New research says that most small businesses are ready to re-start and embrace the “new normal”. However, the need for financial support remains significant. This is why it is vital that owners are aware of all the funding options available to them, including alternative finance.

Nearly 90% of small firms ready to reopen but fight for survival remains

According to a survey by the British Chambers of Commerce (BCC), the vast majority of small businesses are ready to open their doors again, with almost 90% saying that they need three weeks or less to do so. Notably, almost two-thirds stated that they could start to un-furlough staff as restrictions eased.

However, despite the positive message behind the figures from the BCC, data from the Office for National Statistics (ONS) and the Federation of Small Businesses (FSB) are a reminder of how extremely difficult conditions are and how much access to financial support remains critical.

The ONS has reported that over 40% of businesses have less than six months’ worth of cash reserves left, while the FSB has revealed that one-third of small businesses that have shut their doors as a result of the lockdown are concerned that they won’t be able to reopen.

Ability to restart and rebuild rests on availability of financial support

It is clear going forward that a lot of small businesses, whether they can reopen quickly or not, will need financial support: access to capital will be critical to their survival. This is why it is important that small businesses are aware of all the funding options available to them, in terms of both government-backed schemes and the services of regular lenders.

For small businesses that are struggling to access funds from the likes of the Coronavirus Business Interruption Scheme, the Bounce Back Loan Scheme or the Local Authority Discretionary Grants Fund, it is especially important that they have the full picture in terms of regular lending services.

Reports show that many small businesses are not getting the help they need from government business support schemes because they are excluded from them, can’t access them or can’t get enough support from them.

Awareness of state, high-street and alternative funding options critical

With regard to regular lending services, small business owners should be aware of both bank and non-bank facilities. Tellingly, as the government has expanded the number of lenders that are affiliated to its business support schemes, it has added more non-bank operators. This is for a good reason: alternative finance offers some clear benefits for small business owners.

In the wake of prolonged caution from traditional lenders, alternative finance facilities such as invoice finance, asset finance, peer-to-peer lending and crowdfunding are proving a vital source of capital for small businesses, both for safeguarding cashflow and for essential investment. These facilities, which offer a more personalised approach to lending, are helping small businesses survive and grow.

Despite the first glimpses of light at the end of the tunnel, small businesses remain in a battle for survival. If these firms are going to successfully restart and rebuild, it is vital that they get the financial support they need, from government schemes, banks and alternative lenders.

To find out more about A&T Business Associates services, contact Tony Hedger on 01903 602211 or tony.hedger@atbusinessassociates.co.uk.