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HOW HAVE SMALL FIRMS SURVIVED? Elise Horsfield
from Peternomics
by StPetersYork
The uncertainty of the impact of the coronavirus on small business owners is staggering and likely to be substantial. Entrepreneurs are being forced to take drastic steps to continue operating and many are fearful about their futures. The widespread closing of stores and businesses in the United Kingdom and around the world due to the coronavirus is unprecedented. Factories and many other businesses have closed by policy mandate, downward demand shifts, health concerns, and many more factors. Many of these closures may be permanent because of the inability of owners to pay ongoing expenses and survive the shutdown. Moreover, some small businesses may have closed due to them already being at financial risk before the pandemic crisis hit.
From researching this topic, I found that last year, small businesses and the self-employed expected total Covid-19 costs to reach £69 billion;however, nearly 12 months later, the latest reports revealed that the total anticipated cost will be upwards of £126.6 billion which is nearly double the initial estimated amount.
Despite business challenges, new entrepreneurs are on the rise and some have been resilient and adaptable. For example, home baking and online businesses have changed to work around coronavirus regulations therefore the demand for their products will not be as affected as other businesses. Businesses with relatively limited financial resources are most at risk, but none are immune to the global pandemic’s effects. By midApril, according to a report from the Facebook & Small Business Roundtable, about a third had temporarily stopped operating, and by mid-May more than half had laid off or discharged employees.
Overall, Coronavirus has had a huge impact on small businesses resulting in large losses of demand and overall profit. Some support is available for small businesses such as a new ‘Restart grant’ which became available from April 2021 for businesses in England to help reopen the high street after lockdown. The ‘Restart Grant’ offers a one off cash grant of up to £18,000 to businesses including pubs, restaurants and salons and non essential retail businesses can get up to £6,000.
