BUSINESS IMPACT SURVEY REFLECTS CONSUMER CAUTION
Article Date: 2020-05-29
FPA business impact tracking survey reflects consumer caution
The third iteration of the FPA Business Impact Survey reveals deeper economic impact and concern that consumer caution could hold back any recovery for longer, however the FPA hopes these figures are as bad as it’s going to get.
At this stage, 92% of members are selling less than pre-pandemic, up from 77% in the first survey six weeks ago. Some 90% of businesses have furloughed staff, up from 70% and 74% respectively and 5% have releases staff. Although half of member believe they will survive, this is with increase strain on the business. 49% say they will survive but with a much-reduced business; 36% believe they will survive intact and 20% will survive but with increased borrowings. Payment of invoice is still an issue with 80% reporting this a problem and just 26% anticipating that this will get better.
A new question was added to assess the reaction to the Prime Minister’s statement of plans to ease lockdown, with 44% of members hopeful this will bring an increase in demand in the third quarter.
Executive Director Martin Kersh said: “With the prospect of the hospitality sector reopening we very much hope these figures are as bad as it is going to get. With rumours of a reopening of hospitality sooner than expected with the possibility of social distancing being reduced to 1.5m or even 1m, pavement space being widened to enable more outside dining and consideration being given to extending opening hours, there is hope for the longer term. In the shorter term any optimism must be tempered by a reduced public confidence in going out alongside a reduction in the number of office worker commuting to their workplaces with office-based businesses reviewing their working practices. We also have to factor in the amount of packaging already in the supply chain so anticipate there will be a lag in demand following the reopening of the hospitality sector and so it will take more time for foodservice packaging to return to pre-pandemic trading. It is therefore vital the support given to the hospitality sector is applied to its supply chain. Continuing the furlough scheme is felt by FPA members to be the most effective support government can offer but we should seek greater flexibility as recovery will not be smooth so an option to employ say for three days and furlough for two would give businesses the ability to meet customer demands and stay in business”.