Pandemic increases support for small businesses
From the Coronavirus Business Interruption Loan Scheme to Eat Out to Help Out, small businesses in the UK have received a significant amount of Government support during the Coronavirus pandemic. Another important area of support has come from consumers themselves, many of whom have taken it upon themselves to seek out local small businesses instead of global entities likely to survive anyway.
A new survey has revealed that 64% of small businesses feel the pandemic has increased support and awareness of the SME sector while separate research suggests that this trend will continue, with 62% of respondents planning to stay loyal to the local businesses that helped them through lockdown with 44% indicating that lockdown has changed their shopping habits permanently to be more local.
Since the start of lockdown SMEs have borrowed over £12bn in government-backed loans. This support network demonstrates the vital importance of this sector that employs over 16 million people in the UK and provides 52% of private sector turnover. The importance of this sector looks like becoming more prominent than ever as tech giants increasingly lose trust in tech giants and corporations.
Luke Davis, CEO and Founder of SME investment firm IW Capital, comments on the trend:
“Small businesses have had to work incredibly hard to survive this period, from pivoting their offering to a digital platform to making tough decisions about furlough. One positive that does seem to have come out of this period, however, does seem to be a much greater awareness in the public of the importance of small, local businesses and why supporting them is so vital.
While no business can, or perhaps even should, survive purely on the goodwill of consumers, it does allow firms disrupting established sectors a chance to make an impact. This is especially true of firms with a genuine compassionate goal at the heart of their business, whether that be environmental or societal, firms that make an impact will, hopefully, in future be able to cut through corporate nonsense in a way that may have previously been more difficult."