COVID-19 Business Update – 29 July 2020
Welcome back to our Weekly Update. We hope you and your family are safe and doing well. Read on for this week’s update.
Increase in UK Retail Sales and Business Activity Boost COVID-19 Recovery Hopes
The latest data from the Office for National Statistics showed retail sales rose by 13.9% in June compared with May, as demand among consumers returned overall spending close to pre-COVID-19 levels.
This improvement was fuelled by online spending, DIY, and food sales, as people undertake home improvements during the lockdown and continue to buy more food than usual while restaurants and pubs remained closed last month. If you need personalised guidance to get your business back up to speed in these challenging times, you may drop us a message so we can work out a plan.
UK Professors Make Breakthrough in COVID-19 Drug
Last week, Oxford University scientists’ experimental coronavirus vaccine showed early promise as it triggered a dual immune response in people aged 18 to 55 which lasted at least two months after they were immunised.
This week, three U.K. professors at the University of Southampton School of Medicine have made another “major breakthrough” in the treatment of COVID-19 patients. Results of the initial trial showed that coronavirus patients given the special formulation through a nebuliser were two to three times more likely to recover.
The study also found that the odds of patients developing a severe version of the disease were reduced by 79%, and their breathlessness was also “markedly reduced”. While the world races to develop a cure for COVID-19 and a vaccine has yet to be discovered, business must go on. Reimagining your business and re-evaluating your plans and strategies will help you rise to the occasion and lead your business through these uncertain times.
Temporary VAT Cut for Food, Non-Alcoholic Drinks, Accommodation, and Attractions
The government has announced that from 15 July 2020 to 12 January 2021, there will be a temporary reduction to the Standard Rate of VAT from 20% to 5% for supplies of food and non-alcoholic drinks from restaurants, pubs, bars, cafes, and the hospitality sector across the UK. This move is designed to increase customer demand in response to the economic crisis caused by the COVID-19 pandemic.
This is great news for the hospitality industry as they start to reopen, albeit on a reduced capacity basis. If you need some guidance on how to operate safely after a period of inaction, you may visit this resources page by the national tourism agency, which focuses on practical guidance for reopening during the pandemic. Meanwhile, if you need personalised advice for your business, feel free to drop us a message.
McKinsey & Company’s ongoing research shows that business optimism is increasing. While the business world is plagued with uncertainty at the moment, most sectors are confident consumer demand will return, and have made changes and improvements to adapt in the meantime. This data shows what we all probably know – entrepreneurs tend to be optimists by nature, willing to take risks and are open to change.
Small businesses don’t often have resources or profit margins of large companies to stay afloat and weather economic crises. What they do have is the agility to pivot and adapt when these problems come up. A positive mindset and willingness to adapt well get you far – well done to all for weathering the storm so far.
If you need help in navigating through these uncertain times or mapping out a post-pandemic strategy, reach out to us so we can work out a plan.
Technology tools when working from home
While telecommuting has become more common in recent years, the COVID-19 pandemic has significantly shifted the landscape into one that demands flexibility and employee autonomy. As companies transition their workforce from on-site to remote or a hybrid of the two, the office of the future might be in your home.
This Forbes article shares valuable tools to help smooth over some common challenges when remote working, as well as boost your efficiency and productivity.
You might want to check out some of the following tools they recommend:
- Google Hangouts
- Basecamp Business
- Box, Dropbox Business, and Google Drive
- DocuSign and HelloSign
Additionally, it is important to establish work-from-home protocols and communication best practices for your staff. You’ll want to set clear expectations and boundaries in terms of workday schedules, rethinking urgency and giving prompt replies, as well as doubling down on the grace in the event of unexpected work disruptions. If you need some guidance to keep your business moving through the crisis and beyond, get in touch with us so we can provide personalised advice.
U.K. Businesses Borrow £50B in State-Backed COVID-19 Loans
On Tuesday, the Treasury reported that close to 1.2 million businesses had received loans that are partly or fully guaranteed by the government. This takes the total amount borrowed by British businesses to £50 billion to help them survive the pandemic. Furthermore, this shows businesses’ continued need for support even as lockdown measures are eased.
What funding is available for my business?
The U.K. COVID-19 support programs continue to expand, as over £47.9 billion has already been approved as of July 21, 2020 to over 1.1 million businesses.
To cover the impact of the crisis, there are grants made available by the government such as the £1.25b Future Fund and R&D rescue package for fast growth businesses and smaller businesses with a Research & Development focus. The government recently expanded this rescue package.
There is also the Small Business Grant Fund, which is a one-off grant of £10,000 that supports small businesses that pay little or no business rates as a result of small business rate relief (SBBR), rural rate relief (RRR), and tapered relief. Businesses in the retail, hospitality, and leisure industries that use premises with a rateable value between £15,000 and £51,000, and will therefore pay no business rates for the current year, will receive grants of £25,000 from their Local Authority. For further details on eligibility and payment arrangements, kindly contact your local authority.
If your business has been severely hit by COVID-19 and you need more support, the government is giving small- and medium-sized businesses access to financial support through various initiatives such as the Bounce Back Loan Scheme (BBLS), where you can get up to £50,000 no-interest loans for the first 12 months. Approximately 1.08 million smaller firms have received a total of £32.79 billion through this scheme.
As for the Coronavirus Business Interruption Loan Scheme, which offers a maximum loan of £5 million made available through commercial banks, lenders have provided £12.2 billion worth of facilities to 55,674 companies. Meanwhile, the Coronavirus Large Business Interruption Loan Scheme has approved 428 loans worth £2.89 billion.
You can also claim for 80% of your employee’s wages plus any employer National Insurance and pension contributions if you have put them on furlough because of COVID-19 under the Job Retention Scheme, which has been extended until the end of October. You can check your eligibility here.
With all the financial assistance schemes available for businesses, it can be difficult to assess which one is suitable for your business. Let us help you evaluate your options.
Beware of Scams Related to COVID-19
Scammers are taking advantage of the COVId-19 pandemic to con people into giving their money or confidential personal information. Here are some of the Covid-19 scams to look out for:
- Scams offering COVID-19 testing, vaccine, or cure
- Fake charities
- “Person in need” scams
While the reason behind the fraud is new, the tactics are familiar. The best defence is to say No if anyone contacts you asking for your bank account information, credit card details, or driver’s licence number; someone you don’t know requests money through payment app or pre-paid gift cards; someone you don’t know sends you a cheque for some reason and asks you to send a portion back; or simply your gut tells you that it is too good to be true or it doesn’t feel right.
Get in touch
Contact us if you have any questions.