New survey: the impact of coronavirus on UK small business is set to exceed £69 billion
3-minute read
A Simply Business survey has revealed that Covid-19 is set to cost small business owners £11,799 on average – with 67 per cent having been forced to temporarily close.
And with a total cost to UK SMEs exceeding £69 billion, it's estimated over 230,000 have already been forced to permanently stop trading.
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DownloadWe surveyed 3,700 small businesses and self-employed people across the UK for our SME Confidence Report.
While the report reveals that the coronavirus lockdown has had a profound impact on small businesses across the country, signs of resilience give reason for optimism about the future.
Small businesses estimate Covid-19 will cost them £11,779 on average
We asked small businesses how much they think Covid-19 will cost them in total, including lost work, earnings and total revenue.
The 3,700 business owners surveyed revealed it would cost them £11,779 on average. Applying this figure to the 5.8 million small and medium-sized businesses in the UK, this amounts to a total cost of over £69 billion.
We also asked businesses owners whether they’re likely to close down:
- 41% of small business owners fear their business is at risk of permanently closing due to the pandemic
- 14% believe they’ll be likely to close within one to three months
- 12% believe they’ll be likely to close within within three to six months
- 11% think they’ll close within six months to a year
Worryingly, four per cent of small business owners say they’ve already closed permanently because of the pandemic – an estimated 234,400 closures across the UK.
Two-thirds of businesses have had to temporarily stop trading
67 per cent of small and medium-sized businesses have had to temporarily stop trading, while 28 per cent are earning less money and 21 per cent are operating but have lost work (including contracts and customers).
17 per cent say they’re unable to work and aren’t eligible for the Self-employed Income Support Scheme (SEISS). Nine per cent have furloughed their own staff.
What are small businesses most concerned about?
The coronavirus pandemic has led to a number of concerns for small business owners.
Concern | % said this was top worry |
|---|---|
Losing customers or jobs | 49% |
Running out of money | 36% |
Paying back friends, family or private loans | 20% |
Bankruptcy | 12% |
Paying back government support | 10% |
How are businesses getting financial support?
Our survey also revealed the various ways in which self-employed people have been getting financial support during the pandemic.
A third of all people surveyed (35 per cent) said that they've borrowed from friends or family.
Meanwhile, over a fifth (22 per cent) have used credit cards, and just under one in 10 (eight per cent) have taken out wider or private bank loans.
Are small businesses accessing government support?
When it comes to the government support, 56 per cent said they’ve been able to successfully access government support, and just under half (47 per cent) said it was easy to find.
But – worryingly – this means over half of businesses might be finding it difficult to know where to look, with 44 per cent either unable to access government support or choosing not to.
That's why we've created a financial support checker to help businesses find out what funding they could be eligible for.
Find out what financial support you're eligible for
Just answer a few quick questions about your business and we'll tell you which financial support schemes you may be able to access
Start now85% set to remain self-employed in show of resilience
While the coronavirus pandemic is causing widespread uncertainty for small businesses, it’s encouraging to see signs of resilience among the community.
With small business accounting for 99 per cent of all British business, their success is vital for the economy.
Over a fifth (22 per cent) are feeling optimistic about life after the pandemic has eased, while three-quarters (75 per cent) say they’ll continue or restart their business.
Not only that, a further 10 per cent said they’re confident they’ll start a new business.
With small and medium-sized businesses at the heart of the UK economy, it’s positive to see that there is widespread hope about the future.
Alan Thomas, Simply Business UK CEO, said: “No business has been able to escape the impact of the pandemic – and that’s no different for small businesses and the self-employed. Yet they are the lifeblood of the economy, and with many of these at risk of permanent closure, so much is at stake for our local communities and wider economy.
"While it’s an undeniably challenging period for those running a small business, we know entrepreneurs have always shown resilience in abundance. We’re inspired by their optimism and resourcefulness and believe this will only grow as we continue through the phases of lockdown.”
Simply Business have a dedicated support page, with plenty of practical resources to help small businesses and the self-employed through the coronavirus pandemic – including a guide on the coronavirus support available for businesses.
How are you feeling about the future? Let us know in the comments below.
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Written by
Sam Bromley
Sam has more than 10 years of experience in writing for financial services. He specialises in illuminating complicated topics, from IR35 to ISAs, and identifying emerging trends that audiences want to know about. Sam spent five years at Simply Business, where he was Senior Copywriter.
We create this content for general information purposes and it should not be taken as advice. Always take professional advice. Read our full disclaimer
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