Business leaders in Coventry and Warwickshire say companies have quickly adapted to changes in working practices but that cashflow is the biggest concern in the midst of the Coronavirus crisis.
The Coventry and Warwickshire Chamber of Commerce was responding to the British Chambers of Commerce’s new tracker that will serve as a barometer of businesses’ response to the government’s measures to support them through the crisis.
It will also track how quickly new government interventions, introduced to deal with the real-world impact of this crisis, are getting to the businesses at the front line.
The first set of polling was conducted from 25-27 March with responses from over 600 businesses across the country.
It revealed that a majority of firms reported a significant decrease in their revenue from both the UK and overseas.
Of most concern is the impact on business’s cash flow, an important indicator of overall economic health. In the survey, 18 per cent reported less than a month’s worth of cash in reserve, while 44 per cent reported only one to three months’ worth of cash in reserve. Only six per cent of respondents reported over 12 months’ worth of cash in reserve.
Following the government’s pledge to cover 80 per cent of a furloughed employee’s salary up to £2,500 a month, 32 per cent of respondents said that they were planning to furlough between 75 to 100 per cent of their workforce over the next week. More than a quarter of firms (26 per cent) were not due to use the scheme in the next week.
A majority of businesses have embraced the changes in working culture, with two thirds of respondents (66 per cent) using remote working and half (50 per cent) using videoconferencing.
However, 18 per cent of businesses had closed operations temporarily and, although no respondents had yet closed business operations permanently, both figures are expected to rise over the coming weeks and months.
Most businesses reported awareness of the government’s recent support schemes to help mitigate the impact of coronavirus as 61 per cent of firms knew details of the business rates holiday for the retail, hospitality and leisure sector; 59 per cent of firms knew details of the Coronavirus Business Interruption Loan Scheme; and 57 per cent of firms knew details of the Statutory Sick Pay refund.
The percentage of firms actively in receipt of this support was low but this is expected to rise in the coming weeks following the government’s official launch of the Coronavirus Business Interruption Loan Scheme and Job Retention Scheme on Monday 23 March.
Louise Bennett, chief executive of the Coventry and Warwickshire Chamber of Commerce, said: “It’s clear that companies have adapted extremely quickly to a very sudden change in the way the majority of us are having to work.
“It is encouraging that so many companies are aware of the support that is available and that is, partly, testament to the work Chambers have been doing to ensure that information is clearly communicated.
“The crisis is proving the adage that cash is king and cashflow, understandably, is the biggest concern for companies right now. That is why we are working so hard to keep firms informed of what support is available and are continuing to push for the available money to get out of the door as quickly as possible and into the accounts of companies across our patch.
“We have been in very close contact with our Local Authorities around the grant funding that is available to companies and businesses in our region can now find all of the links on our website in order to register their interest and eligibility.”
BCC Director General Dr Adam Marshall said: “The Coronavirus pandemic has taken a heavy toll on business and economic activity across the UK.
“While businesses have welcomed the unprecedented size and scope of the government support packages, our findings highlight the urgent need for that support to reach businesses on the ground as soon as possible. The majority of firms cannot wait weeks or months for help to arrive.
“There’s no escaping the scale of the challenge UK businesses are facing, yet many are already finding ways to contribute to the national effort to tackle coronavirus. Chambers and their members are working together to play their part, including gathering unused PPE equipment from local businesses and delivering them to the NHS. I’ve no doubt we will see further examples of resilience and innovation – the hallmarks of the UK business community – in the coming weeks and months.”