Small firms ripped off by ‘greedy suppliers’
1 min read
Small businesses are forced to pay "greedy suppliers" up to three times more than their larger counterparts for the same goods and services. That's the finding of research out today (7 September), which claims that small firms are being overcharged by £3.6 billion.
B2B group buying website Huddlebuy.co.uk found that a typical UK start-up faces an additional bill of £1,200 each year per employee compared to established larger businesses.
"The results of this research are simply shocking," said Saurav Chopra, CEO of Huddlebuy. "Small businesses fighting desperately to survive in harsh economic times are being ripped off by greedy suppliers, while big businesses enjoy huge savings from their favoured suppliers."
Worst offenders include professional business services, transport and IT/communications.
Key findings include:
•Businesses with fewer than 10 employees across a range of crucial industries are being overcharged by £3.6bn a year.
•On average, these small businesses are spending £1,285 more per employee than they should be each year (with some businesses having to spend £4,000 too much).
•Small businesses typically pay more than double what they should on a range of everyday services. In many cases they are missing out on discounts of as much as 70%.
•These small businesses are the lifeblood of the UK economy, employing more than 4.5 million. Without the huge burden of higher costs, small businesses could employ more people.
Regional hot spots, according to Huddlebuy, include London and the South East (£1.3bn overcharge per year), the East of England (£390m) and the North West (£368m).
Huddlebuy's survey was carried out during the period January-June this year.
