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Small business costs rising

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A study by Warwick Business School for More Than Business, reported in the FT, shows that the price of 20 items that small firms are most likely to spend money on went up 0.6 per cent during the third quarter of 2009.

With the price of oil once again on the increase and broader measures of inflation heading northward quickly, it is likely that the cost of starting and growing a business will be notably higher in 2010.

Stephen Roper, professor of enterprise at Warwick Business School, said prices would continue climbing until the spring time, at which point they would level off at about the same point as before the recession.

Between July and September this year, fuel costs rose 3.4 per cent, despite a 17 per cent drop in the price of natural gas, while raw materials went up by 1.6 per cent.

Firms in the manufacturing industry saw costs rise by 0.63 per cent, compared with a slightly more modest 0.55 per cent increase for service sector businesses.

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