Across the UK, businesses and individuals alike are feeling the effect of rising living costs.
The global energy crisis – a result of supply chain issues, increased demand, and disruption caused by COVID-19 – coupled with the rising cost of fuel and consumer goods is putting a strain on Brits. Inflation has reached new heights, as recorded in December 2021, as the Consumer Prices Index (CPI) soared by 5.5% from the previous 12-month period – a record high since the National Statistic series began in 1997, according to the Office of National Statistics. Moreover, in March national insurance contributions were increased by 1.25%, so Brits will be expected to pay increased tax going forward. All in all, it’s thought that the living cost for the average UK household will increase by about £125 per month, adding significantly to the expenses that Brits will have to pay this year. Among the many problems that the rising cost of living poses, this is expected to affect how Brits prioritise sustainability when making purchasing decisions. Global hygiene and health company Essity conducted a study that showed the effect of the rising cost of living on Brits’ attitudes towards sustainability. The study showed the majority (64%) of Brits wanted to shop sustainably but were concerned that the rising cost of living would prevent this. In the survey, 26% of respondents said they wouldn’t buy organic/ethical products if they were more expensive, while 33% said chipping away from their sustainable living budget would be one of two principal sacrifices – along with expensive/luxury products – that they’d be prepared to make. This is in contrast to a previous study – also conducted by Essity – that showed 45% of Brits were open to paying a premium in order to consume more sustainably for the sake of the environment. However, with 62% of respondents admitting that they’re unsure if they can afford to maintain their current lifestyle with the rise in living costs, this isn’t too surprising.
On the plus side, 91% of those polled that had already implemented sustainable changes in their lives said they would continue to live sustainably despite the rise in living costs.
So, despite the toll that rising living costs are likely to take on the lives of Brits, it looks as though sustainability still remains a top priority for consumers, even if some are hesitant to pay more for more environmentally friendly products. Aside from the impact on individuals, businesses are similarly struggling under the weight of the increasing costs to operate, being particularly affected by the rising cost of energy, employees’ increased salaries, heightened taxes, and – for many businesses – a reduction in demand. Likewise, many businesses reliant on paper and packaging have been affected by increased delays and costs as a result of the UPM paper mill strikes, which have been active since the beginning of the year. In fact, as referenced by the Addleshaw Goddard Scottish Business Monitor report, it’s thought that 1 in 5 businesses will scale down business operations as a result of the increased cost of operations, especially energy costs. Despite this, businesses must adhere to environmental protocols and work towards the country’s sustainability goals, as well as appeal to the increasingly eco-conscious consumer, particularly in light of the COP26 conference that took place at the end of 2021. With this in mind, for businesses to thrive in 2022 they need to be able to provide customers with affordable products and an assurance that their company is doing the best that it can for the planet.
In addition to reducing energy and fuel consumption where possible – to both keep costs down and reduce their carbon footprint – every level of business needs to be optimised, from production to packaging.
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