Small and medium-sized enterprise (SME) leaders are optimistic about post-Covid-19 recovery time, suggesting it will take an average of 12 months for their businesses to make up for the lost revenue.
Chirag Shah, CEO, Nucleus Commercial Finance, who commissioned this research, comments, “it’s encouraging to see such optimism among SMEs about their projected finances as they return to business as usual.”
With consumer demand accelerating after the easing of lockdown restrictions, over half a million SMEs suggest it will take between 10-12 months to make up for the loss caused by Covid-19.
Research indicates that medium-sized businesses are most confident about their recovery, with over a quarter believing it will take between seven to nine months to return to their pre-Covid-19 financial state. However, small-sized businesses believe it will take them between 10-12 months.
Whilst some of these predictions are hopeful for the future, several companies expect the lost revenue to have a long-lasting impact – with one in five sole traders concerned that they will never recover.
Research reveals that 23 per cent of younger business owners, between the ages of 18-34, hope to see a recovery in the first four to six months, while 24 per cent of owners aged 55 plus don’t see their business recovering for at least one to two years. SMEs also expect to spend an average of £97,000 to help their businesses grow in 2021.
The route out of lockdown will not come without its challenges. Having experienced the effect that lockdown easing has had on business sales already, SMEs are showing a much more optimistic outlook than a few months ago.
The research also found that London and the South East SMEs are the most optimistic about business recovery – almost a quarter of SME leaders in the South East predicting a 10–12-month recovery span and a quarter of those in London hoping between seven to nine months.
With 50 per cent of SME leaders within the North West and South West of England predicting a longer one to two year recovery time, it is clear that not all are feeling so confident.
Shah highlights that “[the] Government and industry must collectively raise awareness of the varying support measures available to aid these businesses in their longer-term recovery, ultimately providing a much-needed boost to our economy.”