The average SME in South East has lost 27% of their income as a result of Covid-19. Many SMEs in the region are reporting significant losses due to Covid-19, with 13% seeing a decrease of more than 70% of their income.
According to new research from Aldermore bank, 12% of SMEs in the region state the health of their business has already been damaged long-term.
SMEs in the region have taken steps to reduce costs as part of their Covid-19 response plan with strategies including:
- Decreasing operating costs and discretionary spending (19%)
- Furloughing staff (19%)
- Cut salaries (13%)
- Withdrew savings (7%)
- Applying for a Coronavirus Business Interruption Loan (8%)
- 33% of SMEs in the region have adjusted their business plans to reflect the ‘new normal’
- SMEs in the region have looked at ways to adapt their business – the ways SMEs have done this include shifting more business online (14%) and investing in new technology to operate remotely (6%)
Tim Boag, group managing director, business finance at Aldermore, said: “Whilst the economy has started to open up, the Covid-19 pandemic continues to have a profound impact on the SME community. The current situation is uncertain, and the threats of further localised lockdowns are a concern to businesses who are trying to recover from the economic shock of the pandemic. However, it’s encouraging to see that SMEs are being resilient in the face of the adversity and we praise their efforts to adapt their business models, find different and innovative ways to increase income, as well as diversifying into new markets.
“As a bank born out of the last financial crisis, we understand the difficulties SMEs have experienced and the ongoing issues they face, and we are here to help. That’s why we’ve launched our ‘Small But Mighty’ business campaign to share real stories and experiences of SMEs who, as the backbone of the UK economy, are tackling the challenges of Covid-19, as well as providing businesses with special guides that offer tips on a range of measures such as how to reduce costs, ways to adapt their business, or find suitable funding opportunities in these uncertain times.”