11/08/2021

Business Update – 11 August 2021

Welcome back to our Weekly Digest. Read on for the latest updates and some ideas to help us all move forward.

Britain to Relax Some Travel Restrictions for COP26

Britain will relax some travel restrictions to help delegates attend the United Nations climate conference in Scotland later this year. There will also be a shorter quarantine period of five days for those from “red list” countries who have been vaccinated.

Meanwhile, those coming from amber or green list countries will not be required to self-isolate on arrival to the UK, regardless of whether they’re vaccinated or not.

Prime Minister Boris Johnson has pushed for COP26 to be an in-person event rather than virtual, believing face-to-face negotiations will achieve more in the battle against global warming.

Report: UK Recovery Still Unsteady Despite Job Surge

Although the relaxation of lockdown restrictions in July boosted hiring among UK firms, staff shortages due to the pandemic and Brexit could still undermine the recovery, according to professional services group BDO.

In its latest business trends report, it was found that the jobs market strengthened last month, as hospitality venues were allowed to operate without limited capacity. However, many firms reported labour shortages, partly due to the pandemic and Brexit.

BDO’s employment index also rose by 1.57 points to 107.62 in July, showing the strongest climb in hiring so far this year.

£750 Million Insurance Scheme for Live Events

Live events are set to be covered by a £750 million government-backed insurance scheme to stop mass cancellations due to COVID-19. Organisers have found that insurers will not cover them for cancellations caused by the pandemic.

However, the government announced it has partnered with Lloyd’s to deliver the Live Events Reinsurance Scheme as part of the Plan for Jobs, where the government will act as a ‘reinsurer’ and offer a guarantee to make sure insurers can offer products to cover organisers if restrictions shut events down.

The scheme will be available from September and run until the end of September 2022.

Business Closures in Q2 Second Highest Since 2017

The number of UK businesses that shut down in the second quarter of the year was at the highest level since 2017, according to a report from the Office of National Statistics. The number hit 105,455, and was 43% higher compared to the same period last year.

The largest increase in business closures came in the transport and storage sectors, as well as professional, scientific, and technical industries. All sixteen of the major groups also showed an increase in closures.

New Strategy to Help Hospitality Venues Bounce Back

Business Minister Paul Scully launched a new strategy to ensure England’s pubs, bars, restaurants, and other hospitality venues will be able to build back after the pandemic and thrive long-term. The Hospitality Strategy which you can find here focuses on reopening, recovery, and resilience.

COVID Local Support Grant Extended

The government’s COVID Local Support Grant has been extended until September, bringing it in line with the end date for furlough and other COVID-related support. The funding is ring-fenced so that 80% is used to support families with bills for food, key utilities and other essentials. Across England, the total new funding is £160 million.

Cash Boost For Apprentices Launched

Employers of all sizes in England can now apply for additional funding to help them take on new apprentices. The boost to the apprenticeship incentive scheme has been available to claim from 1 June. Businesses can apply to claim £3000 for each new apprentice hired as a new employee from 1 April until 30 September.

Debt Respite Scheme ‘Breathing Space’

Under the debt respite scheme called Breathing Space, those facing financial difficulties will be given 60 days to get their finances back on track, with most interest and penalty charges frozen, and enforcement action halted.

Professional debt advice will also be provided. Recognising the link between debt problems and mental health issues, these protections will be available for those in mental health crisis treatment for the full duration of their crisis treatment plus another 30 days.

Please get in touch with us if you need any help with your cashflow. We are here to help.

Recovery Loan Scheme Launched

The government has launched a new Recovery Loan Scheme to help companies access loans of £25,000 up to a maximum of £10 million. The loans will include 80% government guarantee and interest rate cap of 14.99%.

This is in addition to the extended furlough until 30 September and the New Restart Grants scheme.

Job Retention Scheme Extended Until End of September

The Coronavirus Job Retention Scheme has been extended until 30 September 2021. It will remain unchanged until the end of June, and a phased reduction in the level of funding will be implemented from 1 July 2021.

Currently, employers can claim grants equal to 80% of a furloughed employee’s reference pay. Grants for each worker are capped at £2,500 per month.

For claims starting 1 July 2021, the grant will be reduced to 70% of the reference salary and capped at £2,187.50 per month. It will be further reduced to 60% of the reference salary with a cap of £1,875 starting 1 August 2021.

You can read more about it here.

SME Brexit Support Fund Launched

A £20 million SME Brexit Support Fund has been announced to help businesses adjust to new customs, rules of origin, and VAT rules when trading with the EU.

Traders will be able to apply for a grant of up to £2,000 to pay for practical support for importing and exporting. This fund will help businesses prepare for the implementation of import controls that will take effect from April and July.

More details can be found here.

Kickstart Scheme grant

  • Provides funding to create new job placements for 16 to 24-year-olds on Universal Credit
  • Covers 100% of the National Minimum Wage (or the National Living Wage) for 25 hours a week for a total of six months
  • Also covers National Insurance contributions
  • Employers can spread the start date of the job placements until the end of December 2021

More information can be found here.

Government to Boost Support for Northern Ireland Agri-Food Traders

Traders moving agri-food from Great Britain to Northern Ireland will benefit from increased government support until the end of 2023 through the Movement Assistance Scheme. Under this scheme, certain certification costs will be covered when moving agri-food products.

Aside from being extended to the end of December 2023, it will also be expanded to cover costs related to:

  • scrapies testing for sheep exports
  • sample testing and certification required for individual seed lots from 1 August
  • the Plant Health Exports Audited Trader Scheme (PHEATS)
  • exporters in Great Britain who move organics solely to Northern Ireland, and Northern Irish importers who face new costs to receive these goods from Great Britain

5 Ways to Encourage Word of Mouth for Your Small Business

In a global study by Nielsen, 92% of people trust recommendations from family and friends, while 88% of people trust online customer reviews even if they’re from strangers. For many small businesses, word of mouth is the foundational layer of their marketing strategy. This Forbes article discusses different ways to encourage word of mouth from your customers.

  1. Nurture a relationship with your first customers.
    Nurture a personal relationship with your early adopters– this will make them feel much more invested in your products or services. If they feel their feedback and opinions are valued, they will be more likely to share their experience. Although you can’t personally talk to each customer as you grow, doing this will create the first wave of brand advocates.
  2. Establish a referral program to offer an incentive.
    A referral program can be the most effective way to convert happy but passive customers into active promoters.
  3. User-generated content.
    This is a powerful tactic as people are more likely to share something they personally created. For example, you could run contests rewarding customers who have the best pictures with your product.
  4. Encourage user reviews and be responsive.
    Encourage customers to leave reviews and actively engage in each one, especially during the early stages of your business. If there are criticisms, addressing them properly can also add credibility to your company.
  5. Use influencer marketing.
    People with a loyal following that has an overlap with your target market can help you grow your brand’s presence. Many small businesses won’t have a huge promotional budget, so micro-influencers may give you the most bang for your buck.

Always keep in mind that in order to successfully turn your customers into promoters, you need to deliver products and services that truly add value to people’s lives. If you’re looking for specific tips on how to grow your small business, book a consultation with our advisors today.

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