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Sellers on social commerce platforms such as Vinted and AirBnB are warning of a new scam in which AI-created images are being used to leverage refunds.

The rising trend is a worrying one for ecommerce business owners who could face not only the cost of refunds for items that aren’t actually damaged, but are also likely to not get the allegedly damaged stock back.

The reports come at a time when ecommerce firms are scrambling to protect their website traffic from AI-powered search, which is causing dramatic drop-offs for many businesses.

Fake images for fake claims

The Times is among those documenting this latest AI scam trend. It quotes experts arguing that items must be returned to prove the damage as AI can easily be used to produce fake images. Amazon sellers are also reporting a rise in these claims; and are urging caution.

However, reports suggest that this issue is being felt beyond ecommerce. In August, The Guardian reported on a case in which an AirBnB owner falsely accused a customer of damage to their property, and used AI-generated images as evidence.

The customer – a London-based academic – had booked a two-and-a-half month stay in the apartment in Manhattan but left early because she felt unsafe. She was then hit with a slew of charges after the AirBnB host accused her of a litany of damages, including splitting a wooden coffee table; and staining a mattress with urine.

The customer refuted all claims but AirBnB initially told her to reimburse the host a total of £5,314. She then fought the decision, has now been refunded and the rental company has promised an internal review.

Fake images for fake products

There is also rising dissatisfaction that AI is also being used to either change products to give a false impression of quality or to turn them into something else entirely.

Science Feedback reported on finding products on Vinted that are claimed to be vintage but are actually, in reality, from fast-fashion brands including Shein and Temu.

The article describes the images as “highly aestheticised”, lending the clothes an appearance of “high quality” that, in reality, they simply won’t have. The researchers even found corresponding products on the Chinese ecommerce websites and noted that they were being listed for twice the price – if not more – on Vinted.

This is a sinister twist on the dropshipping model; and the article adds that there are even websites that can help scammers make clothes “look worn” with AI technology; but obviously not too worn to sell.

To counter this issue, customers are urged to do a reverse image search to see if the item is, in fact, vintage or fresh out of a Chinese factory.

AI for streamlined sales

As with all technology, businesses will have to take the bad with the good. AI is being deployed to spot defects in products before they are sent out by Amazon; but is also helping businesses streamline their logistics and speed up their interactions with customers.

Virtual influencers and AI-generated models (created with the consent of real models) can allow fashion businesses to produce thousands of images for far lower outlays to get more products online.

The key seems to be transparency. Customers need to know if an image has been AI-generated or manipulated in order to make a purchase in faith.

Scammers may be using AI to dupe; but businesses can use AI to enhance the customer experience. As with all technology, the key is honesty and trust.

The post AI reviews are the latest threat to online sellers appeared first on Startups.co.uk.

HM Treasury has launched an investigation into the impact on Small Business Rate Relief (SBRR) when a company opts to buy a second site.

HM Treasury published a report last week revealing the Chancellor will explore fixing the sudden jumps in business rates that appear when a firm expands. Known as “cliff edges”, these can discourage small business investment and growth.

Chancellor of the Exchequer, Rachel Reeves, said: “Our economy isn’t broken, but it does feel stuck. That’s why growth is our number one mission. We want to see thriving high streets and small businesses investing in their future, not held back by outdated rules”.

Stunting growth

SBRR is a national discount scheme administered by local councils on behalf of the UK government. In England, you can get SBRR if your property has a rateable value of £15,000 or less.

However, as outlined in the Treasury’s report, firms currently lose SBRR the moment they add another property, which can turn a modest move into a costly leap.

As The Treasury writes: “That means that a local bakery would have to pay thousands of pounds more for opening a small shop in the next village.”

Kate Nicholls, Chair of UKHospitality, agreed, pointing out that this system has been “…unfairly punish[ing] hospitality businesses”.

She added: “These measures to remove punitive cliff-edges and barriers to investment are positive and will help to rebalance the system, as will the government’s commitment to lower business rates bills for hospitality businesses.”

The report suggests change could be imminent but there is a caveat that this is an “exploration” and we are unlikely to see confirmation of changes until the Autumn Budget.

“A rare moment of common sense”

The report has been received positively by business owners and organisations alike.

