the staff shortages and supply issues were set to continue into 2022 then there is a strong chance their business wouldn’t survive, as more than half (55%) think these issues are set to continue for more than a year.
Businesses are being forced to make tough decisions to reduce the impact on their business and the bottom line.
How could small businesses be better supported?
Business owners would like to see the following Government backed solutions or actions during the next few months, to help combat the effects of staff shortages and supply chain issues:
- Tax breaks for small businesses: 41%
- Paid training programmes: 26%
- Specific SME support packages: 25%
- Army involvement to plug gaps such as fuel delivery: 23%
- Emergency visas: 23%
This is likely not to come soon enough for the festive period where, over a quarter (27%) expect to see major disruption for their customers or clients during the Christmas season.
Sandra Rowley at card payment solutions provider takepayments limited said: “Our report suggests businesses are delaying their growth plans due to supply chain issues or staffing shortages (25%), this means businesses could be growing at a slower rate..
Until the supply and staff shortage issues are overcome, small business owners across the UK could continue to be hit by negative financial implications which may ultimately lead to further increases in consumer prices.
Small businesses are calling on the government to introduce a tax break to help them financially navigate through this climate. This support would help relieve the financial pressures small businesses are facing, whether it’s increased stock costs due to supply issues or increasing salaries to attract staff.”
