The majority (90 per cent) of businesses are awaiting to be paid an average of £148,917 for pre-lockdown work, MarketFinance has revealed.
A survey from the fintech business lender found that the vast majority of businesses (81 per cent) are also expecting to wait longer to be paid for the goods they provide and work they do from now on.
Half anticipate waiting anywhere between 14 to 30 days beyond normal terms (45 days), whilst 15 per cent reported they could be waiting anywhere between three to six months longer to be paid for work.
Only 43 per cent of businesses that applied for a coronavirus business interruption loan scheme (CBILS) loan were successful in securing it. The typical loan taken by these businesses was £211,667, though they applied for almost double this amount.
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“The reopening of the UK’s high streets marked the first buoyant moment for UK businesses in months but it might well be the calm before the storm,” said Anil Stocker, chief executive at MarketFinance.
“Businesses are facing a three-pronged assault on their finances.
“First up, its alarming that only half of their CBILS loans are being granted, then we learn that they have close to £150,000 in outstanding payments since the lockdown began and now, it’s likely that they will have to wait twice as long to get paid for new work they do whilst demand and economic activity normalises.
“This coupled with a very moderate outlook for trading conditions, ‘rent quarter day’ this week and uncertainty about their workforce, no doubt this will put further pressure on businesses.
“Given the continuing uncertainty around how the country returns to ‘business as usual’, I would urge business owners to look beyond their banks and seek advice as soon as from other lenders, business advisers and mentors.
“The earlier they do this, the wider the range of potential solutions they’ll have open to them.”
As the lockdown has eased and shoppers return to the high streets, almost half (45 per cent) of businesses are optimistic that there is pent-up demand for their products and services which they are eager to serve.
However, most only expect a conservative 10 per cent increase in sales over the next three to four months. A fifth (19 per cent) anticipate a 25-50 per cent increase in sales whilst one in six (15 per cent) expect a drop in sales of more than 75 per cent.
In March, the majority (56 per cent) felt business would normalise by September 2020.
However, now 57 per cent feel it could take as long as one to two years to return to normality and are planning for this.