MORE than one in four UK businesses – equivalent to 480,000 firms – are considering cutting costs to cater for the rising costs of raw materials, according to research commissioned by commercial insurer NIG.

Larger firms are being hit harder, with 46% of those with an annual turnover exceeding £20m actively looking to offset rising raw material costs by making reductions in other areas of the business.

Some 6% of businesses in the UK, equivalent to 109,000 firms, admit that the rising prices of raw materials means that they might not be adequately insured against theft given the extra, unaccounted costs to replace stock. The same number also admit that they might not be adequately insured against damage such as fire or flooding.