Record fuel price hikes taking big toll on firms
Half of businesses in Northern Ireland are suffering because of record fuel prices, according to a new survey.
The latest Close Business Barometer has revealed that the rising cost of petrol and diesel is taking its toll on 50% of firms here, despite the Government's decision to postpone a rise in fuel duty originally planned for the beginning of the new year.
The study has also revealed that one in 10 businesses are being forced to pass costs on to the customer.
Diesel has already passed its all-time high and yesterday stood at an average of 144.60p a litre. Two years ago petrol cost "just" 112.74p a litre, with diesel at 113.79p.
Fuel prices in Northern Ireland are already higher than any other region in the UK. There also remains a huge price differential between the cost of fuel here and south of the border, where last month petrol and diesel prices were 5p and 15p per litre cheaper respectively.
Businesses are also feeling the squeeze on tougher payment terms with almost 50% hit by late payments.
Harry Parkinson, managing director of Close Brothers Commercial Finance (Ireland), which carried out the survey, said that rising fuel costs remain one of the main concerns for firms and is having a huge impact on SMEs in particular.
"Bearing in mind that firms are already suffering, having been hit hard by the economic misery of recent years, coupled with consumer confidence being at an all-time low, it is not hard to see how increased fuel costs are causing firms a lot of additional pressure, which is ultimately pushing some beyond their limits," he said.
"The fact that these increased costs are having to be passed onto customers does nothing to help companies, who are already struggling to survive, attract new business or hold on to current customers. When increased operating costs are passed down to customers the knock-on effect on sales can be huge."
Mr Parkinson added: "Our research also shows that a staggering 48% of firms cite late payments as a major issue for their business. Of these firms, half are forced to wait longer than 30 days for payment.
"This cycle quite often puts firms under incredible pressure to make ends meet."