A new survey by the Federation of Small Businesses (FSB) shows that around a quarter of small businesses (24%) plan to close, downsize or restructure in the next year in response to the ongoing energy crisis.
This figure rises to 42% for accommodation and food firms and 34% for wholesale and retail businesses.
The study claims that small firms' survival will depend on the levels of Government support given after the energy bill relief scheme (EBRS) ends in April 2023.
Nearly half of all small businesses (46%) said they have passed on soaring costs to their customers, with 44% considering raising prices further once the scheme ends.
Meanwhile, around one in five respondents (18%) told the FSB that they would need to keep their prices the same to stay affordable for customers. A third (30%) said they expect to cancel or scale down planned investments in the next year.
FSB national chair Martin McTague said:
"Our research indicates that small firms are being held back from investment and are at the brink of collapse because of sky-rocketing energy costs.
"It's important that the government provide certainty to small firms for the long-term as they can't plan on a six-month horizon."
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