We conducted a similar survey last year, which revealed that COVID-19 was costing small business owners more than just financial losses. Many were experiencing mental strain, a loss of customers, reduced morale, and staff redundancies. The survey also highlighted that many business owners were unprepared for the impact of Covid-19, with nearly two in three either having no funds, or insufficient funds, to carry them through this difficult time.
A year on, we wanted to see if things had changed and how business owners are holding up.
A rise in business confidence
Across the board we were pleased to see that the business owners who participated in our survey reported that they now have a more positive outlook for the future of their companies.
80% of respondents said that they are ‘very confident’ that their company can have a positive future. This is in comparison to 71% who felt similarly confident this time last year, a 9% increase in confidence over what has been an incredibly challenging period.
52% of respondents said that they are confident they will continue to ‘do good business’ which compares with 41% last year. This represents an encouraging uplift of 11%. In fact, 40%of respondents reported an increase in turnover with 11% of these seeing a significant increase.
Working from home may be here to stay
Most businesses are continuing to adapt to the evolving situation with at least some homeworking on a regular basis. Businesses have had to make some major adjustments to their working practices and infrastructure to ensure that, despite the pandemic, it is ‘business as usual’.Earlier this year we asked our network of experts for their advice on how our clients could best adapt to ensure that ‘WFH’ is effective, safe and affordable.
The majority of businesses accept that it is increasingly likely that some degree of remote working will continue for the immediate future, if not permanently. Our survey revealed that only 50% of business owners now thought that their business would return to ‘normal’once lockdowns are lifted. This is a considerable 11% drop compared to the result of 61% in last year’s survey.
What was really concerning was that three in five of respondents (60%) reported the biggest impact to their business has been ‘mental strain’ as a result of the pandemic. This was higher than numbers recorded against financial losses (35%) or lost customers (32%). It is perhaps not surprising, as on top of the financial strain, some people have found themselves balancing work with childcare while schools have been closed.
However,some have experienced contrasting challenges such as feelings of isolation and loneliness. For many people, going into the office provides a sense of routine, structure, and security; it ensures that they get to see people every day and make social connections, which we know is good for our mental health. Swapping this for staring at your own four walls all day and dealing with a constant stream of video calls and meetings, has taken its toll. While the impact of the pandemic can be assessed in financial terms, the consequences on our mental wellbeing could potentially be longer lasting and much harder to see and measure.
Re-establishing financial stability can be challenging, with a quarter of respondents reporting financial losses as a result of the pandemic. There is no denying the past year has been tough on small companies but there does seem to be a growing appreciation of local businesses and the need to support them for the good of the local community. Business owners have shown great resilience and adaptability, despite the bleak economic backdrop, with a few showing true innovation and coming out stronger. In fact, two in five owners reported that turnover had actually increased, with 11% reporting a significant uplift and 29% a slight increase.
Our help and advice continues
We were immensely proud that 52% of respondents, over half of which were our clients, stated that they found an accountancy firm provided the most valuable advice during this period. This was higher than those that found friends (28%) and family (25%) helpful for advice.
We will continue to assist our clients and are encouraged to know that many have found our dedicated COVID-19 news and support area on website useful. You can find more information about this here COVID-19 .
Based in Dartford, Blue Rocket Accounting provide accounting and bookkeeping support for businesses in Dartford, Sidcup and Bexley, as well as further afield across London and the South East. We take pride in our personal approach and encourage all business owners to get in touch about any of these issues via social media or phone us on 01322 555 442 or email firstname.lastname@example.org.