I had the honour of being interviewed by Faisal Islam, the BBC economics editor about Dr Zigs and how the interest rate rises announced today will affect us as a small business. A business focused on manufacturing environmentally friendly and ethical Bubble toys. A business focused on creating fun, laughter and joy - all whilst making a difference. Our key driver is sustainability, and a percentage of all our profits goes to our Bubbles Not Bombs project, working with refugees and those in need, both in the UK and around the world.
As every other business, we are reliant on cash flow, the lifeblood of trade. And as a business going through a period of growth, this cash flow becomes even more crucial. How we manage it, when we save it, when we borrow to increase it, and how well we sell, bringing money back in to then grow and repay the borrowing. And cash - like any other component or ingredient in our Dr Zigs Bubbles, has a cost. As interest rates go up, so does the cost of this cash. And, as our cost of borrowing goes up - we are facing a rise in the cost of our ingredients, AND at the same time, our customers’ cost of borrowing goes up - so we risk ending up in a tricky mess.
Article on the BBC News Website here: https://www.bbc.com/news/business-62408868
The reason interest rates are going up is to manage inflation. The increase in the cost of goods, of everything that we as consumers want to buy. But what is possibly different at this particular moment, is that the increase is hugely focused on two key areas - the cost of energy, and the cost of food. These are the building blocks of our needs - and hence the cost of living crisis. It is literally costing us a whole lot more simply to live.
Added to this challenging scenario we have a background of Brexit, also hugely affecting trade and the cost of goods. War, again, impacting trade, the cost of food and the cost of raw materials now needed in greater demand by the arms trade (the only ‘winners’ in this humanitarian disaster). And greater than all of this we have Climate Breakdown.
Somehow, through all this, us at Dr Zigs, as a small business, and purveyors of fun - must survive.
I am incredibly proud of us - we are an exciting company, manufacturing in Britain, creating a product that brings joy to so many - whilst really trying to make a difference in terms of the environment and social justice. Whilst the cost of living has been rising, we have been working hard to shave costs - and carbon - off our toys. Shrinking packaging, bringing in flat-packs, better, and more sustainable ingredients, whilst maintaining (or even increasing) the quality of our Bubbles, of our graphics, of our systems and even our social media.
I think the UK government, indeed, the world, needs companies like ours to succeed.
Whilst worrying, these times also bring a huge opportunity for change, and we will need this - brave and radical change. The oil and gas industry must be taxed further, and the obscene profits fed back to offset the cost of living. Brexit could be reversed. Net zero pushed by every company, government department and organisation.
Whilst we live in hope, that our politicians may be brave enough to do the right thing, and whilst at Dr Zigs we do our utmost to navigate it all - we are determined to continue to make the best FUN quality products we possibly can, and continue to really have a positive impact on the world around us.
With our Bubbles we can play together, we can make friends - whether we are children and adults. Our Bubbles bring laughter and joy. Our Bubbles are used for therapy within special needs settings, hospitals and care homes. They are used amongst people of all ages because of their hugely beneficial impact on mental health. Our Bubbles are used for mindfulness, as a time to switch off from the stresses and strains of the everyday world. Our Bubbles are all about FUN.
Who knows what the future holds for Dr Zigs - whatever happens, we are determined to pull through this cost of living crisis, and somehow navigate through so that we can continue to provide the best eco, ethical FUN that we possibly can.