'Devastating and out of touch' - independent retailers react to Budget bombshell
Posted on in Business News , Cycles News
Following Bira's initial response condemning the Budget as 'the most damaging for independent retailers in recent memory', members have shared their stark reactions to the triple burden of doubled business rates, increased National Insurance, and higher minimum wage costs.
Multiple retailers have calculated specific impacts on their businesses, with costs ranging from £90,000 to £150,000 per year.
Andrew Massey of Masseys DIY in Swadlincote, Derbyshire, said: "This budget was horrendous for us as a company. Estimated costs to be around £110,000 - £120,000 per year."
The immediate impact on employment is already evident.
Peter Massey of R Massey & Son Ltd, employing 38 staff, said: "We decided last night that we will not replace the next two members of staff that leave. We are also considering what to do with our coffee shop that employs quite a few youngsters."
Kevin Arthur of Pewsey RadioVision in Wiltshire highlighted the broader staffing implications: "The minimum wage rising to £25.5k per year (40hr week) is scandalous. Having to pay this type of salary for your most basic of employees will mean less employees, resentment amongst 'more valuable' staff who believe they are 'worth' far more than a basic employee, and less ability to pay staff bonuses. I am now looking to reduce staff hours, reduce staff numbers, and Christmas bonuses will be curtailed and any other 'perks' reduced."
A store owner in the South West, whose business has traded for over a century, revealed: "Prior to the budget we were looking at taking on a new store and creating 12 new jobs. The colossal impact that Labour has imposed on our business means that not only will this new store not happen, but we will be reviewing our sites and having to make redundancies in order to survive."
William Coe, of Coes in Ipswich, highlighted the challenge facing customer-focused businesses: "We all want the same thing – Growth – however for growth businesses need to make a profit to enable them to invest. With the cost rises put upon them yesterday this gets harder and harder especially for the retail and leisure sectors where the ability to make savings through technology is limited."
John Jones, Managing Partner of Philip Morris Direct in Hereford, warned: "We've been saying for months that the issue for small business is the cumulative effect of so many extra costs. These add up to a level of costs that just aren't sustainable, and I fear there will be a blood bath of small business on the high street."
The impact threatens the very existence of some long-established businesses.
A West Midlands clothing retailer with over 100 years of trading history confirmed they are "closing the doors in the near future," adding that "the cumulative effect of the rate hike, NI increase and the Minimum Living Wage increases mean that already emptying towns will become wastelands."
Many retailers expressed frustration at what they see as broken promises.
A Birmingham-based jewellery store owner said: "High Streets are the cash cow for Governments and when most have disappeared, they will scratch their heads and wonder why."
The combined impact of these measures threatens not just individual businesses but entire local economies. With many retailers already reporting worse trading conditions - Bira's recent survey showed 46% reported worse trading in early 2024 compared to 2023 - these additional costs could prove the final straw for many independent businesses.
Andrew Goodacre, CEO of Bira said: "For some, the Budget has forced immediate operational decisions. Several retailers mentioned reviewing staffing levels, reconsidering expansion plans, and in some cases, accelerating closure plans. The impact on future generations is particularly concerning, with multiple family businesses questioning their long-term viability."
A Midlands hardware store owner summed up the common challenge: "This will make trading near impossible with wage increases and the business rates and no one wants to pay anymore for goods."
We want to hear your thoughts
We made it clear that this is the most damaging for independent retailers in recent memory, with a triple blow of doubled business rates, increased National Insurance, and higher minimum wage costs threatening widespread high street closures.
At a time like this, it's vital that we hear your voice so we can act on your behalf. Please click the link below and share your thoughts.
Share your thoughts on the Bira website