Research from Grant Thornton UK LLP’s latest Business Outlook Tracker research, which looks specifically at 370 leaders of businesses with a supply chain, shows that over half (52%) are finding it harder to operate their business today, compared to 12 months ago. To manage cost pressures, 61% of respondents said that their suppliers have agreed to more flexible (longer) payment terms, and 55% said increasing costs in their supply chain are being passed onto their customers through higher prices for their products/services. 42% of the respondents had already increased their prices, with a further 51% planning or expecting to raise prices this year.  This increasingly challenging operating environment has been fuelled by headwinds such as commodity prices, increased trade administration, energy costs and political uncertainty. Building a resilient and agile supply chain is now a top priority for 57% of respondents, with around 48% saying that their business did not have a good enough understanding of their business’s supply chain to be able to respond quickly to disruption over the last 12 months. The top risks to mid-market supply chains were identified by business leaders as cyber security, Brexit disruption, ethical breaches by suppliers and rising inflation. Sue Knight, is a partner and practice leader at Grant Thornton UK LLP in the Midlands. She says business leaders should keep action simple and practical, first creating a risk benefit analysis and then finding opportunities that have the most buy in and can be actioned quickly. She says: “Businesses in the Midlands need to take a risk and profitability-based approach to their supply chain as changes that affect businesses are happening constantly, whether you are prepared or not. Business leaders should take time to identify the most likely and damaging risks to identify improvements that can help build resilience, increase supply chain predictability and reduce supplier risk. They should then add analysis of profitability to the picture, which will help to identify the most resilient products and customers. “It will likely take 18-24 months for organisations to make any meaningful changes to their supply chains, and this timeline will depend on the maturity of the supply chain approach. The Midlands’ businesses should plan for 12 months at least to put systems in place. Look for simple steps that you can action right away, such as measuring and mapping, as many improvements do not need large investments. “Finding the opportunities that have the most ‘buy-in’ and investment from the business is also vital.  For example, if your internal ESG strategy isn’t in order, then your supply chain will be a long way off.  Identify which initiatives bring business benefit and are either established, or will be supported in your own business, and focus on those initially.” Five actions businesses can take to build sustainable supply chains Use data as much as possible You should use relevant data to identify risk, map the supply chain and identify existing profitability by product, country or customer. This will help you to make and prioritise decisions in the supply chain – whilst knowing the cost impact of the decisions. Identify your ESG priorities All supply chain activity is underpinned by the growing ESG agenda. Often, prominent ESG risks are in line with general supply chain risks, such as location of suppliers. Also, lenders and other stakeholders are more likely to support businesses with strong ESG cultures – for example by offering lower lending rates. Lenders and other stakeholders will increasingly look to ESG reporting and adherence to regulation, so having data ready, even before they ask, will be key. In addition, your supply chain partners need to be able to provide you with assurance that they are operating in line, not just with regulations, but with your standards, and in an objectively ethical manner. Get visibility of tax and reporting policy Tax and reporting policies are designed to raise revenue and change behaviours of businesses.  You need to keep on top of the direction of travel in the key territories in your supply chain. More taxes are likely to be introduced relating to sustainability – such as plastic packaging taxes and, most significantly, carbon taxes and pricing mechanisms. These taxes will add significant costs into your supply chains that you may not yet be aware of or have planned for. Understand how tax and reporting sensitivity scenarios can be built into the data you are already collecting and ensure your suppliers are doing the same You will start to feel pressure from larger customers to adhere to their reporting requirements, perhaps even internationally. TCFD and EU initiatives will play a bigger role – many businesses are not compliant today and need to do more. If you feel you are behind, that is ok, as there is time to catch up. Start by reviewing the data you are already collecting and identify the gaps in terms of supply chain and ESG. You also need to ensure that all the suppliers and partners involved in your supply chain, from start to finish, are transparent, that they’re adhering to legislation and that you get early visibility of potential cost increases. Educate your business on emissions Findings from the Business Outlook Tracker around COP26 last year showed that 1 in 3 mid-market businesses in the UK had not calculated their carbon emissions for the year, and half (49%) had not set a net zero strategy. It is vital that all parts of your business understand emissions (internal and external) and their impact on the environment. If you haven’t already, you should begin by measuring your impact in terms of Scope 1, 2 and 3 emissions.

With nominations OPEN for East Midlands Business Link’s prestigious Bricks Awards, now is the time to reward and recognise your teams by submitting an entry. Celebrating the region’s property and construction industry, award categories include: most active estate agent, commercial development of the year, responsible business of the year, residential development of the year, developer of the year, deal of the year, architects of the year, excellence in design, sustainable development of the year, contractor of the year, and overall winner. Winners will be revealed at a glittering awards ceremony on Thursday 15 September, at the Trent Bridge Cricket Ground – an evening also providing the chance to forge new contacts with property and construction professionals from across the region. Dan Stack, director at Chevin Homes, reflected on winning an award at the 2021 event: “We were absolutely delighted that Chevin Homes has been recognised and the Chase Farm scheme awarded as Residential Development of the Year. A great night away enjoyed by all and this award is a fitting reward for the team effort to create this bespoke development.” To submit a business or development for the East Midlands Bricks Awards 2022, please click on a category link below or visit this page. Thanks to our sponsors:                                      

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The East Midlands’ unemployment rate remains the second-lowest in the country after falling for the fifth consecutive month. It was 2.7% for the period between January and March 2022 – a full percentage point below the national average, which was the lowest since 1974, and only higher than Northern Ireland (2.3%), according to the Office for National Statistics’ (ONS) regional labour market figures. However, the region’s economic inactivity rate – which measures the proportion of 16 to 64-year-olds who have exited the labour market for reasons such as retirement, caring duties, long-term ill health or studying – continues to climb to 21.9%, up by 0.8 percentage points from a year earlier and above the 21.4% national average. Despite the low unemployment rate, the ONS said the number of people in jobs was still below pre-COVID levels, while regular pay fell by 1.2% when adjusted for the impact of inflation, which hit a 30-year high at 7% in March. East Midlands Chamber Chief Executive Scott Knowles said: “At first glance, the unemployment rate falling for the fifth month in succession to hit yet another record low is hugely positive for the region’s labour force. It is largely testament to the success of our businesses in steering a strong rebound for our local economy as they got back to what they do best once COVID-19 restrictions were repealed. “However, these figures disguise a historic hiring crunch facing many of our companies. The Chamber’s latest Quarterly Economic Survey showed that while 63% of East Midlands businesses attempted to recruit in the first quarter of 2022, four in five (80%) of this cohort encountered problems with filling vacancies. “In an increasingly tight labour market, competition for skills is ramping up wage costs, leaving many firms unable to recruit the people they need given the other increasing overheads they face, such as energy and raw materials. “Recent increases in economic inactivity have been driven by those aged 50 to 64 leaving the workforce, according to the ONS, so it’s clear we need to find pathways to get younger people into industries including manufacturing, construction and engineering, which are among those struggling the most in recruitment. “With the economic recovery now on a knife-edge – as illustrated by national GDP shrinking by 0.1% in March – it’s imperative the Government does more to help people access retraining opportunities for in-demand jobs. Introducing a new skills tax credit would also incentivise employers to invest in training so we can grow our next generation of skilled workers.”