Eamonn Prendergast, chartered financial adviser at Bromley-based Palantir Financial Planning Ltd said that the current system is no less than a “tax trapdoor” for business, “one step too far and small firms are hit with bills they can’t sustain”.

He stated: “Smoothing these jumps would give local shops, cafés, and start-ups the confidence to grow without fearing financial freefall.”

There are, however, views that the Government needs to do more, not least among hospitality business owners who have been hit hard by changes to employer National Insurance contributions.

As Samuel Mather-Holgate, independent financial adviser at Swindon-based Mather and Murray Financial, said: “Although business rates are in need of a restructure, most businesses are pleading with the Chancellor to look again at employers’ National Insurance as it’s this that is killing off growth for businesses desperate to expand.”

Others pointed to the current Corporation Tax rates and the introduction of the Employment Rights Bill as contentious with businesses.

It will be the unveiling of the Autumn Budget that will give SMEs a clear view of the future. It looks like positive changes will be on the cards; but as Tina McKenzie, FSB Policy Chair, said: “…the proof will be in the pudding at Budget.”

The post Law change could slash costs for high street expansions appeared first on Startups.co.uk.

The Secretary of State for Business and Trade, and President of the Board of Trade is now Peter Kyle. He takes over the role from Jonathan Reynolds, who has become the chief whip.

A member of parliament (MP) since 2015, Kyle comes into the role as firms reel from the employer National Insurance contributions (NICs) hike as well as mounting costs.

He will be watched intently by SMEs to see how he treads the line between fiscal discipline and creating an environment in which businesses can thrive.

Kyle takes the role just months before the Autumn Budget is announced and predictions of more bad news for SMEs are already mounting.

There are, however, suggestions that relief may be provided in the form of energy subsidies, business rate reforms and support for businesses trying to move towards digital technology – something Kyle asked the last Government about in Parliament.

Who is Peter Kyle?

Kyle is the MP for Hove and Portslade, where he has been elected three times and has lived for 25 years. From July last year, he also held the role of Secretary of State for Science, Innovation and Technology.

The 55-year-old political veteran studied geography, international development and environmental studies at University of Sussex.

After gaining a PhD, Kyle was deputy chief executive of ACEVO, which is the Association of Chief Executives of Voluntary Organisations, and whose trustees include Mark Norbury, chief executive of UnLtd, the UK’s leading foundation for social entrepreneurs.

He then moved on to heading up the charity, Working for Youth, which is aimed at tackling youth unemployment. Kyle is also the first openly gay MP for Hove and Portslade.

What will Kyle do for small businesses?

Kyle has toed the party line when it has come to fiscal decisions. He appears to have been pro the National Insurance rise for employers, which has been controversial among business owners and economists alike.

Kyle also voted to raise Capital Gains Tax (CGT) for business owners and to make Investors’ Relief less generous.

However, Kyle did also vote to give special discounts to draught beer and cider under 8.5% to help pubs and small breweries, as hospitality firms claim they are being “taxed out”.

So, can we expect more of the same then? With his voting record, it is unlikely that Kyle will push to roll back the NICs changes; nor will he likely block tax rises over borrowing.

Technology champion

However, what we are likely to see is Kyle championing measures to help businesses upgrade their technology. He is a vocal advocate of AI – and hit the headlines for using ChatGPT to help him brainstorm in his previous role.

In July, in a speech at CityWeek 2025, Kyle stated: “An economy that, like ours, knows that the key to staying competitive is being squarely focussed on the future.”

He added: “…talking about the power of AI to grow the economy is all well and good. But unless companies use it, that growth only exists in theory.”

Kyle will likely push for measures to allow SMEs to upgrade their technology and upskill their staff; but in the beefy matters of NICs and potential tax increases, he will vote with his pack.

The post Who is Peter Kyle, the new business secretary? appeared first on Startups.co.uk.

While many shoppers rely on the opinions of fellow consumers before hitting ‘buy’, government data indicates that around a third of customer reviews on major platforms could be fake. And, as one CEO has learned, these fake reviews can cause real harm.

In addition to being useless in guiding shoppers, fake reviews may lead to significant reputational damage for small businesses. Adam Collins, CEO of Ignite SEO, found that out the hard way when his agency was targeted with one-star reviews by spammers.

