Originally written by Anna Jordan on Small Business
Bristol Council warns that the government hasn’t given them enough grant funding to help small businesses to survive lockdown, according to the Financial Times.
In early May, the government offered £617m for businesses that missed out on the earlier business rates grants scheme. These grants will be distributed to businesses that operate in shared workspaces, market traders, charity shops and bed and breakfasts.
The funding doesn’t stretch far enough for all of those who are eligible, leaving it for the councils to decide who should benefit. A number of tech companies and boutiques operate from shared spaces where business rates are often incorporated into the rent.
Craig Cheney, deputy mayor of Bristol, says that the city had at least 1,700 businesses in shared spaces but only £3.5m to allocate.
“To give them all £10,000 we would need £17m. We have got 400 market traders and we estimate 110 B&Bs. It is going to be hard to administer,” he said.
The city has 21,000 businesses with fewer than 50 employees and only 7,000 have received support so far. It’s opening applications on Monday for two weeks but hasn’t decided on what basis to allocate the money.
Matt Griffith, director of
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Government looking at bringing in part-time furlough immediately
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
The government is listening to retailers about being allowed to bring back furloughed staff on a part-time basis, according to one senior source.
Although independent retailers are being asked to reopen from June, the Coronavirus Job Retention Scheme will only allow part-time furlough from August.
Given a cratered economy and uncertain demand, retailers are asking why the government insists on this all-or-nothing approach.
Some shops are gingerly reopening towards the end of the working week but would have to pay staff taken off furlough fully time.
“Part-time furlough has been raised by retailers and a number of MPs. It’s something that we’re looking at and try to respond to,” said the source.
“By extending the furlough scheme in the first place, and then extending it a second time, it shows that we’re listening. We do listen and hope we’re being seen to be flexible and responsive.
“Businesses are burning though cash with no changed in fixed costs. We are never going to have had perfection implementing schemes at such speed and scale.”
Self-employed owner-directors
Meanwhile, the government is still thinking about how to open up the Self-Employed Income Support Scheme (SEISS) to self-employed owner directors.
The problem, said the source, is that
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Only allowing part-time furlough work from August doesn’t make sense
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Shop owners are questioning why the government is only okaying furlough staff to work part-time from August, despite encouraging them to re-open next month.
Small retail businesses face a disastrous couple of months before furloughed staff are allowed to come back part-time, with office workers staying away and restaurants and bars closed.
Kate Evans owns independent fashion boutique Precious, which is based in the City of London and whose customers include City workers now working from home.
Evans said: “With offices and restaurants closed, we don’t know how much demand there will be when we reopen next month. The government says it wants independent retailers like us to reopen. Yet we can’t take back furloughed staff to work part-time during these crucial next couple of months. This all-or-nothing approach doesn’t make sense. The furlough scheme needs to be more flexible to support reopening.”
>See also: Rishi Sunak extends job retention furlough scheme to October
Many independent retailers are planning to reopen on a part-time basis initially.
Lobbyists say that the Treasury to open up the furlough scheme now to allow part-time work in retail, what with demand so weak. By August, many are afraid there will be no shops
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Small businesses could be facing debt of £105bn due to coronavirus
by Anna Jordan • • 0 Comments
Originally written by Anna Jordan on Small Business
New research shows that the UK’s SMEs could be racking up an unsustainable debt bill of up to £105bn during the coronavirus lockdown.
TheCityUK’s Recapitalisation Group suggest that by March 2021, the debt of UK financial non-profit corporations (PNFCs) could be between £90bn and £105bn, of which CBILS could contribute between £10bn and £20bn. They say that this level of unsustainable debt could stifle future employment, research and development, investment and general economic recovery.
To address the debt, firms may have to raise equity and/or restructure their debt. Historical data shows that the total amount of private equity investment in 2018 was £20.6bn, total private equity into SMEs in 2018 was £6.7bn and bank lending to SMEs in 2019 was £57bn. ‘Significant volumes’ of structured capital from existing and other sources is vital to the long-term competitiveness of the economy.
In a letter to the Bank of England governor, TheCityUK’s leadership council chairman, Adrian Montague, wrote: “Small unlisted businesses (including micro firms, family-owned businesses and sole traders) have different requirements. Many are financed by closely-held equity and branch bank lending; they have little or no contact with professional investors; and yet their resilience and prosperity is
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How to reopen your small business post lockdown – what we know so far
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
UPDATED: Boris Johnson has outlined the first tentative steps to reopen small business, including the phased reopening of shops and hospitality.
Shops will be able to reopen on June 1
Some hospitality services will be allowed to re-open from July 4
The government has published its document fleshing out prime minister Johnson’s nationwide address, which goes deeper into its strategy to help reopen small business.
Shops planning to reopen post June 1 could badge themselves “COVID-19 Secure” by following guidelines shortly to be published by government after consultation with business groups and others.
By July, the government would like to see remaining small businesses that have been forced to close, including hairdressers and beauty salons, pubs and hotels and cinemas also reopen.
But any phased re-opening of small businesses will be reversed if the rate of coronavirus infection creeps back upwards – as is already being seen in Germany and South Korea, which have loosened up their own lockdowns.
Reopen small business
Mr Johnson said: “We must also recognise that this campaign against the virus has come at colossal cost to our way of life. We can see it all around us in the shuttered shops and abandoned businesses and darkened
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Small businesses plea for an end to lockdown by the end of May
by Anna Jordan • • 0 Comments
Originally written by Anna Jordan on Small Business
Nearly two thirds (58pc) of small business owners want lockdown to wrap up by the end of May.
