The UK is regarded as an affordable country for starting a business, according to statistical data from Visual Capitalist. However, despite start-up costs being, on average, 1%-2% of monthly income, to say the UK is a cheap place to do business would be a stretch [1]. With the cost of energy high in 2023, soaring interest rates and, of course, business rates on commercial properties accounting for 50% of property costs, keeping a business profitable isn’t easy. Particularly during tough economic times.
There are various ways to save money and reduce your costs as a business owner. The other way to combat the cost of doing business in the UK is to make more money. This, of course, is stating the obvious. Every business owner wants to make more money, but that’s not easy. There are 101 ways to increase a company’s profit potential. One method that more than 50% of business owners see as potentially effective is hiring foreign workers.
Hiring Workers from Abroad Can Offset Rising Costs
According to a survey conducted by small business lender Iwoca, 52% of business owners think that hiring foreign workers would not only be good for their company but the UK economy. Hiring workers from outside of the UK isn’t a cost-free exercise. Home Secretary James Cleverly announced in December 2023 that the minimum salary for foreign skilled workers is going from £26,200 to £38,700 in spring 2024. Other changes to the skilled worker visa include removing the salary discount for in-demand roles and allowances for bringing dependents have been scrapped.
Put simply, the costs of employing skilled workers will increase in 2024. The changes also demonstrate the need for expert advice when it comes to navigating the skilled worker visa system. Any company wanting to explore this area needs to work with qualified solicitors. Experts in the field can not only walk business owners through the process but advise on whether skilled worker visas are a suitable option. Assuming businesses can cope with the costs, skilled workers can open the door to new ideas and opportunities. Aside from being skilled in their respective fields, foreign workers can provide insights into business practices from their own country.
When You Can’t Cut Costs, Make More Money
They can also help broker deals abroad and, overall, inject a fresh dynamic into a business. That’s just a few ways skilled foreign workers can help businesses improve their bottom line. Is that enough to offset the costs of doing business in the UK? This obviously depends on the business. As a property website, we know that renting commercial premises in the UK isn’t cheap. In addition to the charges a landlord levies on a commercial tenant, there are business rates to contend with. The small business multiplier has increased by 3.3 pence to 49.9 pence since 2018 [2].
A business can’t avoid these costs. Therefore, finding ways to make more money is essential. This could be as simple as improving the product you sell, carving out new opportunities or, as we’ve said, hiring skilled workers from abroad. Business owners always think about cutting costs when profitability becomes an issue. However, when certain costs can’t be avoided, such as rent and business rates, looking for different solutions becomes necessary. That’s how successful businesses thrive, even during tough economic times.
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