A recent study conducted by FreeAgent has highlighted that UK SMEs are far more resilient than might have been expected but holes in the government’s support have emerged, according to speakers at a roundtable event last week.
“Employment has been saved by the furlough scheme that has been made available – support was incredible, but too many people didn’t access it,” said Andrew Chamberlain, director of policy at IPSE. “But the self-employed are fragile and need support. We need to be coming out with a new system that is fair.”
The research, carried out on 500 UK small business owners in October, revealed that 32 percent of SMEs said they were negatively impacted by the pandemic – showing that two-thirds still remained resilient during the crisis.
Sonali Parekh, policy director at the Federation of Small Businesses (FSB), according to small businesses have had to rapidly adapt by changing their business models, particularly as many have had to strengthen their online presence.
“We are concerned about businesses that are falling in that gap and the suppliers of these businesses. The CBILS and Bounce Back scheme were crucial for businesses to survive in the first wave, but what about those that don’t have access to it,” said Parekh.
She wasn’t alone in her call for further support.
“We are prolonging the agony by not supporting businesses properly,” added Lisa Rix, head of customer engagement at NatWest.
Bernadette Stevenson, a restaurant owner, says booking cancellations started Mid-March, but the business continued to tumble from then on as it failed to meet the eligibility criteria required for government support.
“We were getting busy; we were building up a good customer base. Mother’s Day was coming up in March. We’re fully booked all weekend and then by Mid-March we had cancellations. During the lockdown, I wasn’t eligible for any of the funding because I don’t pay business rates and we didn’t have a lot of money in the bank,” she said.
In the research led by FreeAgent, UK SMEs showed little positivity about leaving the EU, with a 30 percent decrease in the number of companies looking to trade within European countries in the EU.
The accumulative burden of regulations imposed on small businesses must also be considered by the UK government, according to Parekh, as these will add significant challenges on those looking to recover amid the crisis.
Resources & Whitepapers
As a business owner, Stevenson says complying with regulations is significantly time-consuming.
“I do everything on myself. You don’t have time to look at the regulations, at the books. It’s another burden we don’t have time to deal with. I have a great accountant otherwise I wouldn’t be able to survive,” she said.
The uncertainty caused by Brexit combined with regulatory requirements will make it difficult for businesses to recover during this period, according to Chamberlain.
Leave a Reply