Many FSB (Federation of Small Businesses) members have been experiencing weakness in trading in recent days, including all those in sectors that are consumer-facing, in the events industry and many more, this is now accelerating in response to the Coronavirus crisis. The prospect of the virus spread is frightening; and the changes necessary to combat it may well mean the suspension of doing business altogether for many SMEs. They are seeing rapid closures of business and public spaces in local areas and nationally, in Italy and increasingly other nearby nations across the EU, and wonder if the same will happen in the UK. They worry about their own health, and what happens if they are too ill to run their business or have to self-isolate – and they also worry about the wellbeing of their staff and cashflow. The FSB website has some very valuable advice.
The Budget last week laid out five key ways that businesses can get UK government help during the crisis, according to the FT, including “time to pay” tax suspension, business rates relief, grants for the smallest enterprises, risky loans underwritten by the government and reclaiming sick pay costs – you can read about those five ways here
The Sunday Times also asked (and answered) some key questions for SME business owners, including:
- Will the banks lend? (Yes, but probably only to existing customers)
- Can the Government help? (See above Budget summary)
- What if customers can’t or won’t pay? (Business interruption and credit risk insurance will help in some cases)
- How are debts recovered? (if a company received a statutory demand for a debt, it must settle within 21 days or face a winding up petition)
- What if a debt becomes unserviceable? (A company voluntary arrangement – CVA – a form of insolvency, can keep a business afloat while allowing the directors to remain in place)
- Is cash all that matters? (No. Taking an eye off day to day business can be dangerous. For example there has been a rise in cyber attacks and email scams purporting to be about coronavirus information and help)
More great advice from the FSB: Please keep talking to everyone. Before this crisis escalates, touch base with your clients; your suppliers; your bank; your accountant; your solicitor; your neighbour; your FSB; any other business groups or associations; and fellow small businesses and the self-employed in our 5.8 million strong community. Even if you have to self-isolate, you are not alone. Everyone will be affected. We are all in this, together.