New Year, New Challenges, and Change

By SME Insurance

Posted 11/01/16

The New Year is often a time to celebrate and reflect on your business successes and plan for changes you may wish to make for the year ahead.

Last year the election of the first majority Government since 2005 had impacts on small businesses and changed the business landscape. The Chancellor has called for the UK to become “a higher wage, lower tax, and lower welfare society” and businesses will have a key part in helping deliver this. In 2016, we will see the introduction of new policies such as the National Living Wage, the roll out of workplace pensions across small businesses, changes to dividend taxation, and the introduction of the Apprenticeship Levy.*1

Some businesses may find it difficult to afford to pay a minimum of £7.20 per hour (for over 25s) and will need to consider this increase in the planning process. *2 The changes will require businesses to adapt and make the necessary amendments to ensure they are compliant. Each factor is likely to bring about its own challenges but it is also important to consider the opportunities they may present.

Unfortunately some business owners were faced with a major challenge to start their year, as the Christmas floods had a devastating impact on some businesses across the country.  Daphne Eddington, a small business owner, spoke about the devastation the December floods had on her business in Cumbria.

"The damage to our shop was catastrophic. Water had entered through the front door, the windows, up through the toilet and from beneath the floor. By Friday, the army had arrived and loaded the sad heap of rubbish that was the shop’s contents and our livelihood on to council-provided skips."*2

Floods then devastated homes and businesses in the north and west of the country across York, Leeds, and Manchester on Boxing Day. The cost of the damage is predicted to reach £5 billion. According to accountancy firm KPMG, business losses could reach £100 million.*2

We have seen business owners take adversity in their stride and once they are back up and running the fresh start may bring about new ways to operate, such as finding new products and services that may not have been considered previously. However, this may not be possible for business owners who were not adequately insured.

To ensure that you have the correct level of insurance for your business, speak to an insurance broker who can play a key role in sourcing an adequate policy. The devastation caused by the recent floods highlight just how important insurance is to a business.

*1 The Federation of Small Businesses http://www.freshbusinessthinking.com/new-year-message-from-the-federation-of-small-businesses/

*2 The Guardian http://www.theguardian.com/small-business-network/2015/dec/29/2015-year-small-business-news-views-vat-storm-desmond 2015: a year in small business news and views.


Figures correct at time of writing.

Posted 11/01/16

Author: SME Insurance

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