Rising energy costs ‘will force thousands of convenience stores to close’ | Retail business
Thousands of convenience stores will be forced to close due to soaring energy costs unless the government steps in with emergency aid, a trade body has said.
The Association of Convenience Stores (ACS) wrote to the Chancellor, Nadhim Zahawi, saying that without financial support, its members would be forced out of business. “We will see villages, housing estates, neighborhoods and shopping streets lose their small businesses,” the letter said.
The trade body, which represents 48,000 local shops employing 405,000 staff, said energy bills had soared to an average of £45,000 for smaller members, a figure more than double what shop owners had paid before renewing their contracts in recent months.
Collectively he said his members faced energy bills worth £2.5billion and needed a support package worth at least £575million to stay afloat.
“The government must understand that this is an emergency. Thousands of convenience stores will be forced to make extremely difficult decisions in the face of tens of thousands of pounds of additional energy costs in the coming months, which will at best include canceled investments, reduced staff hours and increased prices in the stores, driving up inflation even further,” he said. “For some, however, the cost of energy will make the business unviable, and so they will be forced to close unless steps are taken to provide meaningful support.”
The bailout plan outlined by ACS would include an emergency electricity price cap for small businesses and a freeze on further business rate increases, which ACS said would be phased out between October and March.
“We cannot overstate the urgency of the situation facing our members. They are very resilient businesses that sell a wide range of products and services, adapting to the changing needs of their local communities. ACS does not typically anticipate large-scale convenience store closures, but we are doing it seriously now,” ACS chief executive James Lowman wrote in the letter.
A Treasury spokesman said the government understood people were struggling with rising prices and was trying to support businesses “to navigate the months ahead”.
“We have cut taxes for hundreds of thousands of businesses by increasing employment allowance and reducing fuel taxes. We also introduced 50% business rate relief for retail, hospitality and leisure businesses, and curbed bill increases by freezing the $4.6 billion business rate multiplier. pounds over the next five years,” the spokesperson said.
“We are making the necessary preparations to ensure that a new government will have the opportunity to provide additional support as soon as possible.”