Cash is Back: 1 in 5 Shop Purchases Made with Cash!.
According to retailers, the utilization of cash in stores has increased for the second consecutive year following a decade of decline.
According to the British Retail Consortium (BRC), cash in the form of notes and coins accounted for one-fifth of all transactions last year, as consumers reported that using cash facilitated better budgeting.
Additionally, the average expenditure per transaction experienced a slight decline, decreasing from £22.43 in 2022 to £22.03 in the previous year.
These findings were released following testimonies from charities to a committee of Members of Parliament, highlighting that various groups have been marginalized from accessing essential services and community facilities that have begun to reject cash payments.
Concerns were raised regarding women in abusive relationships, where their partners may utilize a bank account as a means of control or to monitor their movements.
Deidre Cartwright, policy manager at charity Surviving Economic Abuse, has stated that: "Oftentimes access to cash is their only means to actually accessing essentials for themselves and their children.
"It's a means for them to be able to escape an abuser, especially when that abuser can track them through a bank account, so it's incredibly important for their safety and survival."
Certain elderly individuals and those experiencing mental health challenges expressed a greater preference for cash transactions, as noted by the Treasury Committee. Additionally, some lacked the necessary digital skills or cognitive ability to rely solely on cards, computers, or mobile devices.
Leisure centers and universities are transitioning to a cashless system
Charitable organizations have indicated that exclusion is prevalent across various services and locations.
Wayne Crocker, the director of Mencap Cymru, noted that individuals could opt for a different café if one in the area chose to discontinue cash payments.
However, if the sole theatre in a town, or one affiliated with a university, were to eliminate cash transactions, it would result in some vulnerable individuals being unable to attend.
Ron Delnevo, representing the Payment Choice Alliance, mentioned that numerous services, including leisure centers, parking facilities, and food services on public transport, may also cease to accept cash.
"We have some heart-rending stories from families of people with disabilities, who feel that when they don't have cash accepted, it is robbing them of their self-esteem," he said.
"This was their money and they had the right to spend it, and they are being told their money is no good anymore. They take that as implying that they're no good anymore."
The BRC stated that all major retailers are dedicated to accepting cash transactions within their establishments.
Nearly 3 in 4 young people use mobile payments
Percentage regularly using mobile payment services, by age group, 2023
Age 16-24 – 72%
Age 25-34 – 60%
Age 35-44 – 38%
Age 45-54 – 27%
Age 55-64 – 16%
Age 65+ - 8%
Data released in July by the banking trade organization UK Finance indicated that a significant proportion of young individuals utilized smartphones or smartwatches for transactions.
Approximately 72% of those aged 18 to 24 frequently employed their digital wallets for contactless payments.
However, the report also revealed that the prevalence of individuals primarily relying on cash for everyday expenditures reached a four-year peak, attributed to the rising cost of living.
This finding was corroborated by the most recent data from the British Retail Consortium (BRC).
“Persistent inflation and the cost of living crisis continued to affect households across the country and many consumers used cash to budget more effectively," stated Chris Owen, payments policy adviser the BRC
The trade association is urging regulators to implement significant measures regarding the fees imposed by card companies.
Additionally, small enterprises have requested that banks maintain their branch operations or provide sufficient facilities for cash deposits.
Banking statistics indicate that cash continues to be the second most favored payment method, following debit cards.
The Financial Conduct Authority (FCA), the City’s regulatory body, has announced more stringent regulations to ensure that banks and building societies provide access to cash.
According to the new regulations, banks and building societies must address cash access deficiencies by considering alternatives such as banking hubs, ATMs, and Post Office services when contemplating branch closures.
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Cash is making a strong comeback as a preferred payment method, with one in five shop purchases now made using notes and coins. This resurgence highlights its value in helping people budget more effectively, especially in times of economic uncertainty. Cash continues to be essential for vulnerable groups, including those who face financial abuse, the elderly, and individuals with disabilities, offering them greater independence and security.
