A Message For Small Business Owners in the UK
Small businesses are the backbone of our economy; they employ 60% of the private sector workforce in the UK, sit at the heart of our local communities – and are now facing challenges on an unprecedented scale in light of the COVID-19 pandemic.
In recent weeks, we have been speaking to our 10,000 Small Businesses UK (10KSB) graduates across the country, to better understand the impact of COVID-19. It has already been severe; businesses from a range of sectors have reduced operations and have seen revenue streams collapse. Even high-growth, well-performing SMEs face a challenging fight to survive. If the current climate persists, 30% of those asked believe they will be out of business within three months, and 59% expect to close within six. But this crisis is all-encompassing and impacting every sector across our economy.
As an organisation, we are acutely aware of the importance of SMEs and our responsibility to provide these businesses with support to help them survive this crisis and lead the recovery; for our 10KSB businesses we have been providing regular webinar touchpoints, online resources and one-to-one emergency business coaching.
The figures above look stark, but what our conversations have also told us is that persistence and innovation are key. None of us can predict what’s going to happen, how long this will run for or how it will evolve, but the future of small business will be shaped by those businesses which are able to pivot and innovate. Critically, these businesses will need to be creative in the ways they are staying connected to their customer-base and the markets they serve. These markets will inevitably come back to life, and if you have maintained that connectivity throughout, it will be easier to piece the puzzle back together on the other side.
Our 10KSB graduates are part of our broader family at Goldman Sachs and we take huge pride in their achievements to date. This programme has been running for a decade now and we’ve seen first-hand the impact that small businesses can have in their communities. And even in these challenging times, we’ve heard some incredible stories of resilience and entrepreneurial spirit, serving as inspiration for us all.
One is Austen Smart of Future DJs, which brings DJ training and equipment into schools now that they are recognised by UK exam boards as academic music instruments. During this time, Future DJs has accelerated the launch of their online platform to help provide music education to children home from school and in tandem are raising funds to enable the team to provide this service low cost, and free to all children with parents who have lost their jobs. Another is Rob Wilson of Toast Ale, a craft brewery that produce beer from surplus bread that would otherwise be wasted. Before coronavirus, the majority of Toast Ales’ revenue came from bars and restaurants, which has now gone. They have been creative around increasing their online retail trading, and are launching a campaign where, for every beer sold, they are donating a meal to the charity Feedback.
There are other alumni focused directly in the health care space; Ed Sena of Anytime Care 2020 has been rapidly adapting the office side of care home administration to remote working, meaning a more ready supply of workers and demand for their services. Whereas three separate 10KSB alumni are now in talks about pivoting their organisations to set up a joint venture to deliver hand sanitizer throughout the UK.
This is a real test for each of us – on an individual level, within our families, as well as within our professional spheres. But getting through this time is absolutely worth fighting for; the landscape will be full of opportunities for people building and driving new businesses with purpose.
Richard J. Gnodde
Richard J. Gnodde is Chief Executive Officer of Goldman Sachs International