Last week there was another round of suggestions that the Bank of England might raise interest rates sooner than expected. Following up from our previous story about China, we thought we would take a look at what a rate rise would mean for British businesses, and offer some recommendations to help your business prepare.
The BoE policymakers are confident that the UK can weather the storm that has engulfed China, and had knock-on effects in Brazil, Russia and the US. Beyond that, they believe that problems in the Eurozone won't affect the UK as badly - especially if Britain leaves the EU. This means that now may be the time to focus on your domestic market. Your business will be safe from turmoil abroad if you're able to find customers locally.
Beyond that, higher interest rates may mean consumers will be more likely to save their money. Now, this is great if you're a bank or a pensions company, but a problem if you're a retailer. You'll need great offers to entice customers out, and if that allows you to steal a march on the competition, that's all the better.
Finally, it may help you in the long run to save more of your company's own money. Because rates are only likely to rise when the economy has fully recovered and the BoE don't think it's at risk, your day-to-day operations may be able to continue as normal with you saving a higher proportion of your income than you are right now.