Almost six out of 10 small and medium-sized business owners (57%) who expect to make a loss this year anticipate they will be back in profit within two years, a survey has found.
More than a quarter of SMEs (27%) expect to make redundancies as part of the potential recovery actions over the next 12 months because of the COVID-19 crisis, one in four anticipate having a recruitment freeze, while 13% say they will ask staff to take a pay cut.
Some 13% of SMEs anticipate closing part of their business and 7% do not expect the business to survive and some 6% anticipate they will have to sell their businesses, according to research of 306 SME business owners and bosses commissioned by MBH Corporation Plc (FRA:M8H).
On the day that it was revealed by HM Treasury that 1.33mln businesses in the UK have been supported through government-backed coronavirus lending schemes, the MBH survey found that more than four out of ten (43%) SME owners felt government support for the sector during the coronavirus crisis has been good or excellent.
Another four out of ten (40%) describe the government support as average and 17% believe the government support has been poor.
Part of the government support for SMEs has been via loan schemes, which in the UK has been the Coronavirus Business Interruption Loan scheme (CBILS), which has been taken up by almost 70,000 businesses in the UK this year.
Of the SME owners and senior managers surveyed, just under one in four (38%) said that their businesses took out such loans.
Just over one in ten SMEs surveyed (11%) said they borrowed more than GBP50,000, with 4% borrowing over GBP100,000.
Of those who took out government loans, 18% they expect to pay the loan back within a year18% said they expect it will take between one and two years, with a further.
“Whilst there is no sugar coating for the effect the COVID-19 crisis has had on the small business ecosystem, it is pleasing to see how many were able to leverage off the government support and are positive about the way forward,” said MBH chief executive Callum Laing.
“Optimisim is an inherent trait of most small business owners and we’re seeing some incredible innovation as companies pivot to serve their clients best in these fluid times.
“We know that for many small business owners there have been many sleepless nights and tough conversations had over the past is months, but there are also plenty of businesses out there, not just in big tech, that have been able to find an angle and thrive during these fluid times.
“Many of the big companies of tomorrow will be ones that are really finding their feet today.”
MBH Corporation has acquired seven SMEs in 2020 and now has 17 companies in its portfolio and is considering further acquisitions in 2020.