Covid-19 - Light at the end of the tunnel? What next?
By David Bryan, CEO of BM&T
As we head towards the end of what has been a very eventful 2020, the news of potential vaccine success has brought a bit of cheer to people and the prospect of a return to normal life at some point in 2021. Much has been written about what the “new normal” might look like and it will likely not be a return to exactly how things were before Covid19. There is much talk about an accelerating digital revolution and also a green recovery. Whilst such things may well become reality, many businesses face more immediate and pressing problems. Two recent reports highlight these issues.
McKinsey surveyed 2,200 SME’s in the five largest European countries and found a bleak picture1 . “One in five was concerned they might default on loans and have to lay off employees, while 28 percent feared they would have to cancel growth projects. In aggregate, more than half felt their businesses may not survive longer than 12 months - despite the fact that 20 percent of those surveyed had already taken advantage of the various forms of government assistance.” Deloitte have looked at the UK insolvency statistics2 . “We expect corporate insolvencies could be much higher in the first half of 2021 compared with previous years. They could potentially be even higher than the average 60% increase experienced at the height of the global financial crisis in 2009. Automotive, retail and food service are expected to be the most impacted.”
Businesses could well be asking if that light at the end of the tunnel is the proverbial train coming the other way
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