While digital payments rise, cash remains a vital, inclusive option, ensuring that no one is excluded from participating in everyday transactions. Its role in fostering financial autonomy and resilience remains irreplaceable.
Labour's Tax Bombshell Leaves Brits £300 Poorer: Record-Breaking Tax Burden Slams Wages, Soars Inflation, and Pummels UK Businesses.
In an unprecedented economic shift, Chancellor Rachel Reeves has delivered what is being called the most left-leaning Budget in recent decades, sparking controversy and concern across the UK. With a £40 billion tax hike, this Budget brings a new era of heavy taxation and increased government borrowing to fund expansive spending programs. This shift has already made a significant impact on the UK’s economic outlook, with the Office for Budget Responsibility (OBR) downgrading growth forecasts for the latter part of this decade, raising fears of an economic slowdown.
High Tax Burden and Inflation Concerns
The Budget introduces several new taxes and raises existing ones, driving the UK’s tax burden to its highest level on record. The impact on households is notable, with disposable income projected to drop by around £300 per person. This has led many to question how this will affect the everyday British citizen, as inflation and mortgage rates are both expected to climb. The OBR has already warned that the new tax measures will likely fuel inflation, driving up costs for food, energy, and housing.
This new fiscal direction has positioned the UK closer to a model seen in countries like France, where high taxes support extensive government programs but can also stymie business growth. According to the OBR, the overall tax burden is expected to rise from 36.4 percent to 38.2 percent of GDP by the end of the decade, with public spending projected to reach nearly 44 percent of GDP—a sharp increase from pre-pandemic levels.
Related: Budget Update: Chancellor Announces £40bn Tax Increase in New Plan
Impact on Wages and Employment
One of the most contentious elements of the Budget is the £25 billion increase in employers’ National Insurance contributions. Although aimed at funding essential public services, experts warn that it will be employees who bear the cost, with wages predicted to decline as businesses pass down the financial burden. The Institute for Fiscal Studies (IFS) has expressed concern over this measure, with IFS Director Paul Johnson stating that the increased tax on employers will ultimately "affect working people through reduced wages."
This wage impact comes at a time when the UK economy is already under pressure from rising inflation and a sluggish growth rate, sparking fears that the Budget will add further strain on household finances. Many are worried that the increased National Insurance costs will act as a "jobs tax," making it more difficult for businesses to hire and retain employees, particularly in industries struggling to recover post-pandemic.
Sharp Reaction from Business Leaders and Financial Markets
The Budget has drawn sharp criticism from the business community, with industry leaders warning that the tax increases could have a stifling effect on growth and employment. The Institute of Directors referred to the Budget as a "perfect storm" of challenges, including higher taxes, escalating wages, and new employment regulations. Rain Newton-Smith, chief of the Confederation of British Industry (CBI), expressed similar concerns, describing the fiscal changes as a "challenging Budget for businesses."
This unease has translated to financial markets, where government borrowing costs spiked following the Budget’s announcement. The ripple effects could mean higher borrowing costs across the board, impacting not only businesses but also homeowners, as mortgage rates are expected to rise in response to the Budget’s inflationary pressures.
Key Tax Increases and Economic Impact
The list of tax hikes and policy changes introduced in this Budget is extensive:
- National Insurance: Employers will face a £25 billion increase in National Insurance contributions, which the IFS has flagged as a significant burden likely to affect wages.
- Capital Gains Tax: Savers and investors will see an additional £2.5 billion in capital gains tax, with reduced reliefs expected to further dampen investment.
- Inheritance Tax: The Budget raises inheritance tax by £2 billion, impacting individuals looking to pass on pensions, estates, and farms to their descendants.
- Minimum Wage Increase: The minimum wage will increase by 6.7 percent, a move Ms. Reeves hailed as a win for working people, though many worry it may push inflation further.
- Stamp Duty: A new 2 percent surcharge on second homes is set to raise revenue, but critics argue it could disrupt the housing market.
- VAT on Private Schools: This "class war" tax, according to some economists, may push 35,000 children from private to state schools, placing additional strain on the public education system.