With the new Digital Markets, Competition and Consumers (DMCC) Bill coming in this year, fake reviewer posters may be stopped in their tracks. Under the new law, the Competition and Markets Authority (CMA) has greater powers to clamp down on fake reviews.

Why fake reviews are a growing threat

For many of us, customer reviews are a significant factor in decision-making when we’re choosing where to shop online. Research from the Department for Business & Trade states that they influence a huge £23bn of UK consumer spending annually.

And while reviews might exist online, it’s also brick-and-mortar businesses that are affected by ratings. It’s become almost second nature for customers to check out Google Business profiles or social media posts surrounding restaurants, pubs, and hotels before booking.

But, while major retailers may be able to absorb the blow of a few lower ratings, for SMEs, this can tank their rankings. A one-star review can skew an average overall rating, which can scare off potential customers and cause lasting damage to both reputation and profits.

Of course, not all fake reviews are negative. Some businesses may also inflate their own ratings with artificial praise to drown out criticism, as investigated by Which?. Either way, the issue seems to be rampant and causing trouble for both businesses and consumers alike.

How to spot a fake review

Fake reviews don’t always appear gradually. Sometimes, they arrive as part of a concentrated effort designed.

Adam Collins said he woke up to “a string of one-star reviews” and spam messages on WhatsApp, in what he called “a coordinated attempt to shake trust.”

For business owners like Collins, the key to stopping fake reviews is first recognising them. “If someone vandalised your storefront, you’d clean it up quickly”, points out Collins.

“Online reputations deserve the same care. The good news is the law is catching up, but SMEs need to stay alert and proactive.”

If you notice a sudden spike in reviews that doesn’t align with your actual sales or bookings, that could be a red flag. Generic or vague complaints, suspicious reviewer profiles, and clusters of posts arriving outside normal business hours are also common warning signs.

These signals can easily be mistaken for genuine customer dissatisfaction, but often they have little to do with your real business performance. By recognising this, SMEs can avoid wasting valuable time and energy chasing the wrong issues.

What small businesses can do about it

If you find yourself on the receiving end of fake reviews, don’t panic. Respond calmly, flag and report suspicious posts on the relevant platforms, and encourage genuine customers to share their feedback to counteract the negativity.

It’s also wise to train staff early on. Team members managing social media, customer care, or review platforms are often the first to spot suspicious activity, so equipping them with the right awareness means your business can respond more effectively.

As Collins warns: “For small businesses, even a handful of fake reviews can damage rankings, scare off new clients, and create real financial loss.”

The post Business owner warns of “overnight attacks” by spam reviewers appeared first on Startups.co.uk.

Next month, ecommerce businesses that send packages through a Royal Mail business account could be charged up to £1.40 more to send parcels, after the postage service announced its latest price rises last week.

Costs will rise for customers sending personal items or selling on marketplaces like eBay. But deliveries will also become more expensive for business account holders, which will have a knock-on effect for online shops.

Below, we’ll explore how the planned price increases will affect firms specifically using the tracked Royal Mail 24® and Royal Mail 48® services. Here’s what’s changing.

What’s changing in Royal Mail’s 2025 price update?

Royal Mail regularly ups its prices as the cost of delivering items creeps upwards, with the most recent major increases occurring in April 2025. 

From Monday 6th October, costs across the organisation’s portfolio will increase by varying amounts. Notably, the compensation amount for consumer tracked services will be reduced from £150 to £75.

There will also be big price hikes when sending parcels with Royal Mail 24®, a business service from Royal Mail that aims for next-working-day delivery.

Compared to August 2025 prices, firms will pay 40p more to send small parcels weighing 1kg or less through Royal Mail 24® from October 6th. The heaviest parcels weighing 20kg will cost up to £1.40 more per item.

Costs for Royal Mail 48® (which aims to deliver parcels within two working days) have also gone up slightly, though not by as much as the quicker service.

As well, there will be a peak surcharge introduced for business accounts sending items over the Christmas period. This applies to domestic parcels and international products from 17 November 2025 until 9 January 2026.

What does this mean for ecommerce sellers?

For many ecommerce businesses, the latest Royal Mail price increases will put further pressure on already tight profit margins. 

