BERN

The energy crisis could lead to a wave of bankruptcies among small- and medium-sized businesses (SMEs) in Switzerland, according to a survey by European payment services provider Sumup.

Sumup conducted the pan-European survey in Switzerland, Germany, France, the UK and Italy.

A total of 127 SMEs from Switzerland, including restaurants, bakeries, retailers and hairdressers, took part in the survey.

The companies are now responding with sometimes drastic measures to prevent business closures.

According to the survey, 47% of companies are saving on electricity and 44% are raising prices. But not all of them can raise prices as high as they want.

Some 28% of SMEs want to reduce labor costs, while 21% have reduced their profit margins.

Also, 19% are increasing weekly working hours.

"Today, bread at the bakery would have to cost 7 or 8 Swiss francs ($7.38 and $8.43) because of the electricity costs for ovens and refrigerators, but no one would buy that anymore," Roland Rupp, president of the Swiss SME Association, told newspaper 20 Minuten.

The average price for bread in Switzerland is around 5 Swiss francs.

"Many are closing quietly now and there will be many more closures," Rupp added.

According to the association president, this crisis is worse than the pandemic. "Back then, the state still helped us with loans, today it does nothing. Politics has completely failed," he said.

Rudolf Minsch, chief economist of Economiesuisse, a Swiss corporate union, told 20 Minuten: "I share the fears of SMEs."

According to Minsch, about 20% of the 35,000 companies in the Swiss market, have no hedge on energy prices from next January leaving them vulnerable to price volatility.