As the economy begins to get back up and running, we want to ensure that support for owner managed businesses is targeted where it is most needed, and that Government has the evidence base to prioritise effectively. AAB has been working in conjunction with the Association of Practicing Accountants (APA), a network of 20 professional service firms who collaborate on industry issues enabling better representation and support to the owner managed business sector.
Research among 615 of these businesses across the UK carried out by the APA in August and September suggests that owner managed businesses who have survived the last six months are now more resilient but still face significant challenge and are having to adapt. In particular:
- 82% are confident that they have the access to finance they need to get back up and running
- 72% are confident they will be able to retain furloughed staff once Government funding ends
- Only 7% see Government support being withdrawn as their biggest challenge
- 55% have at least three months cash in the bank up from 41% in April
- 23% reported turnover at lower than 50% of pre-lockdown levels down from 43% in April.
- 28% have less than 8 weeks cash in the bank
- 31% think it likely they will have to make redundancies in the next 3-6 months
- 16% have turnover of between 70% and 100% lower than before the lockdown was introduced
Owner managers are also having to adapt the way they work:
- 49% are likely to make home working a permanent option for at least some of their staff while
- 56% see virtual meetings as the default option going forward.
- Across professional and financial services 76% of respondents indicated that they were likely to make home working a permanent option for at least some of their staff.
The research also indicated strong support for a continuation of the Government’s Coronavirus Business Interruption Loan Scheme (CBILS):
- 63% of those who have applied felt the scheme worked well up from 33% in April
Commenting on the findings APA Chairman Martin Muirhead said:
“The impact of Covid-19 on the owner managed sector has been significant. Nonetheless what our latest research suggests is that those businesses who have survived are now generally more resilient.
“However, we are not yet out of the woods with over 30% of these businesses likely to have to make redundancies in the next 3-6 months and 28% with less than 12 weeks cash in the bank. As drivers of jobs and growth across the real economy these businesses continue to need clear direction and support from Government as the economy gets back up and running.”
The research was carried out among 615 owner managed businesses between 1st August and 2nd September.