A Historic Budget with Possible Long-Term Effects
Ms. Reeves’ Budget also includes a £25 billion injection into the NHS, despite previous calls for reform, alongside a £32 billion increase in annual government borrowing after loosening fiscal rules. The Chancellor has defended these decisions as necessary to restore public services, but critics question whether the heavy spending can sustain the economy in the long term. The OBR has warned that the intense spending on public services may necessitate additional tax hikes if economic growth doesn’t materialize as hoped.
With the tax-to-GDP ratio now expected to hit 38.3 percent—the highest since the early 1990s under Norman Lamont’s post-Black Wednesday Budget—the current tax burden has already surpassed historical records. However, unlike the Conservative approach, which often centers on tax reliefs to stimulate economic growth, this Labour Budget is focused on an investment-driven strategy, with Ms. Reeves repeatedly emphasizing her commitment to "invest, invest, invest."
How the Budget Could Affect Everyday Britons
The average household will see disposable income shrink by approximately £300 due to the increased tax burden. This could further limit consumer spending, already under pressure from high inflation and stagnant wage growth. Many families are bracing for reduced spending power as mortgage rates are expected to remain elevated, a trend the OBR says may persist if the Budget continues to fuel inflation.
In particular, young workers under 21 may see immediate effects, as the Budget has eliminated lower wage rates for this age group, raising concerns over job availability and economic mobility. Meanwhile, those looking to purchase a home will face a 2 percent stamp duty hike on second properties, a change that could make property investments less appealing.
Related: Why are some People Receiving Tax Refunds?
A Budget in Historical Context
The scale of the tax increases and the emphasis on public spending have drawn comparisons to the budgets of the post-World War II era, during which Labour spearheaded initiatives to rebuild the UK. Ms. Reeves has positioned this Budget as a similar moment of "fundamental choice for Britain," asserting that her decisions are essential to repair the public finances left in "disarray" by the previous government.
Despite these lofty ambitions, some commentators have voiced concerns that Ms. Reeves may need to impose even further taxes to achieve her goals, particularly if the economic outlook continues to deteriorate. The £40 billion tax increase is already five times what was outlined in Labour’s July manifesto, and as the OBR notes, the spending surge planned for the next two years could place further strain on public finances if growth doesn’t meet expectations.
A Pledge for Future Stability, with Conditions
Ms. Reeves has committed to a "once-in-a-Parliament" Budget, promising no additional Budgets until next year. However, she has left the door open for further tax adjustments if necessary, stating it would be "irresponsible" to rule out future changes given the unpredictable economic climate.
For many, this Budget represents a defining moment in British fiscal policy, with the potential to reshape the economic landscape for years to come. While some view it as a long-overdue step towards improving public services, others worry it may come at a high cost for businesses and working people alike. As the UK faces these changes, the real impact of this historic Budget will become clearer in the months and years ahead.
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In the ever-evolving economic landscape, finding ways to minimize monthly expenses is more than a mere attempt at frugality; it's a necessity for financial survival and comfort. This guide will explore unique and effective strategies for reducing your monthly outlay, striking a balance between maintaining a quality life and ensuring your bank account remains healthy.
Refine Your Utility Usage
Utilities can be a significant monthly expense, but they also offer ample opportunity for cost reduction. Small adjustments such as switching to LED bulbs, fixing leaks, and optimizing your thermostat settings can lead to substantial savings over time. Consider a home energy audit to identify specific actions you can take to improve your home's energy efficiency. Additionally, residents living in certain areas have the option to choose their utility providers. For instance, exploring different electricity companies in Dallas could reveal more competitive rates, tailored to your consumption habits and potentially reduce your monthly costs even further.
Master the Art of Subscription Management
In the era of digital consumption, subscription services can silently bleed your finances dry. Conduct a thorough review of all your subscriptions, from streaming services to fitness apps, and cancel those you rarely use. For the subscriptions you wish to keep, investigate the possibility of sharing plans with friends or family to split the cost.
