What businesses need to know to survive during the COVID-19 outbreak

The coronavirus (COVID-19) outbreak has had a massive impact on businesses all over the UK. As many businesses struggle to stay afloat, the UK Government has stepped in with unprecedented measures to help them through the crisis.

Read on to see how it affects your business, and the steps you can take to safeguard your financial future.

Keeping your team safe

The health, safety and financial well-being of your team is paramount as this time. 

How do I protect my team?

You can find advice from the NHS on how to stay safe by protecting yourself and your employees here.

What do I do if someone falls ill at work?

The government has given specific advice to businesses on how to deal with the outbreak, including what to do if someone The government’s advice is that employees should work from home wherever possible. As part of this there is guidance on staying at home, including for those who have picked up the virus.

What happens if I have employees abroad

If your company has an international footprint, or employees abroad, the Foreign & Commonwealth Office has advised against all non-essential travel. There is advice on how to manage this here.

How do I pay my employees?

There are a number of government schemes already announced to help businesses, including paying up to £2,500 of your employees' salaries per month for the next three months. More information can be found here.

Protecting your business

Now is the time to review all plans you have for this year, and consider what is realistic, and what has to change.

What short-term actions should I be taking to ensure my business can carry on running?

The background section of government advice to businesses lists a number of practical actions that can be taken immediately, such as ensuring all staff contact information is up to date.

As part of this, drawing up a plan if your office has to shut down, or key staff cannot make it into the office, should be done as soon as you can. This would be part of a broader Business Continuity Plan: help with how to create one of these is available from the Federation of Small Businesses (FSB), here.

Can I get or claim on my insurance?

The Association of British Insurers (ABI) has put together a Q&A on the Coronavirus, which includes business and trade credit insurance. Unfortunately, unless your policy specifically covers disease, which is usually purchased as an extension, you are unlikely to be able to make a claim. The ABI suggests that you contact your insurer or broker to find out whether you are covered for losses as a result of COVID-19.

My business relies on meetings with clients. What are my options?

Over the past few years, virtual meeting technology has made giant leaps forward. So whether it’s Skype, Zoom or something else, it’s now possible to have virtual meetings easily – and in many cases for free.

Secure your financial position

As every small business knows, cashflow is vital, so it’s important to see what can be done to preserve it as soon as you can.

What government help is there for me?

The government has a number of schemes (COVID-19: support for businesses) to help businesses:

• Small business grant funding of £10,000 for all businesses who receive small business rate relief or rural rate relief. You will be contacted by your local authority if you are eligible – you do not need to apply.

• Grant funding of £25,000 for retail, hospitality and leisure businesses with property valued between £15,000 and £51,000. If you want to know whether you’re eligible, or how the relief will be provided, contact your local authority.

• A 12-month business rates holiday for all retail, hospitality and leisure businesses in England. Enquiries should be addressed to your local authority.

• The  HMRC Time To Pay Scheme, where you may be able to arrange a longer time to pay your tax bill. HMRC has also set up a tax helpline.

• The government has also rolled out a separate package of support for the self-employed known as the Self-employment Income Support Scheme. You can claim a taxable grant of up to 80% of your trading profits up to a maximum of £2,500 per month for the next three months. Payments will start in June.

• If you're self-employed, you can also seek funding from the Coronavirus Business Interruption Loan Scheme, or CBILS, managed by the British Business Bank. You can apply if you have an annual turnover of up to £45m, operate using a business bank account, and generate more than 50% of your revenue from trading activity. It doesn't matter whether you're a sole trader, freelancer or a limited partnership. 

What are the banks doing to help my business?

Although the government is helping with direct assistance for businesses, it may be worth looking into whether you can get access to funding now, before you may need it.

HSBC and Natwest have announced a £5bn support fund for SMEs, Lloyds Bank has announced a £2bn fund, while Barclays has pledged to support its SME customers. Talk to your bank to see if they can help, but bear in mind that waiting times will be long.

The government has also made significant sums available to the banks to help them extend loans to small businesses under the Coronavirus Business Interruption Loan Scheme. These loans will be interest-free for 12 months.

Detail of how the funds will be distributed isn’t yet clear, but a number of participating lenders will be made available via the Funding Xchange website over the coming days. Access to these loans is subject to eligibility rules, which are still being worked out.

If you’d like to see what finance you could be eligible for today, from Funding Xchange’s panel of existing lenders. It takes only a few minutes, but bear in mind that there’s a high chance you won’t be successful – at least initially. It’s worth trying again though in a day or two, as the situation could change quickly.