One in five small firms fear second lockdown could be fatal
By Rob Freeman | 16th October 2020
Almost one in five SMEs do not think they would be forced to stop trading if another lockdown was introduced, according to a new report.
Insurer Simply Business found 17 per cent of surveyed businesses believed they would not survive another lockdown with 32 per cent thinking they would survive but be hit harder than by the first wave of restrictions.
A further 34 per cent feel a second lockdown would have the same impact as the first with just five per cent thinking they would cope better second time round.
And 24 per cent of businesses think it will take 12-18 months to recover money lost - 19 per cent putting the figure at six to 12 months and 12 per cent saying 18-24 months, although 12 per cent think it could take two to three years.
The report found 24 per cent of small businesses believe it will take six-12 months for customer numbers to return to normal with 14 per cent thinking it could be more than a year.
Encouragingly, 68 per cent of small business owners expect employee numbers to remain the same, but 21per cent expect it to decrease.
The study also showed 62 per cent of SME owners feel less confident about the long-term prospects of their business but 43 per cent said they are comfortable adhering to government guidelines and a further 30 per cent are very comfortable.
Despite the overall challenges, there are positives to come out of lockdown with a quarter of SME owners saying staff have learned new skills, 21 per cent have found new customers and 19 per cent adopted new technologies.
And 17 per cent have expanded to offer more products or services with 42 per cent of SME owners saying they are more reliant on technology because of coronavirus.
Simply Business chief executive Alan Thomas said: "The nationwide lockdown has had a significant effect on all businesses - from the very largest to the smallest.
"Few have been financially harder hit than SMEs, small businesses and the self-employed, it's telling that many live in fear of another lockdown and the consequences it would have on their business.
"It's promising to see the level of resilience and innovation in the small business community - the greater adoption of technology, and learning of new skills is a real positive and bodes well for the future."
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