18% of SMEs a month away from collapse says survey

1 April 2020  

 Almost a fifth of all UK SMEs, which would include many garages, could be just a month from collapse due to the impact of the anti-Coronavirus restrictions.

18% of small and medium sized enterprises could be forced to close within four weeks, according to a survey of 13,000 businesses undertaken by the Corporate Finance Network, which represents independent accountancy firms.

Despite the support measures from government, if the lockdown lasts three months or more, accountants in the network report 31% will have to close down their business by June.

The organisation is pushing for what it calls a “Rescue and Recovery” incentive. Kirsty McGregor, founder of The Corporate Finance Network explained: “This would be asking the more robust small businesses to ‘buy’ the ‘at risk’ businesses in their sector, with a view to retaining the employees and maintaining the trade and turning it around once the lockdown is over.

Kirsty added: “We are asking the Treasury to fully consider our proposal, with them underpinning it with grants for supporting employment.”