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‘Calm before the storm’: UK small businesses fear for their future  


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‘Calm before the storm’: UK small businesses fear for their future  

https://www.ft.com/content/2bef51e5-f581-4ef5-af95-3c344ed7a238

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The number of loans approved by banks for SMEs in the second quarter was about 14 times higher than the average quarterly total of loans and overdrafts provided to SMEs in previous years. ..

up to 40 per cent of bounce back loans could default....Yet this part of the economy also tends to attract little in the way of equity support to help repay these debts.

 

Edited by Saving For a Space Ship
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Next years going to be ugly when the repayments kick in.  Good time to be an insolvency practitioner. 

Average loan size is £30k with an interest rate of 2.5% after the first year.  That's monthly payments of £532. I can't see them writing loans off but I can see them extending the term, giving everone a repayment "holiday" or allowing businesses to just pay the interest. 

"Equity support" makes me laugh, As if there should be investors lining up to take equity in a bankrupt {Nail bar|restaurant|pub|coffee shop|estate agents}. 

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Talking specifically about retail and hospitality here. In the part of London where I help run a store, I've noticed the following things so far:

1 Certain shops that had recently started up (talking since December), or were involved in a dodgy sub-letting arrangement (ie they weren't registered for biz rates and so couldn't claim the disruption grant) have not re-opened.

2 Most restaurants have re-opened. Surprisingly (so far) it seems to be those who don't bother with take-away who seem busiest. Otoh certain take-away shops have kept going throughout.

3 Certain pubs have re-opened. It tends to be those with a good outdoor area, a good meal rep, or those who had a regular clientele. However one or two of the budget type pubs have failed to re-open so far.

4 Certain chains and supermarkets are as busy as ever eg Tesco, Primark, Sainsburys, Aldis, Poundland etc.

5 There are always big queues outside banks and post offices. I'm fortunate in being able to pop down Baker Street where there aren't any queues in order to do business.

On another note (and it's been mentioned on this board already) it's noticeable that ordering stuff from suppliers takes longer - both because the supplier needs a certain amount of customers to justify despatch (talking overseas import) and also because the couriers seem under the cosh.

Of course, things can change in a matter of days. We've probably done better since the lockdown in our shop than beforehand (and this is possibly because of younger people moving into our neighbourhood), but come the darker days September and onwards, who knows what will happen?

Edit: Forgot to add. The big chain coffee shops, in particular Starbucks, seem to have been hit hard. Locally run cafes seem to be doing well - although it's often hard to tell as the owner (who may be Albanian or Algerian) will have his cronies around for a coffee.

Edited by Trampa501
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18 minutes ago, Council estate capitalist said:

Next years going to be ugly when the repayments kick in.  Good time to be an insolvency practitioner. 

Average loan size is £30k with an interest rate of 2.5% after the first year.  That's monthly payments of £532. I can't see them writing loans off but I can see them extending the term, giving everone a repayment "holiday" or allowing businesses to just pay the interest. 

"Equity support" makes me laugh, As if there should be investors lining up to take equity in a bankrupt {Nail bar|restaurant|pub|coffee shop|estate agents}. 

It's been a little surprising to me, but two nail bars close to my shop recently re-opened and have been busy. There again, the barbers and hairdressers have also been very well patronised (the area is a local hub for budget and specialised haircuts).

 

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  • 415 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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