Lots more talk on the rising cost of living this week. It was also something I also noticed directly in my weekly food shop too.

To be fair it has been a while since I have done a full regular weekly shop. With trailing Christmas rations, COVID restrictions, and to be honest January cake-related reasons, I seem to have relied more on my local corner store than my local supermarket recently… but this week, with things looking up, it was time to get back into the routine.

The rise in the cost of living is getting real

Now, I am sure it has been creeping up for a while unnoticed, but sometimes you get to make direct comparisons and it hits you in the face. My weekly shop seemed to be around 50% more than it used to be.

Now we all know there has been some inflation, but 50% is quite a lot more than the 5% annual headline figure in well, the headlines. This is something that food poverty campaigner Jack Monroe has been pointing out for a while, and someone who is now talking with ONS to enable this to be better reflected in the stats (good on her btw).

But, here it was direct evidence in my shopping basket.

Now food of course is something we cannot really manage without, the other item in this category is the energy we use to stay warm.

In hot water… or not

Over the last year, we have also seen the price of wholesale natural gas increase significantly. This is to the point that it has put a lot of energy businesses out of business.

As a result, it has resulted in millions of us moving suppliers, a consequence being many of us have also moved onto standard tariffs.

Now if you were on a fixed price tariff before, this has already resulted in your energy costs increasing… however, even the standard tariff does not expose you to the full market price as yet… it is smoothed with price caps to prevent this happening.

But, history will catch up with us. Eventually, these price increases will kick in. With the announcement of the next standard tariff price increase is due next month, it going will be live on our bills in April.

With such a large number of us on these standard tariffs, this will impact a lot of people, and looking at wholesale prices estimates I have been hearing is that we could see increases in our energy bills of over 50% each month.

Time to be prepared

By adding both of these two, non-discretionary, expense increases together, it all adds up to a serious assault on our cost of living. It is once, especially for those on tight budgets, that is going to be difficult to absorb and could be enough to push many people over into deficit. All of this could have a serious impact on arrears levels across the economy.

Back to Basics

With this in the background, I too am thinking about how I can reduce costs in advance. Be it changing where I shop, cooking more at home, and just buying less stuff, there is seemingly always an opportunity to economize.

However there is also a limit to this saving, and for those with debt and behind on payments, there will also be a priority to provide appropriate support and forbearance plans to help people through what can be a difficult time.

Is now the time?

Of course, we have been expecting an increase in the levels of arrears for a while now. It was something we were all very concerned about early in the COVID pandemic.

But, the levels never really materialized (undoubtedly helped by government support). With maybe a slight questioning feeling of, were we all a little overdramatic at the time… the fear of arrears seems to have gone away.

But, is it different this time around, and are we now so desensitized that we are not taking action when we need to? Maybe.

So it may be time to re-dust off the plans, invest to ensure there is adequate staffing capacity and processes to handle the volume.

… and finally

One last thought in all of this is the importance of good customer service.

Going back to my shopping example, I have been ordering online for a while now, and am pretty used to unpacking and repacking boxes to bring my shopping inside to pack away.

This week however I was late to getting outside, and not feeling much up to the task… it had been a long day.

Imagine my surprise when the driver had already repacked the boxes to just take inside… needless to say, I was pleased and grateful.

Linking this experience back to customers in financial difficulty and forbearance… a customer helped in difficult times can make a customer for life… just something for us to think about in times ahead.

Have a good week everyone.

Sometimes it is the little things you notice that provide interesting insights, and this week was no different.

The topic of conversation was perfectly normal… chatting about differences between markets over the pandemic… it is something I always find interesting and illuminating, understanding how things are different.

However, in many cases these days, these differences, are increasingly being flattened.

In the last 10-20 years we have gone on this massive journey of globalization. One that has undoubtedly generated massive economies of scale, but one that has also resulted in more standard processes and products.

However, in listening closely, despite this wave of standardization, there is also an undercurrent of localization too… and some businesses are clearly seeing increased value by having products customized for distinct communities.

Coffee time

All of this was further reinforced later the next day by a further knock on the door.

Now normally, this is often an Amazon delivery, who I swear seem to be waiting for a video conference call to start before deciding to ring the doorbell.

