GFSB urges action to mitigate impact of power cuts on businesses

Power cuts have immediate and direct financial consequences for small business owners, the Gibraltar Federation for Small Businesses said on Tuesday, as it underscored the impact these were having on various sectors.

The Rock once again experienced a Gibraltar-wide blackout on Monday morning after damage was caused to cables on the ex-MOD network by a contractor, with the power cut lasting for nearly two hours.

Following the event the GFSB issued a statement and said its members have expressed concern about the ongoing issue of regular power cuts, which are having a significant impact on their operations, costs of doing business and profitability.

“Power outages have become an all-too-common occurrence, with many businesses experiencing frequent disruptions to their power supply,” a spokesman for the GFSB said. “Power cuts such as todays can result in lost productivity, damaged equipment, and reduced customer satisfaction, all of which are impacting the bottom line of local businesses.”

“The situation is particularly concerning for small businesses, who do not have the resources to invest in backup power solutions or absorb the costs associated with lost revenue and
equipment damage.”

The GFSB shared testimonies from members who run businesses in various sectors in Gibraltar.

“We rely heavily on the shop having power to accommodate our upwards of 20 clients per day,” a hairdresser said.

“With the most recent outage we had to send four clients away with wet hair, which also costs us around £300 in lost revenue”.

Another in the retail sector said: “These sudden power cuts are happening too often and without warning.”

“[On Monday] morning Main Street was full of tourists just off two cruise liners in port.” “Some asked if this is a regular occurrence in Gib, while others were hesitant to enter a dark shop.”

“My shop lost business to card paying customers as the broadband system was down.”

“I’m sure many other shops have lost business too.”

“I have another shop where we have 4G card machines, so at least those customers could pay by card.”

“I will now equip all our shops with 4G card terminals but this is an added unnecessary expense.”

There was concern about the impact the power cuts would have on food being prepared in restaurants.

“On top loss of direct sales because we can’t finish, serve or sell out product, we suffer losses from having to dispose of half cooked food in our ovens,” a member from the catering sector said.

“Our equipment also regularly suffers damage from power cuts - today it was the fire alarm system that got damaged when power eventually returned.”

“We will need to spend money to fix it.”

“At a time when the cost of produce and overheads are going up at a rate we simply can’t absorb or plan for, the continuing power cuts just rub salt in the wound.”

For a business that is run online, a power outage is “causing a variety of problems”, from loss of productivity to lost revenue.

The business coming to a standstill “not only causes missed deadlines, unhappy customers and lost revenue, but also damages our reputation with customers who depend on us”, an online business owner said.

“Even after power is restored, the disruption caused by outages can lead to a loss of productivity, low morale, and employee frustration,” the business added.

“It is very hard to plan for and mitigate the effects of power outages, and the cost to invest in backup generators or uninterruptible power supplies (UPS) is too prohibitive for small businesses.”

“I understand that power outages are a complex issue, but I believe that more can be done to mitigate their effects on small businesses like mine.”

Meanwhile a business in the distribution sector lamented the delays to its service caused by the power outages.