Revisit Your Insurance Policies
Oftentimes, we set our insurance policies and forget them. However, markets change, and so do our circumstances. Once a year, take the time to shop around and compare rates for your health, home, and auto insurance. You might find better deals or discover that you're currently over-insured. Adjusting your policies accordingly can lower your premiums and significantly reduce your monthly expenses.
Embrace Meal Planning and Smart Grocery Shopping
A big part of cutting costs begins in the kitchen. By planning your meals and adhering to a shopping list based on your meal plan, you can avoid impulse buys that often lead to overspending and food waste. Consider leveraging local farmer's markets for fresh, cost-effective produce, and explore bulk purchasing for non-perishable items.
Optimize Your Travel and Commuting Strategies
Transportation can eat into your budget in a big way. If possible, utilize public transportation, bike, or carpool to work. For those who must drive, consider the benefits of a more fuel-efficient vehicle or adjust your driving habits to improve fuel efficiency. Planning errands strategically to minimize trips and distance can also save money in the long run.
Adopt a Mindset of Mindful Spending
Ultimately, one of the most impactful strategies for reducing monthly expenses is adopting a mindset of mindful spending. Before making any purchase, ask yourself if it's necessary and within your budget. Practice delaying gratification and investigate cost-effective alternatives to your usual spending habits. This may involve trading expensive hobbies for cheaper or free ones, opting for at-home entertainment, or embracing DIY projects.
Explore Secondary Income Streams
While cutting costs is crucial, generating additional income can also provide financial relief. Look into freelancing, selling unused items, or investing in a passive income venture. Such activities can not only cushion your finances but also enrich your skills and personal growth.
Leverage Financial Tools and Apps
Taking advantage of modern technology can make managing finances much easier and more effective. Use budgeting apps to track your spending and savings goals, invest in stocks with low-cost brokerage apps, and utilize financial planning tools to visualize your progress. Technology can automate savings, provide reminders for bill payments, and help avoid late fees.
Commit to Continuous Learning and Improvement
Remaining adaptable and open to learning new ways to manage money is vital. The world of personal finance constantly evolves, and staying informed about the latest tips, tricks, and trends can lead to even greater savings. Consider joining online forums, reading financial advisories, or attending workshops to enhance your financial literacy.
Reducing monthly expenses doesn't have to involve drastic lifestyle changes. By applying some creativity, research, and discipline, you can decrease your outlay without sacrificing enjoyment or comfort. Start implementing these strategies today and watch your savings grow over time. Remember, the key to financial well-being is not how much you earn, but how much you keep.
As inflation rises and food prices continue to climb, many households across the UK have made the decision to go without broadband this year.
According to a survey conducted by Citizens Advice, up to one million individuals have canceled their broadband subscriptions in the past year due to the high cost of living, attempting to save money, and as part of their debt consolidation. The charity suggests that these individuals could have benefited from cheaper social tariffs or special low-cost packages. However, watchdog Ofcom has issued a warning, stating that 4.3 million eligible people are missing out on these deals.
In response to the situation, the government has collaborated with Ofcom and the industry to introduce a variety of products to the market, aiming to encourage the uptake of social tariffs. These affordable options are available in 99% of the UK and start from as low as £10 per month, according to the government's statement.
To simplify the process for benefit claimants signing up for social tariffs, a broadband eligibility checker has been introduced, and major providers such as Sky and Virgin Media have already joined the initiative.
Despite these efforts, Ofcom's findings reveal that the adoption of social tariffs remains very low, with only about 5% of eligible individuals taking advantage of them. However, this percentage has quadrupled since January of the previous year.
Citizens Advice conducted a survey of 6,000 people, which indicated that those receiving universal credit were six times more likely to have discontinued their broadband services in the past 12 months compared to non-claimants. Moreover, the charity expressed concern that the problem could worsen, as benefit claimants were four times more likely to fall behind on their broadband bills.
