THE latest economic quarterly survey from Herefordshire & Worcestershire chamber of commerce has revealed that local business is beginning to feel the pinch after the vote to leave the EU.
In the fourth quarter of 2016, 43 per cent of businesses said they were feeling pressure to raise prices, more than doubling since the vote.
This is mostly attributed to increasing costs of raw materials as well as volatile exchange rates.
Cash flow is also becoming a substantial concern, in particular for a number of small and medium enterprises (SMEs) with 20 per cent of businesses reporting a worsening situation.
This quarter, the biggest concerns for business are exchange rates (40 per cent), closely followed by corporate taxation (37 per cent) and competition (33 per cent).
Corporate taxation has risen significantly as a concern since summer 2016. This could be attributed to businesses being concerned about extra costs which could be inflicted on them over 2017, when they are beginning to feel the squeeze on a number of fronts.
However, while 2016 brought a number of challenges for the business community, the outlook for 2017 remains positive and businesses are set to start the year in solid health. 43 per cent of firms reported an increase in domestic sales over Q4 and a third of exporters reported an increase in sales abroad.
The majority of companies also expect profitability and turnover to improve over the next 12 months, a more positive picture painted by businesses than the results we saw in the previous quarter.
To help combat the rising concerns the chamber plans to launch a Business Manifesto 2017 containing all their priorities for local and national government.
This is due to be launched on February 3.
Mike Ashton, chamber chief executive said: “This quarter we are beginning to see the uncertainty around Brexit hit local business. The number of businesses expecting to raise prices has more than doubled and cash flow poses a real concern.
“However, businesses remain resilient and the outlook for the year remains positive, with the majority of business expecting turnover and profitability to improve.”
For a copy of the latest QES report please visit www.hwchamber.co.uk/policy/qes
