The Recession- the effect it has on (smaller) business

The effect that the recession is having on business is that it is producing less revenue as more people have become unemployed, while the rest of the population do not want to be spending in case of losing their job as well. Due to there being less revenue business's have to make cuts which can either involve firing employer or cutting their wages. Larger organisations such as Tesco's for example will attract their customers due to their prices being lower. The business's will have a smaller variety in products due suppliers charging more for those products or having the suppliers who supply the variety of products going bust. Pricing strategies will need to change in order to attract more customers. Acquiring loans from banks will be a lot tougher as there is a higher risk of failure for example due to the countries economic climate 75% of small business fail within their first year. Trade credit (which is when a business doesn't pay for their supplies straight away and pay it within a certain amount of days or weeks) are much lower due to the higher risk of companies not being able to pay their suppliers back.