Businesses need support from state, survey says

MOST businesses will need at least two weeks’ notice before reopening, according to the results of a survey published last week by Chambers Ireland.

The survey seeks to quantify and highlight the impact of Covid-19 on businesses in towns, cities and regions across the country.

The third in a series, the survey has over 1,300 responses and was conducted between April 24 and 28.

The previous Chambers Ireland survey results, published on April 9, found that 84 per cent of businesses expect revenue to decline by in excess of 25 per cent in the next three months, up from 73 per cent two weeks earlier. Fears about cashflow and liquidity were the greatest concerns of micro-enterprises of under 10 employees, with closures and staffing being a concern for larger businesses across many sectors.

Last week’s survey found that 85 per cent of businesses have closed to some degree, with 27 per cent having scaled back activity. Twenty-four per cent have front of house closed with staff working from home, and 34 per cent have shut completely. Only 15 per cent remain open.

Twenty-five per cent of businesses have said that it will take at least a month.

There is a small minority in agri-food, tourism, and hospitality which will have to wait until next year to reopen.

For those businesses that are closed, the typical weekly overheads are around €2,000. A quarter of firms said that their overheads are greater than €5,000 per week.

Of those that need to restock, the typical amount required to re-open is €3,000, with 25 per cent of firms having to spend over €8,000 on restocking

For physical distancing measures, the typical cost will be €2,000, with 25 per cent spending in excess of €5,000.

Of the businesses who have been hardest hit (those which have lost more than half of their revenue for the next three months), 60 per cent project that their 2020 annual earnings will be less than half of what they were expecting at the start of the year. Sixty-eight per cent of businesses have invoices outstanding, with €40,000 being the median amount owed.

‘With lockdown measures due to expire on the 5 May, it is critical that Government engage with businesses,’ said Chambers Ireland chief executive Ian Talbot. ‘The purpose of this latest survey was to help us understand not only how deep the economic impact has been on the business community, but what supports they will need to re-open as the restrictions are phased out. While the economy was shut down to a large degree in a matter of days, the process for reopening will not be as straightforward.

‘The question for many business owners is soon going to become not ‘Can we keep going?’, but ‘Can we afford to reopen? This data verifies what we have been telling Government over the past few weeks – we need a clear plan for reopening the economy. This includes advance notice of the dates that various sectors will reopen, a clear strategy on what sectors will reopen first, information on what protocol will need to be in place and whether support will be available to financially assist businesses to reopen. The business community needs direct support from Government if it is to reopen. The objective of many of the supports to date, such as the Wage Subsidy Scheme, has been to ensure that employees are retained on payroll for when the economy reopens.’

He said that a similar approach is required to ensure that overheads, other than wages, receive some form of subsidy or grant. ‘Without this aid, the chance of businesses successfully reopening and maintaining employment is significantly reduced.’