As if the year hasn’t been tough enough for companies in all sectors, evidence is emerging which suggests that half of all consumers confessed they have haggled for an essential product or service this year.
In a report that underlined the impact of the cost of living crisis on shopping habits – and one that saw a 14-year high in insolvencies – two in ten said they thought it OK to haggle when buying from an independent retailer or small business owner and a third are planning to do so to save costs this Christmas.
The most effective hagglers have saved up to £200 – while one in ten has saved over £500.
Davison: need to be prepared
What drives this attitude? Respondents to a recent survey suggested it was justified as a price match if the item is cheaper elsewhere or if it was high value like a car or piece of technology. Others suggested paying in cash was also deemed an acceptable reason
And while slightly more men than women were up for it, those most likely to do so were those on higher incomes. There was even a regional aspect with shoppers in the West Midlands most likely to have haggled.
The findings were significant, according to Todd Davison, MD of Purbeck Personal Guarantee Insurance, the firm which commissioned the research.
“Haggling has not been part of our culture in the UK,” he said, “particularly for essential items, so this survey really demonstrates that people are shaking off their British reserve and trying their luck to help mitigate rising living costs.
“With one in five believing a small business is an acceptable target for haggling attempts, business owners will need to be prepared as the countdown to Christmas commences.”
While 2023 may well have earned unwanted recognition as the most challenging year for businesses since 2009, particularly in the wake of the global financial crisis, the latest official figures show that between July and September, there were 6,208 registered insolvencies across England and Wales.
High interest rates continue to restrict many businesses from accessing the cash they require, at a time when cash flow is crucial
At a time of high borrowing costs, rolling up of government Covid support and a slowdown in demand, the odds have been firmly stacked against UK businesses throughout 2023.
But one expert said business can be buoyed by a brighter outlook for 2024 as technology is set to offer further relief and stem the rising trend of company insolvencies.
Quigley: difficult year
Lynne Darcey Quigley CEO of Know-it, said: “There’s been no shying away from just how difficult this year has been for business owners. Although insolvencies have risen, signs of promise, such as the recent fall in inflation, will be positive news for many as we look towards the new year.
“Business owners will welcome the [recent] fall in inflation, but hurdles remain in the way before the threat of insolvencies can be mitigated. High interest rates continue to restrict many businesses from accessing the cash they require, at a time when cash flow is crucial to business survival.
“Looking ahead to 2024, technology will have an important role to play in helping businesses. Manual processes and human error often lead to companies losing out on both time and money – commodities which business leaders cannot afford to lose cheaply.”
She added: “Placing technology at the centre of business strategy in 2024 will prevent the insolvency rates from reaching the highs we witnessed in 2023. External economic factors such as interest rates and inflation remain a mixed bag, meaning business owners must be proactive when protecting themselves against the challenging conditions they continually face.”
Recent research from Goldman Sachs predicts a brighter outlook for the UK economy and its business community in 2024. It is estimated that the economy will expand above expectations, and interest rates and inflation pressures are expected to decline too.
Separately, Bromsgrove has been identified as the local authority where small to medium enterprises are struggling the most, according to a study by Qardus, which analysed ONS data to find it recorded a -30.22% drop in businesses being registered between 2021 and 2023 – the biggest drop of any local authority.
Rochdale ranked second with Worcestershire third. At the other end of the scale, Ceredigion saw them thriving the most followed by Selby, South Staffordshire and South Hams.
Qardus founder Hassan Daher, said: “What is interesting to note is that no London based local authority ranked in the top ten, suggesting that it is difficult for SMEs to start out successfully in the capital.”
