By Daniel Hunter
The cost of doing business is rising 3.1% faster than the rate of inflation, according to a study by the Forum of Private Business (FPB).
The FPB found that despite inflation in the UK falling from 2.7% to 1.6%, business costs for SMEs have grown by 4.7%. However, the FPB predicted a 6% rise in prices earlier this year, which suggests that things are slowly improving.
As many as 63% of those surveyed said that business costs had increased. Energy and marketing were the biggest risers, with 70% and 76% saying they'd seen an increase, respectively.
Almost four in ten said they were unable to pass on rising costs to customers, meaning they were forced to cut their own costs elsewhere.
Phil Orford MBE, the Forum's Chief Executive, said: "The major reasons for increases in prices are predominantly down to transport and energy prices rising. The economic outlook continues to improve but costs still remain an issue for our members and a key focus of our lobbying and support services.
“This is a timely reminder that despite all the talk of a need for above-inflation wage rises businesses continue to feel the strain of rising costs. With the auto enrolment of staff into pension schemes just around the corner, the affordability of significant wage rises coupled with increased pension contributions will be called into doubt.”
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