SMEs are the backbone of any healthy economy; they drive growth, provide employment opportunities and open new markets. In the UK they account for three fifths of the employment and around half of turnover in the UK private sector.
To see how small business owners feel about getting back to business now that lockdown is lifting, Starling Bank and the Great British Entrepreneur Awards carried out a survey asking 300 SME’s how they feel about the future and the impact of the pandemic on their business. Alexandra Frean, Head of Corporate Affairs at Starling, takes us through the findings.
What really stood out was the tenacity and resilience of small business owners. In spite of the challenging climate, 80% said that they were confident they would recover from the impact of Covid-19 and three quarters (75%) said that they feel more confident about the future than they did a month ago. Contributing factors to this positivity included the easing of lockdown restrictions, reopening of shops and non-essential travel being permitted.
The findings really highlighted the agility of SMEs; 40% of respondents confirmed they had made significant changes in order to adapt to the crisis. Pivoting trends included switching their business so that it could operate online, prioritising digital innovation and organising deliveries to people’s homes. A great example of this came from one Starling business customer Dot McCarthy, who runs Cronkshaw Fold Farm in Lancashire. In April, she launched Goat Zoom calls, enabling companies or individuals to hire one of her resident goats to join Zoom meetings. This left-field idea generated more than £20,000 in just six weeks and resulted in coverage in national newspapers and ITV This Morning.
What also became clear from our research was the fact that many business owners have undertaken huge personal sacrifices in order to keep afloat. Our study found that 30% of SME owners put their personal funds into their business to ensure funding. More than a third (36%) credited their staff with staying positive and going above and beyond to help keep things running.
We also wanted to find out how entrepreneurs were fairing in terms of their mental health. Two thirds of business owners said the pandemic had caused them stress and that they had been rushed into making decisions. A key contributing factor to the negative impact of the virus on mental health was the loss in revenue as 19% confessed to experiencing financial losses.
Despite these difficulties and the difficult economic forecast, the strength of British business owners and their teams will help to drive the UK forward. Their resilience should never be underestimated, especially given the contribution that SMEs make to the economy; they account for 99.9% of the business population and three fifths of the UK’s employment.