Firms using Royal Mail Tracked 24® / Tracked 48® must sell at least 1,000 items a year to qualify for the services. That means account holders sending the smallest, 1kg parcels will spend an extra £400 a year at least from October 6th.

Sellers that offer free shipping as an incentive to customers may find themselves absorbing more of these costs, cutting into profits even further. 

How can small sellers adapt to higher delivery costs?

Reviewing shipping policies, such as free shipping thresholds or minimum spend requirements, can help manage additional expenses without alienating your customers. 

It doesn’t hurt to compare Royal Mail rates with other courier services or use aggregator platforms, as you may find a cheaper alternative. 

Even just making small adjustments to your packaging can reduce costs over time, such as using lighter materials or optimising parcel dimensions.

Looking ahead, delivery costs are likely to continue evolving. By planning ahead, especially for the Peak Surcharge period, you can be better positioned to protect your profit margin and stay competitive during the busy holiday season.

The post Royal Mail to raise business parcel prices next month appeared first on Startups.co.uk.

The Autumn Budget 2025 is officially set for Wednesday, November 26th, and SMEs across the country are anxiously waiting to find out what will be announced.

Last year’s Budget was a particularly bad one for small businesses with the announcement of a rise in employer National Insurance Contributions and a drop in business rates relief for retail, leisure, and hospitality. Sadly, this year’s statement could be similarly sour.

It will mark the end to a difficult year for SMEs, who have had high inflation, hiked taxes, and digital transitions to contend with. In July, the government’s Small Business Plan provided some hope in the form of further funding and powers to tackle late payments.

Aman Parmar, Head of Marketing at SME flexible workspace provider BizSpace, praised the plan, but added “without targeted tax relief measures – such as enhanced capital allowances – SMEs may struggle to invest in growth.”

What will happen on Autumn Budget day?

The Autumn Budget is an annual event where the Chancellor, Rachel Reeves, will outline the UK government’s plans for public spending, taxation, and economic policy.

Traditionally, the Budget is delivered in the House of Commons and lasts around an hour, usually following Prime Minister’s Questions (PMQs).

You can tune into the Budget live on the BBC Parliament channel, as well as online via the UK Government’s official channels.

Ahead of the announcement, experts are speculating that the Chancellor will choose tax rises over borrowing. After her proposed welfare bill cuts were watered down in July, she will need to raise about £20bn.

Possible measures under consideration include a new National Insurance charge for landlords, changes to inheritance tax, and adjustments to the VAT threshold, though the specifics remain uncertain.

What’s likely on the table for SMEs?

SMEs are anticipating some level of financial relief to be announced in the Autumn Budget. Possible measures might include investment in infrastructure, funding for digital transformation, energy cost relief, and much-awaited business rates reforms.

Regarding business rates, Labour has previously pledged to permanently lower tax rates for retail, hospitality, and leisure (RHL) properties with rateable values below £500,000 in 2026.

Parmar argues that the current business rates system is “outdated and disproportionately burdensome, especially for retailers and hospitality businesses still struggling post-pandemic.

“If Reeves can align her proposals with a reform of business rates that eases this burden, it would demonstrate a significant commitment to supporting the SME sector”, he adds.

Other circulating possibilities include a rise in the National Minimum Wage, anticipated changes under the Employment Rights Bill, and a potential increase in Capital Gains Tax.

What do small businesses want?

Many UK founders are calling for a rollback of the recent hikes in employer National Insurance contributions (NICs) and a commitment not to raise taxes further.

Tony Redondo, Founder at Newquay-based Cosmos Currency Exchange, echoed this sentiment, saying that the Chancellor should, “Recognise the economy is on its knees and don’t bury it completely with yet more tax rises.

“We need to promote economic growth, which means encouraging businesses, not tying them up in ever more taxes and red tape.”

Industry groups such as UKHospitality have compiled a similar list of requests. It includes urgent reform to business rates and employer NIC rates, as well as a lower rate for VAT for the industry, as already demonstrated by many EU countries.

However, a ban on tax rises is unlikely given the current economic pressure. While calls for relief are warranted, with the government under strong pressure to increase revenues, SME owners who expect a generous Budget will no-doubt be disappointed.

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