Increased operating costs putting strain on SMEs

Mike Randall, CEO of Close Brothers Asset Finance

Mike Randall, CEO of Close Brothers Asset Finance

More than half (59%) of small and medium sized businesses across the UK are experiencing increased operating costs, and of that figure, 58% say it is having a negative impact on their cash flow.

The figures come from the Close Brothers Business Barometer, a quarterly survey of UK SME owners and senior management.

Of those who are impacted by increased operating costs, almost two fifths state that rising energy bills are creating the greatest problem for them; while just over a quarter say that the cost of raw materials and stock is causing the most pressure on their cash flow.

CEO of Close Brothers Asset Finance, Mike Randall said: “Operating costs have increased significantly over the past few years, and are arguably one of the most difficult things for small business owners to manage in the current climate.”

More than a third of firms surveyed say that while their direct costs have increased, they feel unable to pass any of this on to their customers.

“This is a situation that is leading to increased pressure on already-tight margins and it is entirely possible that operational costs will continue to rise for the foreseeable future,” said Mr Randall.