Eight in ten British small businesses think they will survive the coronavirus pandemic, according to exclusive new research that reveals top resilience lessons from the crisis.
Embracing digital, diversifying products and accessing emergency finance were found to be the main ways small firms have survived the Covid-19 crisis to date.
Research from Small Business Britain found two thirds (66%) of small businesses have seen their revenues drop.
Over half (53%) accessed government financial support to survive while 33% took out Bounce Back Loans, with a third saving this cash as a future ‘buffer’.
But in a sign of resilience, almost half of small businesses (44%) got through by pivoting and adding new revenue streams, with 52% adding new technology.
Small Business Britain's ‘How to Be Resilient’ report, supported by TSB, sets out to understand and promote the key factors contributing to business survival. It reveals that 70% of businesses embracing digital identified this as a crucial factor for future growth.
“Finding a way to press on successfully is key to ensuring small business survival and enabling them to get past the period of crisis and into a more stable period of growth,” said Michelle Ovens, founder of Small Business Britain.
“The crisis has been devastating for many firms, but those that have survived have used digital and diversification to their advantage, as well as drawing upon financial support, alongside other kinds of help from communities, peers, friends and family.
"While it is an experience no-one would want to repeat, there are many lessons to be learned from this crisis. Businesses fearing for the future should remember it is not too late to adapt or to reach out. There is much that can be done, even in the bleakest of situations.”
A third of firms cited Bounce Bank Loans as a critical lifeline enabling them to continue, with a quarter using it to pay urgent office costs and 18 per cent using it to pay staff costs.
“The pandemic delivered a shock to the economy like no other in living memory," said Adeel Hyder, business banking propositions director at TSB.
"The speed and scale of the government’s response has been critical. As this report bears out – for most small businesses, access to government support schemes like business rates relief, the furlough scheme and the Bounce Back Loan Scheme has been a determinant of survival.
"As well as forensic eye on cash flow, riding new digital trends will be key to having a successful business in 2021.”