A new UK report by bakery products manufacturer, Baker & Baker shows the significant impact the cost-of-living crisis is having on businesses such as bakeries, caterers, pubs and coffee shops.
The research, which involved a survey of more than 250 businesses, was undertaken over the summer months by Sapio Research. The standout finding from the research, which maybe won’t surprise some, is that 59% of businesses say that trading has been down on the previous 12 months.
However, this was just the tip of the iceberg, and there were many more interesting findings. When asked ‘what price increases have had the biggest impact on their bottom line?’, the top three answers were:
- 74% – product price increases, driven by rising ingredient costs
- 69% – utilities
- 40% – facilities (mortgage, rent etc) and packaging
Other key outtakes from the research found:
- The cost-of-living crisis has caused a decrease with 45% of businesses have experiencing a slight decline in sales while 10% have experienced a significant decline.
- Three fifths of companies have also seen a decrease in average spend per customer compared to the previous 12 months.
- 86% have seen an increase in the number of customers switching products.
“These are certainly unprecedented times”, comments Helen Sinclair, UK marketing manager at Baker & Baker. “And it looks like we’re in for a bit more pain before things start to improve. When we posed the question ‘when will the cost-of-living crisis end and things return to some sort of normality?’, more than half (54%) expect things to improve by the end of the year, and nearly a third of businesses (29%) are either unsure or think it will be later than summer 2024 before we start to see light at the end of the tunnel.”
