The plight of business owners affected by supply chain chaos

If there’s one thing a pottery business can’t live without, it’s clay. Yet that is the predicament faced by small business owner Myfanwy Gloster, who runs Glosters in Porthmadog, North Wales, with her husband, Tom.

The couple source their clay from Spain via a company in Stoke-on-Trent. But in recent months, stock has proved almost impossible to find, with shipments often delayed at customs for weeks at a time.

Thousands of small business owners like Myfanwy are struggling to source crucial items, due to the war in Ukraine, post-Brexit shipping complications, rising energy costs and manufacturing delays related to the pandemic.

Icing on: Lynsey Bleakley fears losing customers and Drew Cockton cuts costs

According to the Office for National Statistics, around one in five businesses experience a global supply chain disruption.

Everything from printer paper to sunflower oil, flower presses and auto parts are scarce. In some cases, shortages put small businesses at risk and jeopardize the finances of their owners.

Myfanwy has had to dip into her own savings to store clay when she can get hold of it so it won’t run out.

She hopes to be able to repay herself by the fall, and is cutting back on household expenses while waiting to get by.

“Normally we order a ton of clay every five weeks, but we recently bought six tons because we can’t afford to run out before Christmas, which is our busiest time,” she says.

“It cost £3,000 which is a big outlay but we’d rather know we have it in stock than not.”

“When we ran out of clay, we had to cancel some orders because we just couldn’t fulfill them and we had people in the workshop unable to work.”

Lisa Johnson has seen her income from her skincare business, LJ Natural, plunge since Russia invaded Ukraine earlier this year. About a third of its products use organic sunflower seed oil as a key ingredient, including its best-selling cream for eczema sufferers, Scratchy Balm.

However, oil supplies dried up for several weeks when the war began. Now Lisa can get it again, but the price has gone up by more than 50%.

“I’m desperately trying not to raise my prices because my customers are already down and hundreds are relying on my products for their skin health,” says mother-of-two Lisa. “But it’s extremely difficult for me to absorb these price increases and I can’t keep making less and less money.”

Lisa and her family have cut back on expenses, especially sweets like coffee and cake. She says, “The cost of sunflower oil will only increase further.”

Emma Jones, founder of small business support platform Enterprise Nation, believes that while small businesses are facing new challenges, they are well equipped to adapt to the difficulties resulting from the pandemic storm.

“The experience of the pandemic has seen the business world pivot to deal with unprecedented circumstances, so they are used to dealing with ever-changing situations,” she says. “They have the strategies and the experience to handle things.”

Drew Cockton is adapting to rising costs and supply chain shortages at his luxury fragrance company, Owen Drew, by cutting wherever he can.

Drew launched his Liverpool-based business six years ago and last year successfully launched £50,000 on Touker Suleyman’s BBC One’s Dragons’ Den. Drew is planning a major rebranding on the advice of his new business partner. However, he has had to delay it for several months because he cannot stock up on essential items such as paper and cardboard.

The cost of wax, used in the candles he sells, has jumped 40% and supplies take months rather than days to arrive. The price of all the oils and fragrances he uses, such as oranges from Spain and grapefruits from Greece, has also skyrocketed.

“To try to absorb the costs, I’ve put a stop to business expenses such as public relations and marketing,” Drew says. “I also do remote business meetings online rather than over coffee or lunch.

“And I’ve stopped making other purchases because I need capital to buy stocks when I can get hold of them.”

Drew hopes to avoid dipping into his own savings to invest in the business, but will do so if necessary.

“The government needs to get this cost of living crisis under control,” he said. “The beautiful things that make life enjoyable are gradually becoming unaffordable.”

Lynsey Bleakley fears supply issues are costing her customers at her luxury bakery, Bumble & Goose. She had to stop offering popular vegan items because she struggled to get a vegan baking butter she relies on for recipes.

Lynsey, who is based in Groomsport near Bangor in County Down, Northern Ireland, delivers personalized cookies, cakes and brownies across the UK and Ireland and counts John Lewis, Harrods and Charlotte Tilbury among its corporate clients.

“Many suppliers will no longer ship to Northern Ireland or charge exorbitant rates,” she says. “We’re looking for supplies for vegan butter, which is great for cookies, but we can’t source it.”

Lynsey managed to find a supermarket in England that was 20 blocks away and bought the land, but worried she would run out again.

“Our vegan range is small but important to us. I had to pull the range from the website until we got the right ingredients, which meant we could have lost potential customers,” she says.

Tina McKenzie, policy chair of the Federation of Small Businesses, says small businesses need targeted government interventions to help them deal with the current cost of doing business crisis so they can get the goods they need and find affordable prices.

“Help could include reducing taxes, such as business tariffs and increasing National Insurance payments,” she says.

Some links in this article may be affiliate links. If you click on it, we may earn a small commission. This helps us fund This Is Money and keep it free to use. We do not write articles to promote products. We do not allow any business relationship to affect our editorial independence.

About Glenda Wait

Check Also

Fmcg News: FMCG makers expect improved margins and rural sales to return from third quarter as inflation eases

The FMCG industry expects improved margins and hopes for a rural market comeback from the …