Haslemere Business Barometer – Covid Special

Welcome to this special report of the Haslemere Business Barometer, a survey undertaken in June 2020 to assess the confidence of Haslemere’s local business community as we start to come out of COVID lockdown.

The results show that while most local businesses were badly hit by lockdown, with over half losing 80% or more of their income, some have seen sales grow.  In the short-term, sentiment is split with concerns revolving around the difficulties posed by working, meeting or gathering in groups while observing social distancing, ensuring that customers and staff feel safe, or lack of market demand.

In the longer-term, businesses are more optimistic and see opportunities to build on new services and skills developed during lockdown, but many are concerned about the impact of a recession.  These results reflect much of what the Chamber is hearing from our members and contacts on a day-to-day basis.

As we publish this report, the UK is emerging from a period of lockdown and into the economic and social landscape of what has been termed ‘the new normal’. While many of our freedoms have, at present, returned they have come at a price. The mandatory wearing of face-coverings for shopping would have been unthinkable six months ago, but will be a reality from the 24th July. The Chancellor’s Summer Statement announced a £30bn stimulus package for the economy but it is clear that the UK, as with many countries across the world, is entering a period of recession. While none of us can predict the future, Haslemere’s businesses are continuing to show resilience, innovation and pragmatism. The support of our local community will be vital in helping them to weather the storm and we are grateful to them for the loyalty they are showing at the current time.

We are very grateful to everyone who took the time to complete the survey and would urge as many people as possible to fill in the next one – we need to know what you think in order to make strong representation on your behalf.

Craig McGowan, President of the Haslemere & District Chamber of Trade & Commerce

Executive Summary

This survey reflects the views of Haslemere’s local business community as we started to come out of COVID lockdown.   It paints a picture consistent with what has happened across the UK:

  • Most business have been hit hard during lockdown with nearly half of respondents seeing revenues fall by 80% or more. A quarter had no sales revenue at all during lockdown.  A few have benefited;
  • Short-term optimism on recovery from lockdown varies widely; 25% are pessimistic to some extent, 35% neutral or uncertain; and 40% are optimistic to some extent. While a few see no challenges as lockdown is relaxed, most concerns revolve around the difficulties posed by working, meeting or gathering in groups while observing social distancing, ensuring that customers and staff feel safe or lack of demand;
  • On average businesses are more optimistic about their longer-term prospects than the short-term. Over half are optimistic to a lesser or greater extent and for some business is booming.  The majority, even those who are optimistic, see a wide variety of longer-term challenges; the biggest concern by far (50% of respondents) is around the possibility of recession, lack of business investment and falling consumer spending;
  • Several see opportunities arising from the growth in home working and innovations introduced during lockdown such as online ordering and local deliveries.

Thirty-four businesses operating within five miles of Haslemere town centre completed the survey between 9 June and 2 July 2020.

The effects of Lockdown and easing of restrictions vary widely

Most business have been hit hard during lockdown.  While nearly half of respondents saw revenues fall by 80% or more.  A quarter had no sales revenue at all during lockdown.  As expected, hardest hit were businesses in:

  • Arts, Entertainment & Recreation;
  • Accommodation & food services;
  • Retail;
  • Health;
  • Beauty salons.

For some, lockdown has been good for business with 15% reporting an increase in revenue.  Those to have benefited include:

  • Professional services (accounting, financial and insurance)
  • Home improvements
  • Design and print services/ Acrylic screens

However, the picture is not simply one based on business sector; the impact on Information & Communications businesses depends very much on the markets they serve.

Short-term optimism on recovery from lockdown varies widely

On balance slightly more Haslemere businesses are optimistic about their prospects over the next three months than are pessimistic (average score = 3.1).

However, there is a wide range of views:

  • 25% are pessimistic to some extent;
  • 35% neutral or uncertain;
  • 40% are optimistic to some extent;

While a few see no challenges as lockdown is relaxed, most concerns revolve around:

  • The difficulties posed by working, meeting or gathering in groups while observing social distancing and minimising infection risks (“trying to keep compliant as we work on client sites as well as our own“, “running anything public-facing, such as events, consultations, focus groups”;
  • Ensuring that customers and staff feel safe while still delivering a positive and customer experience and employment (“Convincing customers that it’s safe to visit”, “Ensuring the workplace is safe and staff are comfortable in it”);

A lack of demand either from individual customers or other businesses (“There just is no business out there. Clients are telling us to get back in touch in 2021.”, “Encouraging customers to shop local”)

Longer-term optimism is tempered by the threat of recession and other challenges

On average businesses are more optimistic about their longer-term prospects (average score = 3.5) than the short-term.  Over half are optimistic to a lesser or greater extent.

For some, business is booming, and they see few challenges and expect only to be constrained by the capacity of their supply chain or ability to take on staff.

The most pessimistic are reliant on other businesses for income, have seen that dry up and do not expect it to return soon.  Two are considering shutting down.

The majority, even those who are optimistic, see a wide variety of longer-term challenges:

  • The biggest area of concern by far (50% of respondents) is around the possibility of recession, lack of business investment and falling consumer spending (“Large numbers of businesses going under so causing bad debts and reduction in overall economic activity”, “Lack of funding for long-term, strategic, transformational work”, “Whether people are still willing to spend money as the recession hits.”)
  • B2B businesses reliant on industries particularly hard hit by lockdown such as entertainment and leisure, culture, food & accommodation, and travel will have to adapt to new ways of working while giving customers confidence to return
  • For these and others “confidence is the key”, mixed with a recognition that new customers and services may be essential (“Confidence of the customer to return. We may need to look at new customers to use [our facility] during the day if the existing ones feel that they cannot return.”)
  • Others mention the need to build cash-flow, the importance of clarity in government guidance and the need to survive a slow recovery (“It will be slow to recover. Survival being the most challenging thing!”)

Several see opportunities amongst the post-COVID challenges arising from the growth in home working and innovations introduced during lockdown:

  • “finding ways to leverage our new online channels; (some) will now see that there is a friendly, local and responsive alternative to A****n”
  • “more people spending more time in Haslemere has been great”
  • people might want to support local businesses more because we have been able to help them during lockdown”
  • “new ways of working, lower cost base, more flexible working, higher margins”.

The Survey participants

There were 34 responses to the COVID-Special survey between 9 June and 2 July 2020.  A large majority were micro -independent businesses with 1-9 members of staff.

The largest sectors in the sample of respondents are Other (including Education and Financial & Insurance) (9), Retail (7), Information & Communications (6), and Professional, scientific and technical (4).

Geographic location is dominated by Haslemere (23) with seven businesses based within five miles of the town centre, and four from Weyhill/ Shottermill.

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