Business owners admit to ‘feeling sick with worry’ over rising inflation
The news that inflation has reached 5.5% – its highest rate in 30 years – is causing concern for East Midlands business owners.
On Wednesday morning (February 16) it was confirmed that the Consumer Price Index inflation in January had hit figures last seen in March 1992, with one entrepreneur in our region admitting she is “feeling sick with worry” over the rising cost of living.
Helen Skripek, founder of the Derby-based caterer, The Butlers Pantry: “As a catering company, price hikes across the board are giving us plenty of food for thought. We have to decide whether to increase our own prices and risk losing valuable bookings, or just take the hit.”
The consumer price index (CPI) measure of inflation was in line with economists expectations – as clothing, housing, and furniture prices surged pushing the CPI rate of inflation higher.
The CPI measure of inflation is the rate at which the prices of goods and services bought rise or fall.
Natalie Bamford, creative firector of Derby-based Colleague Box: “Inflation is making me feel constantly sick with worry. As a business owner, a home owner and a mum of a toddler and teen who eat us out of house and home each day, inflation is hitting us at every turn. I personally need to take a good hard look at my finances and see where I can tighten purse strings. I’m pretty sure I’m not going to be the only one having to do this.”
Craig Bunting, owner of Derby-based coffee shop, Bear: “Everything is going up and the impact on the hospitality industry is incredible. Now is the time for the Government to ensure they don’t put VAT back up, too, which will add even more of a burden. It’s also time to review the business rates system. There is little point in investing in high street regeneration if the system is fundamentally flawed, as it is at present.”
Laith Khalaf, head of investment analysis at AJ Bell said: “Inflation is building and is now expected to reach a crescendo of over 7% in April, heaping pressure on consumers, businesses and savers.
“The elevated figures we are seeing today are effectively sunk costs, reflecting prices rises which have already happened, but what’s just as concerning is there’s more inflationary pressure to come.
“The Bank of England expects inflation of over 5% in the next year, and on top of the 5.5% we’ve just witnessed, that adds up to a double digit hit to consumer purses in just two years.
“Despite inflation dominating the market narrative over the last six months, it’s not hugely apparent in market pricing.
“There has been a sell-off in the bond market, but at a yield of 1.6%, the benchmark ten-year gilt isn’t squealing that inflation is a sustained problem.
“Likewise, there has been a rotation away from some of the higher valued areas of the market, but hardly the bloodbath one might have anticipated if inflationary concerns had really bedded in for the long term.”