Ofcom reports that one in three households in the UK struggles to afford communication services, and they have called on companies to do more to promote social tariffs. Dame Clare Moriarty, the chief executive of Citizens Advice, stated the need for the watchdog to hold firms accountable and improve the uptake of these tariffs. She pointed out that people were being priced out of internet access at an alarming rate, and social tariffs should serve as the industry's safety net.
Other campaigners also highlight the fact that internet access has become an essential utility for day-to-day life. Those who cannot afford data face challenges in managing benefits, applying for jobs online, and benefiting from cheaper online prices, further exacerbating their financial difficulties.
The government claims that its job centre staff regularly guide claimants to relevant information on social tariffs, and individuals can access computers for their job searches at local job centres. Citizens Advice shared the story of Rob, a 63-year-old who has been unable to afford broadband since 2012. Rob explained that not having internet access at home significantly hampers his job applications and limits his access to services such as his GP, online help, and shopping.
The government highlights various measures it has taken to assist those who find broadband unaffordable. In June, after negotiations with the government, leaders from major broadband and mobile operators agreed to a set of public commitments aimed at supporting customers facing difficulties paying their bills.
However, the Digital Poverty Alliance, echoing the concerns of Citizens Advice, notes that while the uptake of social tariffs is slowly improving, it still falls far short of the levels necessary to ensure digital inclusion for all households. The organisation argues that even with an affordable social tariff, households in severe poverty may still struggle to afford essential connectivity.
Every year, consumers lean into the green movement, making more and more decisions about where to shop and what to buy based on a company's reverence for the environment.
Understanding and exploring this idea through the lens of energy saving doesn't just make a business more attractive, it can also generate appreciable long-term savings.
Customer Concern
According to an April 2022 study, the environment and sustainability are firmly in the mind of modern consumers. In this survey, 81% of respondents said the environment's future was a prime concern for them, with nearly 80% of US customers making some purchases based on sustainability.
The exact meaning of sustainability for customers in this survey varied, but it tended to revolve around a business's interest in reducing waste, cutting emissions, and recycling. More than two-thirds of the customers in this survey said they change their shopping habits if a business wasn't operating sustainably.
"20220810-RD-LSC-0308" (Public Domain) by USDAgov
In a modern business, some of the most visible moves made towards a greener motive are found in energy savings. Anything that burns through energy can and will be noted, and this effect will have profound implications for customer retention.
From the right perspective, this ideal offers significant opportunities to explore for savvy businesses, with energy-saving and green solutions aiding both customer interest and business savings.
Energy-Saving Solutions
Fortunately, in the modern environment, cost and energy-saving solutions can cover a wide range of useful products. The most visible of these are LED lighting systems to replace older incandescent bulbs. Though LEDs will often require a slightly higher initial investment, their lower ongoing energy costs and extended lifespans will more than make up the difference by the time they need replacement.
LED bulbs can use up to 90% less energy and last up to 25% longer than traditional solutions, making their adoption a must.
Similar advantages can be found in practically every part of business systems, where modern solutions are often vastly superior to the status quo. In retail, for example, older automatic hand cleaners are popular, but they can also be energy inefficient.
New solutions like a modern intelligent soap dispenser can allow a hybrid approach, using battery power initially and then falling back to manual operation once the battery is drained. This saves cost over a system that is operable 24/7 and can be better combined with renewable energy sources and smart technology to recharge at the best possible time.
Going into the 2030s has provided challenges, but the technological era had also continued to provide cutting-edge solutions. With so much emphasis put on green solutions by customers, and with money-saving options being more environmentally friendly than ever, there's never been a better time to step forward into new possibilities. Like the rest of humanity, business needs to look forward, and in doing so see a more cost-efficient horizon.
In 2022 energy prices increased by 8%, leaving companies with fewer funds to invest in their growth. Start-ups and small businesses take the worst hit, as they already have limited revenue. By ensuring proper protocols around the office, you can efficiently reduce energy bills and have more funds to spend on business projects. A few such protocols are mentioned below.
