Small businesses say they could recover to pre-pandemic revenue levels within 10 months, despite fall in confidence
New research claims that on average, small businesses expect their income to return to pre-pandemic levels within 10 months of the government restrictions lifting.
Meanwhile, more than a third (35%) of small business owners surveyed by employee benefits firm, WorkLife, said they believe it will take them between seven to 12 months to get back to the level they were at before the first lockdown. Nearly a quarter (23%) think it will take longer than a year.
Only three per cent of respondents believed they don’t expect to ever return to these levels.
However, despite this cautious optimism, the research did reveal that fears that small businesses have over their financial circumstances have grown.
Confidence in future finances decreases
A quarter (26%) of small business owners think their revenue will increase over the next 12 months – down from 31 per cent when surveyed in March this year.
Meanwhile, nearly a half (49%) said they expect their income to reduce – up from 45 per cent in March.
Only a fifth (21%) of small businesses polled expect their revenue to remain stable.
The survey also found that more than three quarters (78%) of small businesses are still using the government schemes to support themselves.
A quarter (25%) said they are still relying on the Business Interruption Loan Scheme, while 24 per cent are using the Bounce Back Loans to support their businesses. And 23 per cent are making use of the Coronavirus Job Retention Scheme (CJRS).
Small businesses need to adapt to ‘evolving demands’ of market
Meanwhile, only one in 10 small businesses who have used any of the emergency government Covid support are no longer doing so.
Steve Bee, Director of WorkLife by OpenMoney, said: “Just as our so-called Freedom Day saw the UK being split by those excited to get back out and others more wary of the journey back to normality, SMEs are now falling into two main camps – those feeling renewed optimism and those for whom the future remains far from certain.
“Firms in the latter must remember that their ability to adapt in the face of a crisis is what has kept them going, and this will be no different during the recovery phase.
“Bosses should therefore be taking stock on what changes – such as alternative products and sales routes or flexible working arrangements – could be implemented longer term to help future proof the business and ensure it is equipped to meet the evolving demands of customers.”