Rising fuel prices are squeezing Yorkshire's SMEs: Rashmi Dubé
It starts with a fuel receipt. It ends with a business that cannot understand why the numbers no longer add up. Across Yorkshire, small firms are watching their margins erode.
Rising oil prices are the headline, but the damage they do runs far deeper than the forecourt. For thousands of small businesses in the region, the real threat is not what they pay at the pump. It is everything they never thought to measure.
When oil prices rise, freight and logistics costs follow almost immediately. Hauliers pass increases on to distributors, distributors pass them to suppliers, and suppliers pass them to you. By the time the cost reaches a small Yorkshire manufacturer or importer, it can represent a 10 to 20 per cent increase in raw material prices with no single invoice making the connection obvious.
For firms reliant on overseas components - and Yorkshire’s engineering, textile and food manufacturing sectors depend heavily on them - this is particularly painful.
Shipping rates spike alongside oil volatility, compressing margins at exactly the moment when customers are least willing, or able, to absorb higher prices.
Employees are also facing increasing personal pressure due to rising living costs and changes in legislation. At the same time, the increasing use of technologies such as artificial intelligence is, in my experience, contributing to a noticeable rise in redundancies.
People are increasingly turned into numbers on an spreadsheet that just need to be cut according to the financial overview. The human cost of economic pressure does not always show up in the headline figures, but it is real, it is local, and it is happening now. The impact is vibrating through the communities.
The oil crises we are witnessing fundamentally means manufacturing and logistics firms are facing the fastest acceleration in input costs in decades, with electricity prices projected to rise by up to 30 per cent and gas by as much as 80 per cent.
Unlike households, businesses have no price cap to soften the blow. Freight and shipping costs are climbing sharply as carriers pass fuel surcharges down the chain, forcing retailers in food and fashion to choose between absorbing the hit or passing it to consumers who are already stretched.
For many smaller firms, neither option is comfortable. High interest rates and broader economic uncertainty are compounding the pressure, with some SMEs already cutting operating hours or facing temporary closure simply to manage their energy bills. Investment and hiring have stalled across the board. In response, some businesses are accelerating shifts toward remote working and renewable energy - not as a lifestyle choice, but as a survival calculation. The crisis is reshaping how Yorkshire firms operate, plan and think about the future.
Yorkshire has never been a region that waits to be rescued, there is something in the character of this place that finds a way. But resilience is not the same as immunity, and goodwill alone will not absorb an 80 per cent gas rise or a supply chain that has quietly doubled in cost.
The firms that will come through this are those that stop measuring only what is obvious and start accounting for everything the fuel price touches — the invoice that crept up, the delivery that cost more than it should, the employee quietly calculating whether the job still makes sense. The businesses that look beyond the pump will map their true exposure and can act before the numbers stop adding up.
Rashmi Dubé is a lawyer, entrepreneur and ESG consultant