1 - Reduce HVAC Use
The HVAC (heating, ventilation, and air conditioning) system accounts for 40% of a building’s energy consumption. Decreasing the thermostat in winter can significantly reduce your energy bills. Instead of heating, correctly seal your windows and doors by installing weather strips and door sweeps to stop cold air. You can also install double-pane windows and hang insulated curtains.
You can improve insulation in your walls by filling in holes in the structure and adding new insulation every 20 years. These measures will keep your office warm by preventing cold air from entering while reducing the burden on your heating system.
You must also regularly clean the HVAC system’s filters so that debris does not accumulate, so the HVAC requires more energy for effective performance. In offices, ensure only the manager can control the HVAC settings. They can set an optimum temperature that is energy efficient and comfortable. They should also encourage employees to wear warm clothing inside the building and rely less on the heating.
2 - Energy Efficient Lighting
Energy-efficient lighting, such as LEDs, is a great way to reduce energy bills. Not only do they use less energy, but they are brighter and last longer in comparison to traditional bulbs. You must optimize your office’s lighting plan. You can achieve maximum brightness in minimum lighting by efficiently placing light sources.
Team leaders and managers should encourage employees to close extra lights and only use them per requirement. You can also install large windows and use blinds that allow maximum sunlight to enter your office. This measure will keep the office bright and warm. Ensure that whoever locks up the office double-checks to ensure no one leaves the lights on. Consider adding motion sensor lights in less frequented rooms such as washrooms and meeting rooms. They will automatically close when no one is present, reducing energy consumption.
3 - Install Solar Panels
Solar panels are the best option if you have an energy-intensive business that can not afford to cut back on energy use but is struggling to pay the bills. Solar panels have a high initial cost, but they make up their expense in 8.7 years. After that, you can enjoy nominal accounts and increased energy use. A commercial solar installer can install solar panels within two to six months and only require maintenance twice a year.
Utilize your building’s rooftop by adding solar panels. If your business is located in a building with multiple other offices, you can petition the landlord to add solar panels and pay the costs together. Solar panels help you save money and build customer loyalty, as environmentally conscious consumers prefer to purchase from companies that utilize sustainable methods like solar energy.
Endnote
Most of our energy supply comes from non-renewable resources like natural gas and oil. These resources are rapidly decreasing, and the increase in demand is causing energy prices to soar. For businesses, high energy prices mean a loss of profit. To ensure your profit margins don’t decrease, you must implement energy-saving tactics such as reducing HVAC use, utilizing energy-efficient lighting, and installing solar panels. The money you save from lower energy bills can be used in programs to grow your business.
This cost-of-living crisis has emerged from a perfect storm of factors, including the fallout from COVID-19, the war in Ukraine, and disruptions to the global supply chain. As a result of all of this, it is thought that fraud could become a bigger issue in the coming months and the Financial Ombudsman has already reported a sharp increase in complaints.
Types of Fraud
There are many different types of fraud to be wary of with cases currently on the rise. These include criminals posing as a customer’s bank and getting them to move money to a “safe” account as well as people buying items online but not receiving the goods that they order. Cryptocurrency scams are also increasingly common, and it is thought that these are mainly driven by social-media-based scams that take advantage of people looking to make money quickly (something many are trying to do during the cost-of-living crisis).
Another type of fraud to be wary of that is not online is MOT fraud. From 2021 to 2022, there were 1324 cases of MOT fraud and this can result in dangerous cars being on the UK roads putting all road users at risk. MOT fraud involves either qualified MOT testers not doing their job by giving certificates to vehicles that should have failed or even cars that have not been tested. In some cases, there are examples of MOT testers taking bribes for certificates. This is why you should always research testing centers ahead of getting your MOT and book MOT online from a trusted tester.
What Can Businesses do?
So, what can businesses do to prevent fraud from being an issue during the cost-of-living crisis? Preventing fraud will involve having robust processes in place, providing staff training, and using high-quality cybersecurity products to prevent cyber-attacks. You can also conduct regular audits to identify any potential vulnerabilities and to ensure that all processes are watertight and secure. Business owners should also pay attention to the news and look out for the latest scams.
