Extreme weather top business worry for 2016
Extreme weather events have been named the top fear for businesses going into 2016. Almost a quarter (23%) of SMEs polled in Barclays’ 2016 Hopes & Fears survey listed extreme weather as a factor that they feared could have a negative impact on their businesses over the course of the next 12 months.
Money and funding constraints came second, being flagged as a concern by 20% of respondents. Just under one in five (18%) named competition among similar businesses as a worry for 2016.
The recent spate of floods, centred in northern England and Scotland, have certainly emphasised how devastating extreme weather events can be to affected businesses. The Scottish Government has announced that businesses and households are to receive £1,500 grants to help with the damage, with businesses whose ability to trade has been severely affected by flooding able to apply for a further grant of £3,000. Many businesses in Scotland and England face far higher bills than this however.
The Association of British Insurers (ABI) reports that insurance claims for damage caused by this winter’s floods so far are likely to reach £1.3 billion, with the average claim totalling £50,000. This includes both household and business claims but many small businesses are finding it increasingly difficult to secure affordable flood insurance.
The Flood Re scheme, which comes into effect in April, is designed to recycle an ‘insurance tax’, levied on all household premiums, into providing affordable flood insurance to those most at risk. The scheme applies only to domestic properties however, which could leave at-risk businesses in danger of facing company insolvency ifthey lack the funds to deal with extreme weather events.
Despite these worries, UK SMEs also found plenty to be positive about. 39% of those polled in the Barclays survey said the availability of better technology would have the biggest impact on their businesses over 2016.
Almost a third (32%) cited consumer demand as the most important factor for growth while a quarter of businesses were focused on international opportunities and growth overseas. Major sporting and cultural events like the Rio 2016 Olympic Games also have the potential to have a positive impact according to the study.
By Phil Smith