Cost of living: “The energy crisis is very worrying for patients”

When working with the public there are a few oft-traversed conversational pathways: the weather, holiday plans, school or work.

In more recent years, our small talk has reflected headline-hitting topics like the pandemic, the record-breaking heat wave, or – as of 5 September – our new Prime Minister.

But even those conversations have ceased, practice owner and optometrist Valarie Jerome, told OT, as concern grows around the energy crisis: “No more discussions on the pandemic, the hot summer, or local politics in the consulting room. It is all about how ridiculous the energy bills are going to be.”

“The energy crisis is very worrying for patients,” she shared.

A poll of more than 70 OT readers in August found that 63% had seen conversion rates drop as a result of cost of living pressures.

In the days running up to the appointment of the country’s new Prime Minister, Liz Truss, OT sought to review the situation that faced businesses as the summer ended.

The challenge for small businesses

The cost of living crisis has been an escalating issue throughout 2022, boiling over recently after Ofgem, the regulator for the energy industry in Britain, confirmed an 80% rise in the consumer price cap to £3549 a year. 

This is almost three-times the level of last October and is expected to climb even higher when the next energy cap is introduced in January – with consultancy firm Cornwall Insight forecasting it could reach £5387. 

The situation has been concerning for consumers but, until 8 September, energy tariffs were not capped for companies.  

As news of the consumer price cap hit headlines in late summer, the British Chambers of Commerce (BCC) wrote to the then-Prime Minister, Boris Johnson, the Chancellor of the Exchequer, and the leadership candidates for the Conservative party to propose a five-point plan to support UK businesses.

Shevaun Haviland, director general of the BCC, said: “At over 10%, CPI inflation is at a 40-year high; interest rates are seeing the largest increase in 27 years; and eye-watering energy bills have created a perfect storm of increasing costs. The impact of these challenges on consumers, businesses and wider society cannot be overstated.”

The Federation of Small Businesses (FSB) also called on the Government to introduce support for small businesses.

Martin McTague, national chair for the FSB, said: “Small businesses are left out in the cold when it comes to energy bills.”

“Unlike large corporates, small firms cannot hedge costs and negotiate deals with their large energy suppliers,” he said. “Many of our members say the eye-watering energy bills could be the final nail in the coffin as they struggle to get through winter.”

“The cost of doing business crisis underpins the cost of living crisis. Inaction won’t just lead to spiralling prices but to a generation of lost businesses, jobs and potential,” he added.

OT has been investigating the impact of rising costs on practices and patients throughout the year. As summer ended and following Ofgem’s announcement, OT asked independent practice owners to share their observations of how the situation was affecting business, the High Street, and their patients.  

Valarie Jerome: Valarie Jerome Optometrists, Newbury

Sharing her experience, practice owner and optometrist, Valarie Jerome explained that her practice in Newbury, Berkshire, has not yet seen a rise in energy costs.

“It is a small space – just under 600 square feet,” she said. “But I am bracing for the winter now.”

“I moved here from Florida in 2009 and have never gotten used to cold winters. I am notorious for keeping it really warm in my consulting room all year round,” Jerome shared, adding that this winter may see her don more layers and turn down the electric wall heaters.

In addition, Jerome is looking at ways to cut down on excess electricity used in the office; turning on equipment like focimeters only when needed, turning off plug sockets when devices are not being used.

“I have considered completely shutting down all pre-screening and consulting room equipment during lunch when not in use,” she said. “I’m just trying to think of every little thing that can be done to reduce electricity costs.”

The practice will also not be investing in any more equipment until the new year, Jerome said, and has also downsized on areas like additional marketing – either by reducing the frequency or ceasing them entirely.

“Cutting back has saved my little three-year-old business and kept it afloat during a pandemic,” Jerome shared.

There is a lot of worry with local business owners

Asked about the picture for businesses on the High Street, Jerome, who is a member and director of the local Business Improvement District, shared: “There is a lot of worry with local business owners.”

