However, 50% of respondents believe that the most significant challenge is economic slowdown, which is supported by an annual inflation rate of 6.9% in 2022. The energy crisis and increased cost of living has a severe impact on the economy. To negate financial challenges during inflation, mid-market businesses would need to implement short to medium-term strategies. This issue was covered in the H1 2022 IBR report, where we provided guidance on how businesses can respond to inflation and how they can use technology to increase their profit margins.
Some recommended first steps included managing costs carefully and creatively, buying more in advance to lock in prices, hedging where appropriate, and even looking into reverse auctions, while also attempting to become more effective and accomplish more with less.
This year, we are adding more action plans that mid-market businesses can use to hedge against inflation as depicted by the graphic below - Maria Pretorius, Director – Business Risk Services
