New survey reveals almost one fifth of small businesses wouldn't survive another lockdown
2-minute read
One in five small businesses wouldn't survive another lockdown, according to new research from Simply Business.
We spoke to over 500 small businesses across the UK to understand the effect a second lockdown could have on their operations.
Almost one in five (17 per cent) think they'd be forced to stop trading permanently. And while a third (32 per cent) said they’d survive, they think a second lockdown would impact them worse than the first.
How long will it take to recover?
In addition to the businesses that think they’d be forced to stop trading permanently, and those that think another lockdown would be worse than the first, we discovered that:
- 34 per cent think a second lockdown would have the same impact
- just five per cent think they would cope better than the first
We also asked businesses how long it might take to return to normal after Covid-19. In terms of business recovery, we found out that:
- 24 per cent of businesses think it will take 12-18 months to recover the money lost during Covid-19
- 19 per cent think it will take six to twelve months
- 12 per cent think it will take 18-24 months
- 12 per cent think it will take two to three years
Finally, as business suffer a drop in the number of customers walking through their doors, our survey highlights that:
- 24 per cent believe it will take between 6-12 months for their customer numbers to return to normal
- 14 per cent think this could take over a year
But there are reasons for optimism
It’s positive that 68 per cent of small businesses expect employee numbers to remain the same. But 21 per cent still expect employee numbers to decrease, with 13 per cent of those expecting numbers to decrease significantly.
Businesses have similar mixed feelings about overall confidence. The good news is that the majority feel comfortable about continuing to trade while adhering to government guidelines. 43 per cent of those businesses said they feel comfortable, while 30 per cent even said they were very comfortable.
That being said, 62 per cent of business owners told us that they feel less confident about the long-term prospects of their business.
Did lockdown have any positives for businesses?
Despite the challenges of Covid-19, businesses told us that there were some positives.
Positive | % of businesses |
|---|---|
Staff learned new skills | 25% |
New customers | 21% |
Adopted new technologies | 19% |
Expanded to offer more products or services | 17% |
When it comes to new technologies being adopted, 42 per cent of small business owners told us they’re more reliant on technology because of coronavirus. These are the types of technology that businesses are now using:
- 47 per cent are using messaging apps more for business (like Facebook Messenger or Whatsapp)
- 33 per cent are using social media more
- 36 per cent have introduced contactless or online payment systems
- 25 per cent have started to use online delivery services
A lifeline in these economically challenging times
Our UK CEO, Alan Thomas, said that while it’s “promising to see the level of resilience and innovation in the small business community”, business owners are still reliant on macroeconomic policy.
He added: “Government’s decision to implement local lockdowns could decide the fate of many small businesses.
“SMEs account for 99% of all UK businesses, and contribute a combined £2 trillion annually. Put simply, we need small businesses to bounce back if we’re to recover economically.
“This is why we’ve launched a £10,000 Business Boost grant. We’ll be giving away £10,000 to one entrepreneur – to help them start or revive their business – providing a financial boost, and potentially a lifeline, in these economically challenging times.”
Small business owners can apply for the Business Boost grant here. Applications are open until Monday 28 September and the shortlist will be announced by 9 October. The winner will be announced in early November.
What do you think about our latest survey? Let us know in the comments below.
Looking for self-employed insurance?
With Simply Business you can build a single self employed insurance policy combining the covers that are relevant to you. Whether it's public liability insurance, professional indemnity or whatever else you need, we'll run you a quick quote online, and let you decide if we're a good fit.
Start your quote
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
Keep up to date with Simply Business. Subscribe to our monthly newsletter and follow us on social media.
Subscribe to our newsletterInsurance
Public liability insuranceBusiness insuranceProfessional indemnity insuranceEmployers liability insuranceLandlord insuranceTradesman insuranceSelf-employed insuranceRestaurant insuranceCommercial van insuranceInsurersAbout
About usOur teamAwardsPress releasesPartners & affiliatesOur charitable workModern Slavery ActSection 172 statementSocial mediaSite mapAddress
6th Floor99 Gresham StreetLondonEC2V 7NG
Sol House29 St Katherine's StreetNorthamptonNN1 2QZ
© Copyright 2023 Simply Business. All Rights Reserved. Simply Business is a trading name of Xbridge Limited which is authorised and regulated by the Financial Conduct Authority (Financial Services Registration No: 313348). Xbridge Limited (No: 3967717) has its registered office at 6th Floor, 99 Gresham Street, London, EC2V 7NG.