Council steps in with survival help as more firms close amid cost-of-living crisis

By Julia Armstrong, Local Democracy Reporter

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Sheffield Container Park (Photo via LDRS)

Sheffield Council is working to help businesses stay afloat during the cost-of-living crisis, following on from the effect of the pandemic, as the number of closures continues to rise.

A report to the council’s economic development and skills policy committee said: “Business Sheffield’s business information officer team are dealing with business closures and businesses on the brink of closure on an increasing scale.

“More businesses are being faced with bills that they are struggling to pay including business rates and rental agreements on top of increases in energy prices and inflation and supply of goods, especially food supplies, which in turn is affecting local food producers whose orders have in some instances reduced.”

Although city centre footfall has risen, it is not yet back to pre-pandemic levels, the committee heard, and high street businesses continue to struggle. Other sectors among the worst affected are hospitality and retail, the care sector and voluntary, community and charity sector organisations.

The Energy Bill Relief Scheme for businesses ends in six months, so the focus has shifted on supporting some businesses to look at what changes to make and helping others to close safely.

The report said: “For some business owners, business closure will be the right decision from both a financial and personal perspective: the challenges of the last few years means there is an element of fatigue with some business owners, an increase anecdotally in mental health issues and also personal debt.”

Alexis Krachai from Sheffield Chamber of Commerce said there is a difference between coronavirus, which was a public crisis, and what is happening now: “The current crisis is a fundamentally private experience.

“It may well be you don’t feel confident admitting to yourself, your employees or your supply chain that you can’t pay that bill.”

He said that many businesses were able to use the break in normal running during the pandemic to look at how they could pivot their firms to survive but energy bills have risen fourfold since last year and a lot of businesses are not able to cope with that level of increase.

Over the past year, many viable and profitable firms have had to use up their capital resources in order to keep running, he said.

A team of business information officers work across 40 local high streets and 15 shopping precincts, visiting to give help and support. They have supported 1,317 businesses since the pandemic started.

Four recovery action plan advisors, funded through the South Yorkshire Mayoral Combined Authority, two tech scale-up advisors and two growth advisors give specialist advice and support. That includes grants for equipment to increase productivity and money to help with adopting digital technology and carbon reduction.

Committee chair Cllr Martin Smith said: “We’re living in really turbulent, incredibly difficult times but it’s really heartening to see such a range of help being offered and advice, both from council officers and from partner organisations in Sheffield, and as someone who used to run a business, it’s truly, truly appreciated.”