Reputation Management and Cost of Living Crisis

Posted by admin at 5:49 PM on Apr 1, 2022


As business owners face pressure from shareholders and executive boards, as well as the huge rates of inflation we are all experiencing, there are some tough decisions to be made. Keeping a business profitable in the face of rising costs across the board means raising prices to the consumer or end user, or making cutbacks on staffing. The cost of living crisis compounds the difficulty of this decision as raising consumer prices can leave a business open to undercutting from competitors. The unfortunate fact is that poor staffing decisions can be made as a result, as we saw when P&O sacked 800 staff in March.

The actions of P&O and the method by which they delivered the news showed little empathy for their employees and made them very unpopular in the public eye. P&O didn't even follow the typical “fire and rehire” model, where a business sacks or makes employees redundant and then offers their jobs back on worse terms (lower pay, lower holiday allowance and longer hours or shift patterns).Instead, they suggested that the ex-employees join the agencies from which they were replacing staff, thereby removing any duty to provide rights enshrined in employment law which don't apply to agency workers.

P&O are facing a complete loss of reputation due to their actions, which have angered many people and had a negative effect on getting aid to Ukraine; perhaps an unintended consequence, but bad press nonetheless. It beggars belief that no-one thought these actions might be received badly and they are now faced with the difficult task of managing their reputation.

There are some factors that P&O have in their favour, not least the reliance on their vessels to import goods into the country. As a large company they can afford to offer cheap travel for holidaymakers feeling the pinch, who may decide that boycotting the company at the expense of a cheap holiday isn't worth it. They may have been banking on this when they decided to take the action they did.

Companies of this size may be able to weather a reputational storm, and survive the hit on share values in the short term, but smaller and medium size business have to be much more careful. It is doubly hard then, to make decisions about raising prices or laying off staff in these purse-string-tightening times.

It is possible to put a positive spin on decisions to raise prices if you can promote the angle of retaining employees and supporting struggling families as a payoff. Creating good press and a positive buzz before making cutbacks can also help balance the reputation books, as can making charitable donations, or empowering staff to volunteer in the local community or raise funds for a good cause.

We know that businesses are facing tough decisions and we are able to help you retain or restore your reputation online so you can avoid negative publicity. As many people get their information from the internet, and will turn to the web to search for a business it is vital that your online reputation is gleaming, and that any negative mentions are difficult to find. There are a number of techniques we can use to create or repair the digital face of your business so if you're faced with a tough decision and you're worried about a potential backlash, get in touch with us today.

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