The cost-of-living crisis is creating a serious issue for both individuals and businesses in 2022 and it could be a tough period ahead for many. Not only is the cost-of-living crisis stopping people from spending, but it is also having a knock-on effect in terms of fraud and scams. It is important to educate yourself and be wary in the months ahead so that you know what the common scams are and what steps can be taken to protect yourself.
The number of people shopping in stores is predicted to drop as the cost of living continues to rise. Challenges may lie ahead for businesses both big and small across the UK, with recent research finding that 71% of SMEs view inflation as their biggest cause for concern this year.
New data from Square has also revealed a trend of “lunchflation” in the UK. Lunch item prices are rapidly increasing, with rates jumping by 3% year on year with soups leading the way, with an average mark-up of 36% as of March 2022. This is a clear indicator of recent setbacks for businesses from the past two years.
The upcoming months are likely to look as tumultuous as the start of the year, however, there are actions business owners and leaders can take to safeguard themselves against unprecedented challenges and enable continued recovery as businesses navigate the post-pandemic world. Implementing tech to streamline operations is a strong starting point and also acts as a foundation to grow and pivot a business.
Streamlining operations
Making operations more efficient should be at the top of every business owner’s to-do list, enabling employees to spend time on what really matters - building strong customer relationships, perfecting their product or service, building out their offering and creating an engaging brand story to ultimately drive sales.
By integrating technology into operations, businesses can easily boost efficiency and standardise processes across locations. We’ve purposely designed solutions such as the Square Dashboard so that businesses can track sales by employee, monitor inventory, manage timecards, accept payments and more. This way a business's entire team only needs to use and be trained on one system (and control access to certain features via employee passcodes), so everyone across multiple locations is using the same POS, which is all linked to the Dashboard.
Hospitality businesses can create seamless communication between multiple ordering channels from front to back of house. The benefits of investing in automation aren’t just felt by the restaurants, they trickle down to consumers, too. For 400 Degrees Pizzeria, a pop-up pizzeria in Cambourne, that meant giving customers the choice of how they were served, whether that be online, or in-person.
Flexibility for maximum customer reach
The pandemic accelerated e-commerce and it’s clear this shift online is here to stay. In the UK, the share of classic lunch items that were ordered in-person hasn’t returned to pre-pandemic levels, as consumers have had to pivot to placing orders online for delivery and pick-up. Despite this, a number of orders are still being placed in-person - highlighting the need for businesses to offer customers flexibility in how they order across platforms.
Going back to our previous seller example, 400 Degrees Pizzeria, is using technology to maximise orders from each end. The owner Sam Corbin told us; “I’ve been using the Square KDS, it brings together all the orders in one place no matter if they were face-to-face or online everything is just there at a glance. There are two KDS screens in the van with one at the prep side & an ‘expeditor station’ at the hatch. We mark off on our screens when it’s made and that in turn shows at the hatch - then I tap it away when it’s been collected. As we’re all able to see what’s going on clearly we can accurately predict timings for walk-ups and get orders out faster than ever.”
Whatever the next year throws at businesses, one thing is clear; those who embrace change and adopt technology will have what they need to thrive. The human-interaction element of dining and shopping will always be a huge part of the holistic brand experience, but businesses need to use the right tools to meet customers where they are, whether that’s online, in-person, or a mix of the two.
Recovery is still on the horizon
In recent years, it’s been encouraging to witness small businesses adapt and innovate not just to survive but continue growing. Many have embraced an omnichannel approach by enabling their customers to shop through their own sites, or on social media. Recent research shows that 73% of consumers are now actively shopping through social channels, showing the demand for this approach.
Staying agile and aware of the changing customer habits will enable businesses to bend and pivot. Employing the right technology early will help them to adapt fast and keep multiple revenue streams open.
