Impact of Covid-19 and expected impact of Job-Keeper closure
As we move into 2021 impacts of Covid-19 and the expected impact of Job-Keeper closure are becoming a reality that SME businesses will have to face.
At Capify we are always interested to see what is happening with the SME businesses of Australia. Covid-19 had a major impact on SME businesses in Australia. But how severe or at what cost?
Australian Government provided supports such as Job-keeper and commercial lease assistance for businesses to survive during Covid-19. However, it is coming to an end at the end of March 2021. Cases are at reduced volume and post-COVID life is getting back to normal. But, what about SME businesses? Are they coping well with the “new normal” and how are they planning to survive once the Govt. financial support comes to an end?
To find out answers to all these questions, recently we have conducted a study to find out how SME businesses were impacted by COVID-19 and what is expected after the Job-keeper assistance comes to an end.
We asked how were businesses impacted by COVID-19? 64.47% of the participants mentioned their cash-flow was impacted significantly. Other major impacts were a significant decrease in sales at 42.11% and downsizing businesses at 28.95%. With 27.63% of the businesses had to receive financial assistance to continue operating. Please find the chart below to understand various issues that were mentioned.
We have also asked SME businesses about their expected impact when the Job-Keeper ends at the end of March 2021. Once again, the major impact expected is low cash-flow for businesses at 53.95%. And 39.47% of businesses expect to require financial assistance to continue their operation with 28.95% of businesses are expecting a possible business closure. To find out a variety of answers mentioned by SME businesses regarding their expected impact once Job-Keeper closes please refer to the chart below
We also asked how the businesses would rate the impact of COVID-19 and the expected closure of Job-Keeper where
High = (Temp./Permanent closure of business)
Medium = (Severe reduction of operating capabilities)
Low = (Minor issues that can be recovered)
Most businesses at 44.74% rated the impact as a medium level. At 63.16% Most of the businesses did not seek any financial assistance.
With all the data under consideration, Capify has decided to support SME businesses with a new financial solution “Covid Flexible Loan”. It is a short-term finance solution that allows business owners to expand and grow their business without having to commit to and worry about fixed monthly payments due to the volatility of your business in this environment.
With flexible repayments that are based on future sales so it remains consistent with your turnover during these challenging times and the impact on your cash flow is minimised, meaning we only get repaid as you get paid from your customers and you can continue to boost your growth as you recover from the losses of the pandemic.
To learn more about Covid Flexible Loan, please visit: https://www.capify.com.au/covid-flexible-loan