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Coronavirus costs small businesses over £21,000 each

Coronavirus has cost small food and drink businesses over £21,000 each in lost work, earnings and loan repayments, according to new figures.

Analysis of over 250 small food and drink businesses by insurer Simply Business, reveals how over half (55%) are at risk of permanently closing due to the pandemic.

One tenth (19%) believe they’re likely to close within three to six months, well over a tenth (15%) within six months to a year, and another tenth (14%) within the next three months. 

Looking ahead, the study also reveals how SMEs within food and beverage feel about life after coronavirus, with just over half (52%) worrying about losing customers and their jobs from the pandemic. 

One third (35%) are also concerned about running out of money, with one in three (32%) admitting they have had to borrow money from friends and family to keep afloat. 

One fifth (20%) are concerned about being able to pay back the money borrowed while one in five (18%) are worried about going completely bankrupt.

The study also found that 71% of SMEs were able to apply for government grants, loans and schemes and well over a third have felt particularly supported.

Greater communication and transparency from the government about the impact to small businesses and the self-employed was the area most respondents felt could have been improved upon. 

Alan Thomas, UK CEO at Simply Business, comments: “No business has been able to escape the impact of the pandemic – and that’s no different for small businesses and the self-employed. They’re the lifeblood of the economy, and with many of these at risk of permanent closure, so much is at stake for our local communities and wider economy. 

“Few small businesses have been hit as hard as those in the hospitality industry, and it's clear that many will take time to recover. Small business owners and the self-employed have shown how creative, determined and resilient they are throughout the pandemic, and we know they’re going to be crucial as the UK economy looks to bounce back. 

“With many pubs, bars and restaurants now able to open their doors again, we’re hoping to see hospitality businesses begin to emerge from the most challenging period and start to get their livelihoods back on track.”

Simply Business has launched a free Financial Support Checker to help small businesses, landlords and the self-employed to quickly determine what financial support and schemes are available to them during the coronavirus pandemic. 

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