“Hairdressers are concerned. Pub owners are concerned. How can they increase their charges for services, food and beverage at the same rate as the increase in energy bills? No-one will pay that,” she said.

The energy crisis is the latest in a series of pressures weathered by businesses over the past few years, including: Brexit, COVID-19, and war in Europe.

“I am trying to stay as positive as possible,” Jerome said, but expressed her concern for how much independent practices can increase prices before patients might consider moving to a chain.

“I hope that patients value the time and expertise of their local independent optometrist and continue to support all of us,” she commented.

Stephanie Lipsey-Liu, Charles Lea Opticians, Nottingham

Optometrist director Stephanie Lipsey-Liu, took on Charles Lea Opticians in 2021 and explained that her practice has not seen an increase in energy costs, having secured a set rate on gas until 2024. 

“We also shopped around for our electricity and got a really good deal on that too earlier this year, so we’re hoping we won’t see much of an increase at all for the next few years luckily,” she said.

The practice has observed the effects on patients and the public, however, with Lipsey-Liu commenting: “The cost of living crisis is affecting so many people.”

“We have definitely seen a drop in sales in August, but that’s quite typical here so it will be interesting to see if it picks up in September,” she added.

Amongst the wider community, Lipsey-Liu explained that a few local cafés have started closing down, “I assume due to high running costs making their businesses no longer viable.”

Sifa Modina: Eyes on Broadway, Muswell Hill

Sifa and Karmelo Modina took on Eyes on Broadway in Muswell Hill, a 130-year-old practice formerly known as H R Breakspear, in 2018.

Sifa Modina, practice manager and lead dispensing optician, has seen the effects of cost pressures on the High Street, telling OT: “Unfortunately, the area we are in has such high rents and rates, and with the rising costs of energy, we constantly see closures of shops and restaurants on our High Street.”

“It is becoming increasingly difficult to maintain a small independent business,” she added.

Brexit has continued to have an effect on the costs and purchasing decisions of the business.

This financial situation is temporary, and like with any financial crash or crisis, this too shall pass

Modina shared that the practice has been “hit by all of the customs charges from our suppliers post-Brexit,” which has been an added cost. She continued: “We have to think carefully about our buying process. It is no longer worthwhile to just update stock small parts at a time. We have had to plan in a way to be able to place a big enough order each time to make paying the custom charges worthwhile.”

Eyes on Broadway has observed patient concerns around increased living costs translate into how they are choosing to spend their money.

“We have especially seen a rise in the number of people wanting to ‘hold off for another year,’” Modina explained. “We have also had an increase in the number of reglazes compared to a couple of years ago.”

Nicola Gatehouse, Ball & Gatehouse Opticians, Wirral

In June, Nicola Gatehouse, director of Ball & Gatehouse Opticians, told OT that gas and electricity prices for the practice had doubled. While the practice hadn’t put prices up, she observed: “The extra money has to come from somewhere.”

Reviewing the present situation, Gatehouse shared that it was a case of “so far so good,” as energy bills had remained “relatively stable and manageable,” and that sales were also up.

“With regards to other costs rising, we’ve had price rises from our lens manufacturers which we have, in part, passed on to the patients,” Gatehouse explained. “I’ve resisted putting our sight test fees up so far but I think that is coming.”

So far, the practice hasn’t seen an impact on patient purchasing habits or behaviours, Gatehouse said.

“Maybe because the winter hasn’t hit yet with the rising costs associated with that,” she suggested. “I think this is very early days though, and the impact won’t be seen until Christmas or the New Year.”

OT will continue to report on the cost of living and cost pressures faced by practices as the situation evolves. If you would like to share your experience, please get in touch with OT. 

The AOP is also encouraging members to take part in its latest Voice of Optometry Survey, which focuses on how the cost of living is affecting eye health, as well as NHS waiting times. The survey will be open until 21 September, read more here.

This article was first published before the UK’s Prime Minister, Liz Truss, introduced a new Energy Price Guarantee, and has since been updated to reflect this information.