Crunch time not here yet
THE credit crunch backlash has cracked the confidence of Teesside businesses, according to the latest nebusiness poll.
Two out of three respondents believe the worst is yet to come, as a combination of spiralling food, fuel and energy prices and consumers’ diminished spending power have dented business optimism.
David Fox, managing director of David Fox Transport in Grangetown, said fuel prices were hitting hauliers hard and has called for the Government to increase confidence by introducing an essential user rebate for cash-strapped firms.
He said: “Large companies are as vulnerable as small ones and we need sensible dialogue between the haulage industry and Government officials to see how we can reduce these costs.
“We are having to pass on costs to customers.
“If companies don’t do this they could go out of business.”
While fuel is the most pressing burden on hauliers, the squeeze on consumers’ disposable income is hitting the retail sector particularly hard.
Jason Kidd, office manager for Darlington-based retailer of carpets and hard flooring, Fisher Carpets, said he had witnessed a decline in footfall in the past 12-18 months.
“We’re trying to come up with attractive offers but there’s just not the same volume of people coming through the doors.
“Business is flat and things could get worse before they get better.”
The latest CBI survey said sentiment had deteriorated nationally across the services sector in the last three months, with volume of business falling by a balance of -44% - the lowest since November 2001 (-59%).
Alastair Thomson, chairman of the Tees Valley branch of the Institute of Directors, said the picture was unlikely to change in the short term.
He said: “It will be harder going for businesses in the service sector, such as restaurants and pubs.”
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