40% of SME businesses have closed due to the lockdown
Over the course of the past few weeks, UK200 Group, of which we are members, has been conducting research amongst small businesses across South East and the UK.
The results make for worrying reading with more than 40% of SMEs closed as a result of the lockdown and more than half of all SMEs businesses having furloughed staff.
There has been so much reported in the press about the financial impact of the lockdown due to Coronavirus. Whilst the government is doing much to support businesses and the economy, the reality is that not all businesses or jobs will be saved. Rishi Sunak has said this himself.
Our research really brings home the reality for many businesses. We are sharing some of the comments SMEs made to us in the research. So, in their own words, this is what it means to SMEs in South East:
- After nearly 2 weeks,
the bank has not called me back and even though I’ve gone back to them,
the response is they have my details but they are exceptionally busy and
will get back to me ASAP.
- We have contacted our bank for a loan (in March) but they have been too busy to get back to us.
- We know that some farm machinery dealers in other parts of the country have already been awarded Local authority grants as we retail machinery and parts, but we cannot get any answers from West Berkshire Council currently.
- We did not get the interruption loan as Lloyds said we had too much security available so got a commercial loan – not what we wanted!!
- I was employed until June 19 but am now self-employed so I not eligible for either the support schemes for the self-employed or the furlough scheme as an employee.
- As a small company only founded 3yrs ago, we will be hit hard in the months to come. We provide legal services on a consultancy basis, but as most law firms have had to dramatically reduce operation and in many cases furlough/make redundancies, our work has rapidly dried up. Our profits were due to fall in any event and are unpredictable as best. We are suffering simply due to the fact we have worked exceptionally hard & had two good years profit. It seems unjust that we receive little to no support, and in the medium to long term, it makes little sense for the economy for a small business such as ours to face closure.
- l run a B&B but because l pay council tax and not business rates l am not entitled to the grant.
- I am an owner/director with my wage topped up by dividends. Thus, no help from the government.
- We are a registered dog homing charity. We have had to suspend rehoming as it involves non-essential travel. Our charity shop has closed, and we are unable to continue our fundraising. We are surviving because our trustees are funding the shortfall, but this cannot continue for more than a few months. We have to pay remaining staff at the kennels, animal food and kennel maintenance, services etc. Also, vet fees of £10,000 a month.
- The Government has come up with some good ideas, but the detail is useless. Small firms are being penalised with no support available often as a result of a technicality. Home based businesses who pay domestic rates or small companies who rent premises do not meet the needs of the small business grant mismanaged by Councils.
Commenting on the survey and the specific examples from SMEs, a fellow member of UK200 Group said; “Hearing how some businesses are being affected is heart-breaking. Many of the SMEs we are talking to feel they have been forgotten. 31% of them are predicting their business will fail if the lockdown continues beyond the end of June. As yet we don’t know the likely impact of any ongoing measures once the lockdown is ‘eased’ but this will have a significant and long-lasting impact in the South East.
We have written to the Prime Minister, the Chancellor, Tim Loughton, MP for East Worthing and Shoreham and Sir Peter Bottomley, MP for Worthing West to ask them to prioritise support to Stay Focused; Protect the Economy and Save Jobs. We are committed to doing our bit to support our clients and all SMEs by raising issues with the government on their behalf and by collaborating with the government and others to achieve these goals.
