Glasgow businesses react to rising cost of living

Sara Capaldi, who owns café/bakery Partenope in Shawlands, has said that she is not only spending more to supply her business but is concerned she will lose out even more if people will not be able to afford the luxury of eating out.

She said: “The rise in costs is really starting to worry us. Our weekly shop has already increased by quite a substantial amount.

“It’s not as simple as increasing prices on our side as going out for coffee and cake is already a luxury. If we increase prices people will come less often anyway.

“We have noticed a huge rise in people working remotely from the shop, probably to avoid energy costs at home.”

Sara Capaldi with her partner Toni de Carlo. (Image: Newsquest)

Recent business surveys show the UK’s hospitality industry is facing major rises, including a 19% increase in labour costs, and 17% and 14% rises in food and drink prices respectively.

Meanwhile, VAT has increased from 12.5% to 20% as of April 1, which UKHospitality warns will result in a ‘tidal wave’ of double-digit increases impacting both consumers and operators.

With energy bills expected to leap by 95%, Sara feels that this is a major concern for Partenope as she has to provide hot food and coffee.

• READ MORE: Meet the owners of new Glasgow Partenope bakery in Shawlands

She said: “The rise in energy is actually a bigger problem as we can’t avoid using ovens and the coffee machine. We have no lighting on our signs and turn our lights off at night-time so again, we are fighting a losing battle.”

Sara feels the pressure to help her staff with the effect that the rise of National Insurance and overall cost of living will have on people’s livelihoods.

She added: “None of our staff are on minimum wage anyway but with the rise of National Insurance and general cost of living I feel an enormous amount of pressure to keep everyone’s job safe, even in a very uncertain climate.”

Sara Capaldi.

Sara has decided the only way that she can do this is by opening Partenope on a Sunday, therefore working seven days a week, and hoping the extra income will balance the rise.

She is trying to remain positive despite the economic uncertainty but cannot shake the worry that small businesses like hers will badly struggle.

She said: “For the moment we are hoping the Sunday trade will keep us floating and we will see what the future has to bring.

“If everyone puts their prices up it’s us little guys that are going to suffer. One coffee a day can make a huge difference to little places like us.”

Sara Capaldi and her partner Toni de Carlo.

Meanwhile, a local hairdresser shares the same concerns and has already noticed the impact of costs rising.

Danielle Ferguson, who runs Flawless by Danielle on Tollcross Road, said: “I think we’re all worried with prices increasing so high. With electricity and gas bills more than doubling, that is a huge increase and even for me myself at home.

“At the salon, my monthly electricity bill has nearly doubled, and we were not any busier than the month before. It is quite scary.”

Danielle fears for how the beauty industry will cope with increases, as the services she offers are already deemed luxuries.

• READ MORE: Kind-hearted hairdresser Flawless by Danielle in Glasgow's Tollcross gives free cuts to people in need

She said: “Treatments for yourself like getting your hair or nails done, they aren’t essential they’re just treats and at one point in this crisis we are in people are going to have to cut back. It’s going to affect the beauty industry completely.”

Danielle Ferguson of Flawless by Danielle.

Danielle has had to fork out more for many of her products, with her colour provider having to increase prices considerably, and she is stuck in a situation where she cannot decrease her prices by much as the salon’s outgoings are increasing.

She said: “Although we want to put our prices up to survive, we’re going to be stuck. We can maybe put up a few pounds.

“For some people getting their hair dyed is essential, and people who need their colour done can’t afford to pay £60-70 and will pay a fiver for a box dye. Things like this will crash us.

“Being a business owner, I’m going to have to work extra days to cover more bills and I will be working for no money extra time. But as long as my girls have their hours and the bills are paid, I am happy."

Danielle Ferguson.

Danielle is hoping that she can survive the next few months with the help of her clients, and in return try to help them too.

She said: “We are small businesses, and I think I speak for the whole East End when I say that we rely on our regulars. If it wasn’t for them, we wouldn’t have survived the pandemic.

“We’ve ordered loyalty cards with discounts and maybe they can a free blow-dry or 20% off colour, or something like that.

“We’re going to help them as much as possible because they’ve helped us.”

UKHospitality CEO Kate Nicholls said: “Given the unfolding cost-of-living crisis for consumers and soaring operating costs for businesses the return to 20% VAT for the sector will prove nothing less than catastrophic.

“The now inevitable price rises for consumers will dampen demand and many hospitality businesses – one in three having less than a month of cash reserves and most are carrying heavy debt burdens – will fail as a result. This can only cause the UK’s wider economic recovery to falter.

“If the sector is to have any hope of playing its full role in fuelling the UK’s recovery then we need support.

“We will continue to work closely with the government to achieve the best possible trading conditions for the industry, keep pushing for reform of fundamentally unfair and crippling business rates, play our role in solving our workforce crisis and persist in making a case for the clear benefits a permanently lower rate of VAT will have. A move which has support not just from UK consumers but a significant number of MPs as well.”