Home Business News Ukraine conflict adds to soaring business costs concern says leading consultancy

Ukraine conflict adds to soaring business costs concern says leading consultancy

by LLB Finance Reporter
16th Mar 22 12:36 pm

A leading global cost and supplier optimisation consultancy has seen a sharp increase in the number of businesses seeking their help with soaring prices since the start of the year.

Expense Reduction Analysts, which has been operating for 30 years, and has more than 700 cost-optimisation consultants across 40 countries with 91 based in the UK, has signed up 20 new companies in the UK since the start of the year, across a wide range of industries, including education, travel, designer goods, motoring, logistics, hospitality and tech solutions, as business leaders seek help with managing the spiralling costs of running their businesses.

Paolo Massimilla, UK Managing Director of ERA, says: “Brexit and covid have brought a whole range of challenges for businesses over the last two years, but rising inflation, energy and fuel prices are really hitting businesses in the UK hard, and as a consequence, our consultants are helping out more businesses than ever – and in some cases delivering six-figure sum savings.

“This rise in inflation, which could hit 5% this year, will most likely lead to an increase in interest rates, and the Governor of the Bank of England has already issued a cautionary statement about this. With the cost of borrowing set to soar, and the very worrying escalating situation in Europe – the war in Ukraine – only exacerbating the problems, businesses will need to review any loans in place and look to obtain favourable rates ahead of potential hikes. Our consultants will really be able to help our clients navigate this minefield.

“On top of that, 2022 will also see a raft of tax changes, such as the end of the COVID VAT deferral scheme and the introduction of a plastic packaging tax, as well as the increase in National Insurance rates.

The issues with supply chains across all industries show no sign of abating and, Massimilla says, “as such,  the just-in-time model adopted by many businesses is no longer the best option, and holding more stock is now much more preferable.

“Businesses that have a tighter control of their supply chains are going to be more successful and this is where our logistics experts can really help. Their contacts and knowledge in the industry are helping their clients to find volume and capacity within the networks, as well as make significant savings in a challenging  marketplace.”

Massimilla says despite the unpredictable operating conditions, companies are still prioritising sustainability. “As the public becomes increasingly environmentally savvy, businesses must do too and our consultants across all sectors have become experts in helping their clients to prioritise sustainability when it comes to business practices.

“Businesses need to be able to walk the fine line between their environmental footprint and their balance sheets, and this is where ERA consultants’ expertise can really add value.”

Changing technology demands has also been another hurdle for businesses to overcome, adds Massimilla.  “The remote working revolution has also forced businesses overnight to get more digital, and working from home is something that employees want more and more so companies that have embraced the digital transformation are seeing this reflected in their bank balances.

“And of course, the pandemic has led to many employees experiencing burnout, and this coupled with Brexit has led to a severe reduction in the workforce and created many human resources challenges. Businesses that prioritise their staff’s health and wellbeing are being rewarded with good employee retention rates, and our consultants have been able to help their clients find their way through this minefield, and make savings along the way.”

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