Business Round-Up – 11 May 202011/05/2020
Chamber Network Calls On HM Treasury To Extend Furlough Scheme11/05/2020
Businesses in Inverclyde are facing a catastrophic decline in cashflow due to the impact of the Covid-19 pandemic and are coming up against barriers in government support, a new survey has found.
A snap survey of companies in Inverclyde undertaken by Inverclyde Chamber of Commerce (ICC) has found that without access to support, 46% of these companies expect they will run out of cash in three months’ time, which is how long stringent measures to mitigate the spread of the virus are expected to be in place.
Over three-fifths (63%) who responded believe that there are gaps in the current business support measures offered by the Government.
The ICC survey, which was conducted from 14 April to 24 April, formed part of 351 responses gathered by the Scottish Chambers of Commerce Network in the same period and was the third-highest local authority area represented, highlighting the concern for local businesses currently.
Thirty percent of the respondents work within the services sector with 43% of the respondents working in the retail, hospitality, or tourism sector. Ninety-eight percent of Inverclyde respondents are SMEs (firms with fewer than 250 employees).
Cashflow: 46% of companies in Inverclyde say current cashflow levels will only cover them for a period of up to or less than 3 months.
Barriers to support: Over three-fifths (63%) believe that there are gaps in the current business support measures offered by the Government.
High uptake on small business support grants: Nearly (46%) of firms have used or intend to use the £10k small business support grant.
High uptake on the Job Retention Scheme: Half of all firms are using – or intend to use – the furlough scheme.
Commenting on the results, Gavin McDonagh, President of Inverclyde Chamber of Commerce said:
“Both the UK and Scottish Government have moved quickly to staunch this catastrophic decline but what businesses are saying is it’s still not enough.
“If we are to prevent the Scottish economy from being damaged beyond recognition, our local businesses need cash in the bank now to be fit for when the country is able to start returning to day to day activities.
“Businesses are also looking for an economic recovery plan in Scotland that avoids a restart-stop scenario. We need clarity so we can plan ahead while still protecting the health of people across Scotland.
“Many are also concerned that Scotland’s recovery schedule doesn’t lag too far behind that in England, with the potential of creating a competitive disadvantage in Scotland.
“As we begin to look towards what the economic recovery phase will look like and what it will mean for businesses and jobs across the country, we must always remember the economy is about the people within it who will power us out of this crisis.
“Inverclyde businesses are playing their part in saving lives and protecting the NHS, but we must also secure the economic future of both Inverclyde and our country and the livelihoods of those who work within it.’’
The latest poll has been released by Inverclyde Chamber of Commerce and all local and national businesses are invited to complete this short two-minute survey:
46% of Inverclyde companies are telling us that their current cashflow levels will only cover them for a period of 1-3 months.
17% are reporting that they have cash reserves for 3-6 months.
8% are reporting that they have no cash reserves left.
SIZE OF RESPONDENTS:
96% of the responses are SMEs with workforces of less than 250 employees.
Out of these, the highest trend was of companies with 1 to 9 employees which made up 42% of responses.
25% was made up of sole trader businesses.
HOW MANY EMPLOYEES ARE THESE BUSINESSES FURLOUGHING?
Nearly half (46%) of responses intend to furlough at least half of their staff or more, with 17% of these intending to furlough all of their staff.
FEEDBACK ON GOVERNMENT SUPPORT:
0% of responses are currently attempting to use the CBILS, 4% plan to use it, 87% are not currently using it but know of it
25% of responses are using the Job Retention Scheme, 25% plan to use it, 42% are not using it now but know of it
46% of responses either are using the small business grant of 10k or plan to use it, 27% know of it but are not using it
30% of responses are either using or plan to use Updated HMRC Time to Pay, 38% know of it but are not using it, 13% have attempted to use it but have not been successful in acquiring it
GAPS IN GOVERNMENT SUPPORT:
Over three-fifths (63%) believe that there are gaps in the current business support measures offered by the Government, 29% are not sure and 8% do not believe there are any gaps.
Notable concerns were the accessibility and responsiveness of support, a lack of support for home-based businesses and a lack of business support for director owned small companies or those more recently self-employed