Small businesses in Cardiff feeling huge pressure from rising energy costs, with some shops having to switch fridges and freezers off in an effort to save money. The effects of the cost-of-living crisis on families and individuals has been well documented, with councils across the country - including Cardiff council - opening up some of its buildings as dedicated hubs where people can keep warm.
However, soaring energy prices are also beginning to have a major impact on small shops and businesses. Tweedsmuir Road in Tremorfa is just one area of the city where local businesses are beginning to feel the crunch. Ruhail Shahzad, who runs Tremorfa Superstore, said he has seen his electric bill go from about £900 a month to nearly £4,700.
He said: "It is having a huge impact because obviously it is stress on my wife. She wakes up at night-time thinking how we are going to cope with electric bills. It is taking a toll on my children because we are always discussing - sometimes it turns into an argument." Ruhail said he has had to resort to switching off some of the lights and most of the fridges and freezers in his shop.
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The freezers were emptied before they were switched off and the fridges that need to keep certain products cool, like dairy products, have been kept on. They have also kept one chilled drinks fridge switched on. Ruhail lives above the shop with his family. Unfortunately for them, this means they have one energy meter, which is classed as a business meter. As a result, Ruhail said they lose out on vital government support.
"My children have actually resorted to trying to save by turning lights off at night in their bedrooms and putting candles on," he said. "At one point, my daughter burnt her hand putting the candle out because melted wax went on her finger. It is dangerous because I think this is a way of life going forward that a lot of parents are going to be doing."
As well as the soaring energy bills and having fewer customers coming through the doors - due to their own struggles with the cost-of-living crisis - Ruhail said there are numerous "hidden costs", not to mention having to pay staff, that are also having an impact. He added: "We have got council tax, we have got business rates, we have got water and on top of that, the spiralling cost of diesel.
"Then we have got insurance costs and I have got insurance on the property. I think customers are not aware. They just come in, they buy a product and think 'wow, the size of the shop, you must be making money', but if only the customers came on the other side and have a look at the day-to-day costs I think they would be horrified."
Another issue Ruhail and other small shops like his have to deal with is the rising costs at cash and carry businesses. Aside from the fact that some products are only available to some of the larger stores, smaller shops like Tremorfa Superstore are being left with smaller margins - the difference between the price they are paying at cash and carry and the amount they are selling the product for - which cannot keep up with ever-increasing costs.
Ruhail said: "The biggest problem that we are having now is price-marked items. Customers see it, they are happy to pay that. They are not happy with the price, but they are still happy to pay because they can't argue because it is written in black and white. What they don't realise is that every price marked item is determined on the margin which is given to us and that is not enough for us to sustain and keep going.
"None of the price marked items give us a little bit of leeway, but then again we are stuck because those products you can go easily into the other stores and pick them up half the price than what we have." Ruhail, who said he will be "surprised" if his business is still going in six months, added that he knows friends and family in Cardiff who are facing the same situation.
He said: "They are feeling exactly the same. I have got family members, some of which are nearly at a nervous breakdown because they can't cope because of the costs." Parking is also a factor that Ruhail said is having an impact on bringing customers in through the door. "Parking where I am is an absolute nightmare," he said. "I don't understand why the council can't give us bays because what we have got is single parking and once you get a customer who parks there, he is allowed to park there all day.
"Where I am allocated and a few shops on the road next to me, customers will carry on driving past us and go further down and do their shopping, so we actually miss out on generating our customers and the cashflow because there is nowhere to park."
Mohammed Nawaz, who runs The Golden Fry, said the amount he spends on energy has nearly tripled. Where he used to pay £500 a month, he now has to fork out just over £1,200. He said the "pressure is really on" now for his business. We are down to one fryer, so we are trying to cut that way. They are all electric and gas, so there is nothing really that we can cut back on. You have to keep them on, otherwise the food will go cold. The oil has to be kept to a temperature. You can't fry stuff in cold oil."
On what business has been like recently, Mohammed added: "I have lost about 30% of the business already. They are just not coming in. Before, I would open up at five o'clock and have a queue going out. Not anymore." I think everybody is in the same boat. They haven't got the money to spend, so for that reason... people are just holding back in case of emergencies."
There are other options for Mohammed, but he said he has already invested about £90,000 in the business - something which makes walking away too difficult. He said: "At the moment I am just worried - stressed all the time. If I don't get anybody coming in, then... I think I could go into depression just worrying about it. You are thinking 24/7, 'what else can I do?'. I have tried to take other options and then I am thinking whatever I have got is all tied up in this business."
Like Ruhail, Mohammed said the cost of stock has also gone up significantly. He said: "Stock is very expensive now. I would say at least between 30% and 40% it has gone up. That is a lot. The oil used to be £18. Now I am paying £29." A couple of doors along from The Golden Fry is Atlantic Bakery. Operations manager Nick Tucker said the business is also feeling the pressure with major energy price hikes.
Nick said the business has not had the benefit of being able to switch off its fridges and freezers in order to save money. He said: "All of our stock has to be chilled and frozen. So obviously we need to keep them on at all times. And it is a massive increase in our costs. Our electric has gone up a couple of thousand pounds a month. From where we were probably paying an average of £1,500 a month, it is near enough £4,000 - £4,500, plus obviously fuel costs, plus the minimum wage.
"We have probably managed to put maybe £1,000-£2,000 on to our costs, but we can't do any more, so it is really difficult and at the moment, as a business, we look to survive and if we break even I think that is all we can hope for at the moment. Staff get paid, our customers have the service, but from a business owner's point of view, we don't make money and people might think that is hard to believe, but we live on our savings - what is left of it - and making a profit at the moment is not the case."
As is the case with many businesses, Christmas is an important time for Atlantic Bakery, with much of the profits seeing the business through the early months of the year. However, Nick thinks the business will break even "at best" at Christmas and lose money in January, February and March. When asked if he doubts where the business will be this time next year, Nick added: "It depends how long we put up with making no money. That is the bottom line. At the moment, we have a few savings. We are surviving.
"You can only keep paying your staff and bills for so long before you say 'where does it end?'. I would like to think that yes, we will survive and we will see it through, but we monitor it daily and that is the state of where we are and I think all businesses are." On the claim that the difficulty of parking along Tweedsmuir Road is having an impact on businesses there, a spokesperson for Cardiff Council said: “These claims have been looked into and it is clear that there is unrestricted parking available in front of the shops and on adjacent streets, with a relatively high turnover of spaces.
“The unrestricted parking available in front of the shops could benefit from restrictions on the length of time someone could park in these spaces, but when compared to other areas of the city, with the budget that is available, it wouldn’t qualify as a priority scheme.”
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