Nearly 20 percent of all UK firms have less than a month’s cash in reserve, and nearly half will furlough 50% of staff this week, a British Chambers of Commerce (BCC) study shows.
The BCC’s first Coronavirus Impact Tracker, which surveyed a representative sample of 600 British companies, painted a picture of the effects of the lockdown on cashflow, cash reserves and staff numbers.
While the study found that the majority of firms (62 percent) have three months’ cash in reserve, it also unearthed the following:
The most pressing concern for the companies surveyed was the current impact on cashflow. While 44 percent of the respondents said they have between one and three months’ cash in reserve, only six percent reported having enough cash to cover the next 12 months.
As most lenders, creditors and credit management firms have had to adapt very suddenly and implement working-from-home policies for call centre agents, and manage the data protection aspects from doing so, the BCC survey shows that most respondents have embraced new working practices.
Two thirds of the firms (66 percent) are using remote working and half (50 percent) are using video conferencing apps. However, 18 percent of businesses had closed operations temporarily and, although no respondents had yet closed operations permanently, both figures are expected to rise in the coming weeks and months.
"The majority of firms cannot wait weeks or months for the help to arrive"
BCC director-general, Dr Adam Marshall, said: "While businesses have welcomed the unprecedented size and scope of the government support packages, our findings highlight the urgent need for that support to reach businesses on the ground as soon as possible. The majority of firms cannot wait weeks or months for the help to arrive."
He added: "There’s no escaping the scale of the challenge UK businesses are facing, yet many are already finding ways to contribute to the national effort to tackle the coronavirus pandemic. Members are working together to play their part, including by gathering unused PPE equipment from local businesses and delivering them to the NHS."
Most of the companies were well aware of the various government support on offer; 61 percent know about the business rates holiday for the retail, hospitality and leisure sector, 59 percent knew about business interruption loans and 57 percent knew about the statutory sick pay refund.