Good morning and welcome to our Horizon Scanning newsletter.
This week we look at the energy crisis. With firms large and small struggling to keep their heads above water as bills spiral, we assess the options for business leaders.
Our Toolbox sticks to this theme, giving an overview of some of the most useful pieces of advice and guidance on the topic we have come across this month.
Thanks for reading and stay safe.
Horizonscan are experts in risk and resilience. Click here for more on what we do. If you would rather not receive the bulletin you can simply click ‘unsubscribe’ at the bottom of the email, and we will not bother you again.
The UK is presently caught in the grips of a ‘perfect storm of economic factors, from inflation to interest rates to the cost of living. Central to this is the energy crisis, which has arguably been brewing for years but which has spiralled completely out of control in the wake of the Ukraine situation.
This recent news article highlighted the impact of this on smaller businesses. And another piece, in the same publication, reported a 63% rise in insolvencies in the manufacturing sector. This viral tweet, pictured below and written up here, encapsulates the situation many SMEs find themselves in.
There is no silver bullet for these problems, which are affecting everyone in Britain and even Europe, in one way or another. But there are small things that can be done.
This guidance from Simply Business makes some handy suggestions, including the approach you should take to your tariffs, and how you can understand your usage better. We have used our Monday Toolkit this month (see below) to get together in one place with some of the other checklists and tips we have come across for managing energy costs as a business. You can go through them in one go and look to spot any ideas you had missed.
There are themes which run across this advice, including behavioural steps, ideas for monitoring usage more carefully, and tips to get the big calls right when choosing and changing your tariff. And it is also worth remembering that this crisis has partly come about through an over-reliance on imported gas and oil. If your company has the up-front revenue to become more sustainable in the short-term (i.e. by investing in renewables), then it could be revenue which you recoup in the medium-term, once the worst effects kick in.
Thought for the week:
“Unfortunately this is a crisis which is affecting every business and household. There’s no way you can sidestep it entirely. But by making clever choices now – about tariffs, usage and even the existence of renewable options – you can minimise the hit you take as a business.”