Ahead of the Bank of England interest rate decision today – with a rate rise looking like a nailed-on certainty – 11 small business owners share their views on how the decision will impact them.
Zena West, a glass artist at Nottinghamshire-based West Art And Glass: “With interest rates and inflation rising, I have gone into survival mode. I am hoping I manage to weather what is looking to be a very long storm ahead. The cost of electricity, raw materials, travel and postage costs have all gone up, as well as food, and now higher interest rates are adding to the pressure. I’ve resisted raising my prices for now amid the cost of living crisis, but it is inevitable. I’ve also had to stop investing in my business or expanding my range, as money won’t allow it. Where is the Government support for the small businesses that are the bedrock of the economy?”
Jamie Rackham, founder of UK Facebook group, Not on Amazon, which has 193k members: “Interest rates rising and the cost of living crisis are crippling millions of people and small independent businesses. It’s a nightmare scenario and the Government is asleep at the wheel. The post-pandemic financial crisis, where the cost of pretty much everything is rising, has got the economy and millions of small businesses in a headlock.”
Seena Gosrani, owner of London-based jeweller, Bottlebee: “With interest rates and the cost of pretty much everything rising, the walls are closing in on small businesses. Compared to this time last year my sales have dipped. We were in Covid times last year and sales were steady so I can only put the dip down to soaring inflation and the terrible state of the economy. Consumers understandably don’t need handmade jewellery, they need heating and food. I myself am now spending more cautiously as I am unsure what future outgoings will be. I have to pass on any increase in supplier costs to the consumer, which clearly puts pressure on sales.”
Friday Lawrence at Forest of Dean-based Friday Lawrence Silverware: “Interest rates are rising and there could be a long way to go yet given the extent to which inflation is out of control. The inflationary pressure on small businesses is proving unbearable for many and there’s no guarantee raising interest rates will alleviate it. The Government should be focused on supporting small businesses and households who are under a massive strain. Instead, billion pound companies announce huge profits and avoid tax. Until we tackle big business and start taxing the billionaires proportionately, things won’t get any better for us at the bottom. The economic system that the everyday business has to operate in is massively outdated and hugely biased towards the wealthy, especially under this Tory government.”
Jenny Blyth, owner of London-based Storm In A Teacup Gifts: “Any interest rate rise will add to the extreme pressure people like me are facing. Small businesses like my own are currently stuck between a rock and a hard place. Rising costs and interest rates mean that if we want to keep any of the money we make, we need to raise our prices. But if we raise our prices, our customers will be even less likely to shop with us because they can’t afford to do so. The economy is in a state of disarray.”
Esme Marshwitch, owner of Alton-based glass artist, The Glassy Witch: “I am being forced to rely more and more on credit than I want to. Interest rates going up will likely mean bigger bills on any debt, putting even more pressure on my finances. And it goes without saying that we will see little, if any, uplift in savings interest. I simply can’t see how a recession can be avoided at this point, given the impact of the pandemic and the added costs that Brexit has created. And all this time, our ministers have for the most part been feathering their own, their families’ and friends’ nests. The massive expenses claims that many MPs make, while their constituents have to decide whether to pay rent, utility bills, transport costs to get to work, or buy food, are a disgrace. Our government has zero interest in the public good.”