The true cost of rising fuel prices to Britain’s businesses

Businesses in Britain are paying more than a quarter of a billion pounds* more for fuel today than they were a year ago.

Research by the UK’s leading invoice finance specialist, Bibby Financial Services, reveals the country’s 4.8million small and medium-sized businesses are collectively paying on average £263,362,595 more on fuel today compared to 12-months-ago, as the average price of a gallon of fuel (diesel and unleaded combined) has gone from £5.50 to £6.31 in a year.

The Bibby Financial Services survey of small and medium sized businesses revealed more than half of firms, 52 per cent, who have been hit by the price rise will pass the extra cost on to the customer.

The findings highlight the extent to which rising fuel costs have impacted on businesses and what actions have been taken to absorb the costs; including passing it on to customers, making cuts to other areas of business and generating income from alternative streams to cover the shortfall.
Some sectors have been hit harder than others with 76 per cent of firms in transport and 51 per cent in wholesale having to pass on the cost. And in construction, 36 per cent said they had to make cuts in areas of the business. More than a quarter of businesses, 27 per cent, said they are reviewing company vehicles and planning to introduce more efficient models as a result of the increased cost. And 24 per cent say they have to make savings from other areas of the business to cover their losses.

The Bibby Financial Services research calculated the number of SMEs in the UK and how much fuel is consumed at average prices, combining the prices of unleaded and diesel, which revealed a total of £2billion will be spent this year based on current rates, compared to £1.7billionin 2010.

Around the country different regions approach the issue of rising fuel prices in different ways with 45 per cent of firms in Wales for example saying they had to reduce the amount of time spent on the road to cut costs, compared to the national average of 25 per cent. In Greater London the figure is 16 per cent and in Yorkshire it is 46 per cent.

Edward Rimmer, Bibby Financial Services UK chief executive, says: “Our research shows the widespread impact that the rising cost of fuel has had on small and medium-sized businesses, and that it has been one of the biggest issues facing companies in the UK.

“Businesses have had some very tough decisions to make as on the one hand they may face losing customers by passing on the extra fuel costs and increasing their prices, but in some cases they will have no choice as the cost cannot be absorbed in any other way.

“It is one of many challenges facing SMEs and highlights how important it is to stay on top of cash flow management when faced with rising costs.
“We have been working with businesses in the UK for more than 25 years and have an innate understanding of the issues they face in terms of managing costs and maintaining reliable funding streams.”

As an invoice finance specialist, Bibby Financial Services supports businesses by providing a flexible source of funding which alleviates the kind of financial pressures that many businesses have had to face with rising fuel costs, so they can concentrate on running and developing their business.

About Bibby Financial Services
Bibby Financial Services is the UK’s leading invoice finance specialist, currently providing cash flow funding for nearly 3,800 businesses, handling annual client turnover of more than £3.9 billion and advancing in the region of £321 million.

With a network of 16 local offices throughout the UK, Bibby Financial Services has the capability, flexibility and independence to make informed funding decisions quickly and efficiently.

Bibby Financial Services’ supports businesses in both the UK and overseas, utilising expert knowledge from more than 25 years’ experience, helping companies regardless of size or industry sector.

Bibby Financial Services recently secured a £340 million refinancing facility ensuring its ability to meet increasing demands for its finance facilities.

In 2011, the company was awarded a place in The Sunday Times 100 Best Companies to Work For, based on workplace performance and best practice.

About Bibby Line Group
Bibby Financial Services is supported by its parent the Bibby Line Group, a business-to-business services group involved in shipowning and operation, shallow water accommodation, offshore oil and gas services, contract logistics, financial services, memorial parks, employment law and health and safety advisory services, specialist plant and equipment hire, and retail.
The company was founded by Liverpool entrepreneur John Bibby in 1807 and has its head office in Duke Street, Liverpool.

Bibby Financial Services Ltd, Registered address: 105 Duke Street, Liverpool, L1 5JQ
Contact Information: 0800 91 95 92

Press Contact: Caroline Charles
Tel 0117 973 1173
www.brayleino.co.uk

This release was published on openPR.