The impact of the war in Iran on West Midlands businesses
Between Monday 14 April and Friday 1 May 2026, the Greater Birmingham, Coventry and Warwickshire and Black Country Chambers of Commerce shared a British Chambers of Commerce survey seeking to understand the full extent of how the conflict in Iran (alongside domestic policy changes) is impacting businesses.
The following provides an analysis of the 122 responses received from organisations based in the West Midlands Combined Authority (WMCA) area, including direct quotes from local businesses responding to the survey.
These businesses represent a range of business sizes and sectors, including manufacturing and production (23 per cent), hospitality, catering and tourism (11 per cent), retail and wholesale (7 per cent), and admin, support and consulting (11 per cent).
Impact
Businesses across the WMCA area reported a range of direct impacts associated with the ongoing conflict in Iran. 49 per cent indicated their operations have already been affected by the conflict, while 26 per cent anticipate future impacts. Only 21 per cent expect no direct effects, and a small number remain unsure.
The most common challenges cited were increased fuel costs and rising prices from suppliers, both of which featured prominently in survey responses. The situation has also resulted in surcharges on freight and materials, and delays in customer deliveries. Manufacturing and production firms reported loss of sales to the Middle East, higher costs for raw materials such as copper and chlorine, and difficulties with shipping and supply chain communication.
“[We are experiencing] fuel surcharges on seas freight containers and UK haulage [and] material cost increases in the Far East and India” – SME retail or wholesale business in Coventry and Warwickshire.
“Materials are going up more than expected, delivery charges [are] up both into us and our deliveries to customers.” – Micro manufacturing or production business in the Black Country.
“Chlorine prices have increased and there are talks of chlorine shortages, we are a swimming company and this would have a deeply negative effect if we have to close our pools. Petrol increases have significantly impacted how much it costs us to move our portable pools from site to site.” - SME services firm in the Black Country.
Hospitality and tourism businesses highlighted declines in visitor numbers and loss of profitability stemming from travel uncertainty and flight re-routing.
“We work with long haul flights and holidays, war has left clients in an unsure situation, where they do not want to travel at the minute because of uncertainty. Repatriation admin costs are borne by the company, refunds are processed, so there is a loss of profits as well.” - Micro hospitality business in Coventry and Warwickshire.
“[We are seeing an impact on] prices of raw food (fish especially) and increases in costs from suppliers e.g. fuel surcharge on waste removal services.” - Micro hospitality business in Greater Birmingham.
Consulting firms and other service-based organisations described cancelling or postponing overseas training courses, interruptions to ongoing projects, and increasing difficulty completing business transactions. Respondents also noted wider supply chain impacts, with higher costs and delays affecting both their own operations and those of their customers, contributing to disruption across multiple sectors.
“[We are seeing] increasing cyber threats” - SME IT, data analysis, web or data services business in Greater Birmingham.
“[We are seeing an impact on] consulting and academic work [and] less students visiting the UK to conduct an MBA” – Micro marketing, advertising, or communications business in Coventry and Warwickshire.
Looking forward, a majority of organisations expect their energy bills to increase in the next year: 43 per cent anticipate rises of 20–100 per cent, 28 per cent expect increases of less than 20 per cent, and only 10 per cent foresee no change. When considering their ability to pay these bills, 32 per cent said it will be fairly easy, whilst 30 per cent expect it to be fairly difficult and 6 per cent very difficult, however no businesses expressed expectations they will be unable to pay them. As a result of rising energy prices, some organisations reported knock-on operational and cost impacts. Retail businesses in particular highlighted pressures linked to higher operating and supply costs.
“Lack of foot flow due to finances”- Retail or wholesale sole trader in the black country.
When considering government regulatory changes, 21 per cent of organisations said closer alignment with EU rules would significantly help their business to trade and grow, and 24 per cent believed it would somewhat help. Conversely, 7 per cent thought it would somewhat hinder their organisation and 3 per cent saw significant drawbacks, with a quarter remaining unsure.
Support Required
When asked about urgent support needs, businesses consistently pointed to the need for relief from rising fuel, energy, and transport costs. Respondents from a range of sectors called for measures such as energy or fuel subsidies, VAT reductions, reviews of fuel duty, and more affordable transport options, reflecting widespread concerns about cost pressures. Some organisations also called for business rates reductions as a means to help offset wider increases in operating costs.
“Government could assist with fuel duty” - SME manufacturing or production business in Greater Birmingham.
Alongside these calls for financial relief, several organisations emphasised the importance of clear, timely information and updates to help them manage uncertainty.
“Being kept abreast of any updates is important to us.” - SME manufacturing or production business in the Black Country.
A small number of respondents felt that external support would have limited impact, citing factors such as projects already delayed or decisions being managed by parent organisations based overseas, which reduced the scope for domestic policy interventions to influence outcomes.
“Support is unlikely to help as the loss of dialogue has delayed projects significantly.” – SME manufacturing or production business in Greater Birmingham.
Paige Bowyer
Policy and research analyst
Greater Birmingham Chambers of Commerce
