This Thursday will mark one month since the UK has been under a national lockdown. Since then, Britain has seen the closure of all non-essential outlets, including restaurant, bars and gyms.
For the country’s 5.9m SMEs (that account for over 99% of all UK businesses), there is a terrifying uncertainty regarding when (and how) things will return to” “business as usual” again.
Are SMEs getting what they need
Since the outbreak began, the Government has been quick to announce schemes to help salvage the SMEs most affected;?The Coronavirus Business Interruption Loan Scheme (CBILS), is the most noted of these.
On paper, the Government-backed aid looked promising. Available to firms with an annual turnover of up to £45m, the scheme provides up to £5m to qualifying businesses, with the Government guaranteeing that lenders will get 80% of their money back if the borrower can’t repay.
However, as the weeks pass since the programme was launched, it appears this lifeline isn’t as readily available as struggling business owners would have hoped.
In fact, last weekA report originally published in UK Finance showed that only 6,016 of the 28,461 applications had been approved.
How small retailers are adapting ?
The low number of business owners meeting the threshold to qualify for these loans paints a worrying picture for SMEs. However, some small businesses and particularly those in the retail sector have managed to stay afloat during the crisis.
Speaking to Real Business Lucy Serafi, the owner of home plant provider,?The Urban Botanist describes how her online approach has given her some leeway during the pandemic;
?Sales have been particularly good for us over the last four weeks. We re online only and because we don’t do the crazy volumes the big retailers do, so we have continued to be able to fulfil with next day delivery. I think that’s been massively important.
Small retailers have a real opportunity in this climate.
“People have to be at home more, and if you have to be at home more you may be likelier to spend more time and money on your home environment”.
So, it appears that if you are a smaller retailer tapping into the lockdown self-care trend, (and you can fulfil your delivery obligations and plug your products on social media), you can still make decent sales during COVID-19.
But this news isn’t new, in fact a study by?tech firm?Emarsys, showed that sales of luxury goods shot up by 57% as consumers sought to treat themselves during lockdown, a retail trend also known as the “lipstick effect” where shoppers are more likely to buy small gifts from themselves during times of crisis
Why it’s sink or swim for SMEs
But what about business owners who do not fall under this bracket” Well, it appears that quick innovation is crucial to keep sales on track, says Charlotte Bailey, co-founder of healthy catering company,?Buddha Bowl;
“Catering has definitely been one of the hardest-hit sectors as a result of the global pandemic. It really was incredibly difficult as it felt like our business of 11 years was effectively being switched-off.
We quickly realised we could offer deliveries so wanted an easy way for our customers to know this and make orders.
“But soon enough we set up our website with order capabilities using Square Online Store, which was simple and quick to do ourselves. Adapting to the ?new normal” was difficult but we found that our customers were missing their usual routines and favourite treats.”
With so many of the UK’s favourite chain restaurants, such as McDonald’s closed until lockdown laws are lifted, it could be a chance for independent food retailers to reach a wider market.
Deliveroo and UberEats (the UK’s top takeaway delivery services), are giving their consumers incentives to order through their outlets, (such as free delivery), which could also support struggling restaurants which have been forced to shut their “eat-in” options.
As the Government announces another £1.25bn scheme to help start-ups and those involved in innovation grow during COVID-19, it is difficult for more traditional businesses without funding to remain positive. However, agility and good old-fashion entrepreneurial spirit is what SMEs can and should be relying on now to survive.