Figures from the British Retail Consortium show that shop price annual inflation accelerated to 1.5% in January, up 0.8% in the previous month and the highest rate since December 2012. The increase was driven by food prices, which were up 2.7%.
“January saw shop price inflation nearly double, driven by a sharp rise in non-food inflation. In particular, furniture and flooring saw exceptionally high demand leading to increased prices as the rising oil costs made shipping more expensive. Food prices continue to rise, especially domestic produce which have been impacted by poor harvests, labour shortages, and rising global food prices,” said Helen Dickinson, Chief Executive of the British Retail Consortium.
Rocketing food prices and the energy bill crisis drove inflation to 5.4% in the 12 months to December, up from 5.1% in November. Inflation hasn’t exceeded this level since March 1992, when it hit 7.1%. However, with gas and electricity costs expected to rise again in the spring, analysts predict that inflation will soon reach this level again.
“The surge in energy and travel costs is now impacting disposable incomes and is likely to dent consumer’s willingness to spend. NielsenIQ research this month shows nearly a half of all households are saying that their most important concern at the moment is the rising cost of living,” said Mike Watkins, Head of Retail and Business Insight at NielsenIQ.
National insurance contributions, paid by employers and employees in the UK, are scheduled to increase by 1.25 percentage points at the start of the new tax year in April. The tax increase is a manifesto-breaking move by the Conservative party, aimed at raising £12 billion to support NHS funding amid the pandemic.
However, former minister David Davis, amongst others, has urged the government to abandon its plans because of the financial pressure households are already facing amid inflationary cost increases and the imminent increase in the energy price cap.
Speaking on Monday on BBC Radio 4’s Today programme, Davis said, “It was a judgment made on, frankly, quite a lot of wrong data.”
“They didn’t know at the time that by April we would have the highest inflation rate in 30 years, they didn’t know that interest rates would be going up, council tax would be going up, the fuel price is about to jump by £700 a year for the average family. Therefore they didn’t know quite what pressure there would be on ordinary people.”
According to recent figures from the Office for National Statistics (ONS), real average weekly earnings dropped in November for the first time since July 2020, with basic pay without bonuses growing by 3.8% in the quarter to November. Average total pay including bonuses rose by 4.2%.
Meanwhile, consumer price inflation (CPI) jumped to 5.1% in November and is expected to reach as high as 6% in the spring as energy bills increase. Allowing for inflation, total pay was up by only 0.4%, while regular pay stayed level.
From September to November, the average total pay growth for the private sector was 4.5%, but for the public sector, this figure came in at just 2.6%.
“Inflation has waged war on pay and in November, salaries actually slid once inflation was taken into account. This has piled on the pressure for those struggling through the cost of living crisis, and things are going to get even worse,” said Sarah Coles, senior personal finance analyst at Hargreaves Lansdown.
“Wage rises have been falling steadily since spring 2021. Annual rises peaked at this point at 7.3% for regular pay and 8.8% for total pay, thanks to the fact that during the previous spring, wages had plummeted during the first lockdown. Meanwhile, inflation has ramped up from below 1% in February 2021 to more than 5% nine months later. In November, with inflation at 5.1%, it overtook wages.”
Store employees will see their basic hourly pay go up by 5.3%, from £9.50 per hour to £10 per hour amid a rapidly increasing cost of living and in recognition of the “extraordinary work” they do for customers.
In inner London, the hourly rate for workers will increase from £10.10 to £11.05, and from £9.75 to £10.50 for those living in outer London. The retailers’ drivers will also be given a pay rise, with Sainsbury’s Groceries Online drivers to receive £11.50 per hour while Argos Fast Track Delivery drivers will receive £11 per hour.
Around 150,000 members of staff will benefit from the companies’ new pay rates, which go beyond the National Living Wage and the voluntary Real Living Wage.
Chief executive Simon Roberts said: “To kick off the new year, I am pleased that one of the first things we are doing is investing in our colleagues and lifting our basic hourly rate of pay to £10.”
“We are making this significant investment to show our colleagues how much we value the brilliant job they do for our customers every day.”
