Half of the small and medium-sized enterprises (SMEs) in a new survey say that they will last less than six months as going concerns due to the Covid-19 lockdown.
Details of the survey by representative body Isme come as concerns mount that a lack of liquidity will sink many businesses even if they have availed of existing Government Covid-19 supports. “The absence of liquidity will cause thousands of potentially viable SMEs to go under in the next few months,” said Isme CEO Neil McDonnell. Its data suggests the average SME owes €78,000 to other businesses.
Mr McDonnell’s organisation is pressing the Government to follow Germany’s lead and introduce a grant scheme for business owners which would assist with liquidity. A similar scheme in Ireland would cost around €2.5bn, Mr McDonnell estimated. Isme is also seeking changes to Ireland’s examinership regime to make it less expensive.
Some 489 businesses were surveyed by Isme on the challenges they face due to the impact of the coronavirus. Of those, 5.5pc said their businesses would cease trading. A further 5.9pc said their business would stay viable for up to a month. Some 18.5pc predicted they would stay viable for between one and three months, while 25.8pc said they would continue as a going concern for between three and six months. A further 11.3pc predicted they would stay viable for between six and nine months, and 34pc believed they would still be going concerns in nine months’ time.
Of those surveyed, 28.6pc had laid all their staff off, 47.9pc had laid off some staff and had some on the wage subsidy scheme, while 23.5pc had seen no effect on their staffing.