Buckworths, the UK’s only law firm which works with start-ups and high growth businesses, surveyed over 500 SME owners and decision makers to gauge attitudes towards the government’s coronavirus measures and the economic impact of the ongoing lockdown.
The research found that 20pc of UK SMEs in the UK will not survive another month without another boost to their cash flow. This rises to a sizeable 62pc in Northern Ireland, 31pc in the West Midlands and 30pc in the East Midlands.
Boris Johnson could be announcing his exit strategy in the next few days and urgent action is needed. Over a quarter (27pc) of the businesses surveyed don’t think that the government funding will be enough for them to survive the effects of the pandemic.
The research showed that those in more affluent areas were more optimistic about the future of their businesses – only 14pc of firms in Greater London and 13pc in the South East are expected to close down by the end of May.
Financial difficulties are being compounded by a lack of support from landlords. Almost
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Support for tourism, hospitality needs to be extended, says Ed Milliband
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Economic support for those small business sectors hit hardest by coronavirus needs to be extended once Britain emerges from lockdown, says Ed Milliband.
The shadow business secretary said that travel, tourism and hospitality will need extended help from Treasury even as the rest of the country opens up again.
Milliband, speaking in a Zoom conference call hosted by accountancy software firm Intuit, said: “Economic support must match the lockdown exit strategy. The support needs to go on for longer if lockdown goes on for longer. If you lift lockdown too early, the implications for the economy and for the country would be disastrous.”
See also: Small business minister trying to help owner-directors hit by coronavirus
Shadow chancellor Annelise Dodds, speaking on the same call, echoed Milliband, saying that those small businesses in the travel, tourism and hospitality sectors could face disruption “for years”, and that there needs to be an ongoing system in place to support them.
Ed Milliband also voiced support for the furlough scheme to be softened so that small business employees could do some work even while furloughed, while the country drifts back to work.
‘Small businesses are in the frontline of this crisis’
Many small businesses
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Don’t count on small business customers returning post lockdown
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Many Britons say they will feel uncomfortable going to newly reopened small business once lockdown is lifted.
Gyms, pubs and bars and beauty salons can expect customers to keep staying away, with over 60 per cent of customers saying they would still avoid them.
There is better news for garden centres with 70 per cent of Britons saying they would be happy to return once they are reopened, according to a YouGov survey for BBC Newsnight.
>See also: Half a million small businesses in financial distress
Clothing stores and hairdressers will also bounce back fairly strongly, with 48 per cent of people saying they would feel comfortable returning.
Public anxiety about going back into gyms, bars and restaurants will deflate small business owners hoping that the easing of lockdown restrictions will help kickstart the economy.
How comfortable would you feel visiting these businesses post-lockdown?
Comfortable (%)Uncomfortable (%)Don’t know (%)
Garden centres70256
Hairdressers/barbers48466
Clothing stores48466
Restaurants 37576
Coffee shops36586
Pubs and bars32635
Beauty and nail salons32608
Gyms30627
Source: YouGov
“For some businesses, particularly those which involve closer contact, or those whose clientele lean towards women or the old, simply reopening the doors again may not be enough to see customers flood back,” said Chris Curtis, political research manager at YouGov.
Women stay
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Less than 10% of businesses can access government coronavirus funding
by Anna Jordan • • 0 Comments
Originally written by Anna Jordan on Small Business
New figures show that most small businesses can’t access the government’s emergency coronavirus funding despite wanting to take advantage of it.
One set of statistics from UK Finance reveals that just 2,022 loans have been made to UK SMEs through the government’s Coronavirus Business Interruption Loan Scheme (CBILS), with less than 1pc of enquiries resulting in these loans.
Meanwhile, the Corona Business Impact Tracker from the British Chamber of Commerce (BCC) measures the impact of coronavirus on businesses as well as the effectiveness of the government’s emergency actions. The latest polling took place from 1-3 April and received 1000 responses.
The tracker shows that awareness of the schemes is high: 59pc knew about the CBILS and 19pc planned to use it. Fewer business owners (42pc) knew about the grants available to small businesses and 24pc planned to use it.
Polling numbers say that 8pc of respondents were unsuccessful in getting access to the CBILS. They cite that the application process was slow and that they couldn’t get responses from the relevant body. The BCC is optimistic that successful applications will increase in the coming weeks.
As for the grant schemes, 7pc of respondents were using them at the
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Two out of five small businesses will run out of cash within six weeks
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Two out of five small businesses expect to run out of cash with six weeks, according to a new survey.
And one in five small businesses say they will run out of cash within three weeks.
Small business revenues are set to decline by an average 60 per cent in April, with 69 per cent of businesses in leisure and hospitality expecting revenue to totally disappear.
>See also: Nearly 1m businesses on brink of collapse, warn accountants
Three quarters of small business say that coronavirus has already badly affected their business, and this looks set to worsen in April. Eighty per cent say their income will continue to decline this month, with more than one in three (36 per cent) expecting income to crash by more than 90 per cent.
Retail is the second-most badly affected sector, with 38 per cent of small business retailers expecting their income to totally disappear.
Businesses in IT and telecoms expect to be least impacted, with just under a quarter (23 per cent) saying they don’t expect to see any decline in their revenue compared to April last year.
If small business revenue does decline overall by 57 per cent as expected, this equates