Overheads are Increasing says the Company Formation Sector

Prior to the general election, David Cameron caused quite the stir in the company formation sector as a result of his claims that company formation in the UK is extremely expensive and overly complex.

Many business experts, including the CEO of Companies Made Simple, came out to discredit Mr Cameron’s statement, explaining how company formation in the UK is cheap – as little as £16.99 – and quick – companies can be formed in just three hours. However, all this time it seems that the government should have been concentrating on a different challenge facing enterprise in the UK; the spiralling costs of business overheads.

A recent report, from price comparison website ‘Business Switch’, found that, on average, the utility costs for companies in the UK have risen by a resounding twelve per cent over the last year.

Among the most expensive utilities are business broadband and electricity, both of which have risen by six and four per cent.

However, as the figures of this report have been announced, Sarah Burton -the Head of Purchasing at business consultancy firm ‘CPMG’ – has come out to offer an alternative solution to the issue. She comments;

“The minute we take on any new client we immediately ask for a detailed account of their cash flow. If we are to make any company more cost effective and ultimately more profitable, it is vital we have an in depth understanding of how they purchase as a company.”

“On the whole we uncover that the company has been spending enormous amounts of money on overly priced services and utilities, just because nobody has taken the time to review and compare the costs of these service in comparison to other deals on the market. If I was to give a company formation owner one piece of advice which I think would improve their company’s profitability it would be to review their current service and utility spend, research alternative deals on the market and – if necessary switch service providers.”