The majority of UK SMEs feel positive about their recovery from the pandemic, with over half exceeding their pre-pandemic turnover.
More than half (54 per cent) of UK SMEs have now either met or exceeded their pre-COVID turnover levels.
Just over one in five have already exceeded their pre-pandemic levels, with 31 per cent predicting that they will match these figures soon. Only one in seven believe that their road to recovery is ‘uncertain’.
The study was conducted by Paragon Bank and also shows that 90 per cent of businesses are now feeling optimistic about COVID recovery. This positive feeling is particularly prevalent amongst SMEs and has risen from 86 per cent in September to 92 per cent in May.
Companies with fewer employees actually predicted the quickest rate of recovery, with 64 per cent expecting turnover matching or exceeding pre-pandemic levels, compared to 47 per cent of larger SMEs, with between 100 and 239 employees.
Almost two-thirds of SMEs experienced cash flow problems throughout the pandemic, which was the most common challenge for UK businesses. Loss of profit, which was an issue for just over half of SMEs, was the second most common challenge. This was followed by late payments, which affected 34 per cent of businesses.
As SMEs emerge from the pandemic, cash reserves are still a key issue, with 40% currently uncomfortable with their cash reserves.
In the eyes of almost half of SMEs, the government was their main source of business support throughout the outbreak of Coronavirus and 67 per cent of business owners approve of the level of support they received.
Many SMEs also considered financial providers and industry and trade bodies as key sources of support throughout the pandemic and were believed to be essential by 38 per cent of SMEs and 36 per cent of SME owners. The furlough scheme was the most commonly used initiative, which was taken up by 44% of businesses. 27 per cent used the Coronavirus Job Retention Scheme, Business rates relief (27 per cent), or VAT deferral (26 per cent), while 19 per cent of owners used the Coronavirus Business Interruption Loan Scheme (CBILS).
Among those surveyed, 12 per cent had already used RLS. Of those, over half used the funds due to cash flow problems, while 28 per cent chose to invest in more equipment and 27 per cent opted to buy more stock. Take up of RLS was more than double among larger SMEs, with 31 per cent of the businesses accessing the scheme.
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