This is one of the worrying headlines from recent research by the Association of Practising Accountants (APA) following their survey of 1,024 owner-managed businesses across the UK. Click here to download the results.
Members of the APA – an association of leading UK Accountancy firms, including Armstrong Watson – surveyed their clients on the current impact of the Coronavirus on their business and how important the government support schemes continue to be for their survival. Businesses were also asked about cash availability, and a large proportion (40%) do not have enough money to see them beyond 8 weeks.
Other key findings from the region included:
Over a third of respondents have seen turnover reduce by over 70% since lockdown measures were introduced
A majority of businesses have used the Government’s job retention (furlough) scheme of whom 89% regard it as critical to their ability to keep staff on
Only 16% of respondent have applied for funding under the Government Coronavirus Business Interruption Loan Scheme of whom two-thirds said the scheme needed to work better.
Commenting on the findings, Paul Dickson, CEO and Managing Partner of APA Member firm Armstrong Watson said,
“This is a very worrying time for business owners throughout our regions and across a huge diversity of sectors too. Whilst the government has put in place a number of welcomed schemes to support owner-managed businesses over the initial period, mid-term and longer term the picture is going to be sadly much graver for some as we all adapt to a ‘new normal.’
“Our message to clients is to look beyond what’s happening now, carefully assess your business position over the coming months as we gradually move out of lockdown. Coming to terms with a potential new reality will be difficult but preparing for it is essential, whether that means utilising alternative funding, considering restructuring or optimising tax liabilities, these are just some of the many options businesses could take to aid survival.”
Armstrong Watson is hosting a free webinar with their cash flow experts on Thursday 30th April in response to the findings of the APA survey, looking at business sustainability post COVID-19 and offering advice on the actions business owners could be taking now to ensure longevity.
The firm is also offering business owners who are worried about their cash flow and business viability, a free, no obligation consultation with one of our Restructuring Partners, contact Mark Ranson on 07977 500725 or email mark.ranson@armstrongwatson.co.uk
