COMMENTARY: COVID-19
Answering the SOS for SMEs Free-to-use platform Save My Local demonstrated how tech could leverage customer loyalty to help small businesses stay afloat in a crisis. Product owner Jack Maddock and business owner Chris Hugo take up the story…
Running a business is tough at the best of times. When you’re everything from the CEO to the cleaner, it’s easy to feel underpaid and overwhelmed. Cashflow doesn’t always flow and footfall doesn’t always fall. So, when the lockdown rules forced local business to pull down the shutters, many felt completely lost. Shops and services that once thrived on neighbourly custom had their source of income severed. For many, stumping up for bills and finding staff salaries became impossible. British Business Bank said 60 per cent of small firms went into 2020 with less than £5k in credit balances. A couple of weeks after the UK’s March lockdown, accountants reported that 83 per cent of SME clients were already suffering from stress, with 11 per cent even feeling suicidal. By May, UK Finance estimated that a fifth of small businesses had less than a month of cash reserves left. A quarter of owners had used their personal savings to stay solvent; and almost a fifth said they were likely to cease trading or would not survive. It’s been a grim and harrowing period for Britain’s independent businesses – and, despite the biggest government-backed rescue scheme in history, they are not out of the woods yet. Of those that qualified, many have run through the local council-administered grants and one in six smaller firms now relies on government-backed debt through the Coronavirus Business Interruption Loan Scheme (CBILS) or the Bounce Back Loan Scheme (BBLS). But that’s exactly what they are: loans. And loans need to be repaid. And yet, there are kind and creative people who’ve been reaching out to help. One of the first was a band of quick-thinking fintech problem-solvers,
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who pioneered a voucher platform, Save My Local. It was launched less than two weeks into lockdown and designed with every small business owner in mind – even for those who struggle to find the on-switch on a laptop. The idea was straightforward: we’ll help you set up a webpage to promote and sell vouchers that can be redeemed by your customers against future purchases. Its execution was seamlessly speedy, deceptively simple and, best of all, 100 per cent free. Jack Maddock is one of the team of people behind it. “This initiative was born out of a tweet by Jason Bates of 11:FS, and then Mike Kelly, who runs Curl, got on board and brought the idea to life,” he explains. The platform has been a great example of how powerfully collaborative fintech can be. “People just jump on a Slack channel and ask ’what needs doing’. ’Hey, I’ve joined, I’m a copywriter’… ‘hey, I’m a designer’… ‘I’m a developer‘… ‘I just want to help – this seems really cool!’,’’ says Maddock. The voucher platform, which was up and running in just one week, enabled a number of local businesses to stay afloat in those early weeks when nobody came through the doors. The advanced sales made enough of a dent in their outgoings, like rent and staff salaries, to keep them alive. One of the business owners who’s loved using Save My Local is Chris Hugo, who owns Hugo Barbers in Winchester, Hampshire. For him, the idea of shutting up his buzzing business was almost unthinkable.
“I couldn’t really imagine that my businesses were going to be shut,” he says. “In theory, it was quite a safe business, but that changed overnight. It was quite scary, because you’re thinking ‘not only do I need to keep the business going, but all the people that work for me’. I’ve got a great team and didn’t want to lose them, or make them redundant.” For Hugo, the voucher scheme was a lifesaver. The instant payments helped to keep his six staff on the payroll and gave him some much-needed financial breathing space. “I think there were two months’ pay cheques that we had to find. To get that bit of cashflow back into the business was worth so much.” However, when the site first launched, Save My Local struck upon a surprising marketing challenge: its altruistic offer seemed too good to be true. We’re a sceptical bunch, and getting over this first hurdle was a major challenge for the team, which found itself fighting for inbox space with corporations. Maddock recalls some of the first feedback he received from businesses. “They’d have 25 other emails saying ‘free way to get you through the crisis’, so when they saw ‘free way to sell vouchers’,” they thought ‘I’ll just add that to my pile’. The quote I always remember from the early days was someone saying ‘well, the best and worst thing is that you’re free!’.” Both Maddock and Hugo have been touched by the widespread support and kindness from ordinary people. With the
It’s been a real learning curve, for me. Just to listen to businesses, and to what people are going through
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