This time, however, it was different… a milkman, setting up locally and offering a new service, looking for customers.

Now given this was 11am, I had just made a coffee and was actually grumbling ‘there is no milk in the house’. Timing is often everything and I had been caught at the most perfect time… I was sold (and if he had been offering sticky buns or cake I probably would have bought some of those too).

But, as the discussion to sign me up ensued, he also mentioned that he had also had a good response from my neighbours too. It set me thinking this is another local service picking up customers against the mass market.

Now two data points don’t necessarily make a trend, but they do make a line, and that line was going up. Is this a potential competitive advantage that can be deployed?

Your friendly neighborhood…

This is of course certainly something that local businesses can use, relatively easily, to create differentiated services and gain market share.

And, this customisation doesn’t have to be limited to a geography, it could also be local to a community too.

If people are increasingly looking for tailored solutions amongst the froth of mass-market offerings, this could be the next new but old trend in the ‘post-pandemic’ world.

So how should big businesses react, and will they be able to create the same level of service as a local provider? With the increasing use of data, the volume of data that is now available, it is undoubtedly getting tantalisingly close.

Mass customization of consumer experiences, almost down to individual level is starting to be possible. And, as the degrees of freedom within the data increases so does the likelihood that your experience is unique to you.

However, despite the advances that have been made, most of my day-to-day conversations still seem to revolve around process efficiency and mass customisation…

So my thought this week is… maybe we also now need to think and use this data to build community in our processes too, a new lens which to overlap on process design. It could lead to better customer outcomes, retention and be the next source of competitive advantage…

Have a good week everyone.

After what seemed a quiet week the first week of January, everything has suddenly leapt into life. Business development, new proposals, and key deliverables all seemed to be battling for attention this week. It was a relief to get to Friday.

Of course outside of the ‘cozy’ world of financial services and collections (if it can be even called cozy), it was even worse.

Pressing questions such as when is a party a work event, or a work event actually a party (hint: they were all parties), and a clash of culture between those who like to see what they can get away with vs those who accurately follow the rules, actually became matters of state (well at least in the UK and Australia). Plenty of arguments in the media and on social media ensued.

Then, in other news, we also had volcanoes exploding, geopolitical tensions and the onward march of Omicron… and this was all this week.

Caveman dynamics

If this is all getting a little overwhelming, you are not alone. Sometimes I feel I have the distinct desire to go and hide under a rock somewhere… it must break out the latent caveman in me somehow!

The danger here is with such a volume of change, pressure at work and external factors we cannot control, it can be easy to get overwhelmed.

And, with the pandemic timer now at over two years, are we running out of steam?

It certainly feels as if there is something going on here. This week alone I had three instances of people with open job positions looking for recommendations of good people, and four or five notifications of job moves. It is not exactly the great resignation, but certainly all change.

So what is going on? Are we all bored? Is it a search for certainty? Or is it a micro-indicator of work burn-out that is building

I am not sure, time will tell, but what I am sure of is that the one thing we cannot get more of is time. Time has ticked on throughout the lock-downs and is seems in some areas, sometimes, not much as happened. It has flown by and maybe a little too quickly with not much to show for it… other than the numbers on the birthday cards getting bigger.

Slowing down time

So how do we create more time… we need to slow down time, well at least the perception of it. The best way I have found to do this?… do more, new stuff.

An experiment along these lines in 2017 yielded interesting results. Activities included learning new skills, activity-based weekends, and a mad dash to the US to watch the solar eclipse one weekend. It showed it can be done and the year really did feel longer (albeit I was exhausted)… and what was the key, experiences must include something new, and not so routine… yes you need the routine day to day, but discover some new things too.

So maybe this is also a goal for this year… try out some new things again, learn new skills and discover new places.

If nothing else it could be a welcome distraction from everything else going on! [Ideas and suggestions welcome, please post in comments below}

Other stories this week

Will remote work stick after the pandemic?

Ovo expected to make a quarter of staff redundant due to energy crisis

British Gas owner Centrica warns high energy bills to last two years

6m UK homes may be unable to pay energy bills after price hike, charity warns

UK bank branch numbers have almost halved since 2015, analysis finds

Remote work is becoming permanent — for a sliver of the workforce