The UK Government is running a #ShopLocal week this week, as part of its #EnjoySummerSafely campaign. The week aims to celebrate the British high street – encouraging customers to come back to their safe local shops, supporting the local economy and local jobs.
A toolkit has been made available for busiensses to help with marketing the campaign. Access the toolkit here.
Results from the latest BCC Coronavirus Business Tracker reveal that business conditions improved only moderately in the weeks since the UK economy suffered an historic contraction in Q2 2020, with firms still reporting high levels of reliance on government support schemes to help stem cashflow issues.
The leading business organisation’s tracker survey, which serves as a barometer of the pandemic’s impact on businesses and the effectiveness of government support measures, received 502 responses during the week from 3rd to 7th August and is the largest independent survey of its kind in the UK.
The unprecedented decline in business conditions seen during the second quarter is now levelling off, but firms still face difficult trading conditions.
Mixed picture on revenue
The number of firms reporting a rise in revenue from UK customers rose to 38 per cent, from 34 per cent in the previous tracker and is up significantly from the series low of 3 per cent recorded during the second quarter. However, despite this progress, the number of respondents reporting a rise in UK revenue is still not exceeding the number reporting a decrease (also 38 per cent).
Business to consumer firms were more likely to report improvements in UK revenue compared to other sectors, although these gains are from a low base due to lockdown restrictions, later reopening, and pent-up consumer demand.
A smaller proportion of firms (22 per cent) are reporting a rise in revenue from overseas customers than from UK customers (38 per cent) amid continued disruption to global commerce and trade flows.
Cash concerns
While there was a slight improvement in the number of respondents reporting a decrease in their cash reserves (50 per cent compared to 55 per cent), it remains more than double the number reporting an increase (22 per cent). Despite the gradual reopening of the economy and more firms seeing a rise in revenue, 39% of businesses say they have three months or less worth of cash in reserve.
Of those reporting an increase in their cash reserves, a significant number of businesses cited government support schemes as a driver of this, with the number of firms using the furlough scheme (34 per cent) and the various loan schemes (30 per cent) and grant schemes (16 per cent) still significant. 68 per cent of firms mentioned new business or customer demand as a factor.
With government support schemes set to wind down in the coming weeks, and with the potential reintroduction of lockdowns – either localised or national – it remains unclear what further support, if any, firms will receive when schemes end.
Commenting on the results, BCC Director General Adam Marshall said:
“While some firms are seeing improvements in trading conditions, we are still very much in the eye of the storm, with further turbulence ahead.
“As the government’s emergency measures begin to wind down over the coming weeks, and with the prospect of further local lockdowns still very real, businesses across the UK are going to need further support to weather uncertainty over the coming months.
“Slashing the jobs tax by taking steps to reduce the burden of employers’ National Insurance contributions, big new incentives for business investment, and targeted support to help businesses placed under local lockdowns all need to be put in place now. Ministers must not wait until the economic storm is once again at fever pitch before they act.”
Commenting on the latest labour market figures, published today by the ONS, David Kern, Chief Economist at the British Chambers of Commerce said:
“The latest figures highlight the flexibility and resilience of the UK labour market. The growth in employment and fall in unemployment are stronger than a month ago and point to improved momentum in the economy after a weaker patch last year. It would not therefore be surprising if the ONS updates its preliminary 0.5% GDP figure for the fourth quarter of last year.
“One area of concern is that youth unemployment remains unchanged after a long period of steady declines. While youth unemployment remains much lower than a year ago, it is consistently higher than the adult employment rate, so we need to look at ways to bring this down further.
“It is positive that earnings are now increasing much faster than prices, however, it is important to remember that wage increases can only be sustainable if they are matched by increases in productivity. We must match the positive developments with the right policies, in order to support business confidence and help drive the economy forward.”
The Chambers Quarterly Economic Survey (QES), the UK’s largest independent business survey, is open today (Monday 24 August 2020) for three weeks.
With the UK officially in a recession and the impact from the phasing out of the furlough scheme starting to be felt, it is therefore more important than ever that both the Chancellor and the Bank of England hear from businesses just like yours.
How has your business performed in the last quarter, what do you see as the challenges and opportunities going forwards? How confident are you about your financial position, your workforce and your future orderbook?
Without this vital local and regional knowledge they cannot make the right decisions and put relevant support mechanisms in place that will ultimately impact on you and your company.
The QES is anonymous, open to anyone and only takes a couple of minutes to complete online.
We need your input, if you only take one survey, then please make it the QES
Join us as we launch our brand-new international trade country focus programme, in September 2020.
This exciting new programme brings together industry figures, government representatives and BCC partners from across the world. It will provide businesses with all the insights, advice and answers they need to fully understand the implications of trading with major international markets that have been identified as priority trading partners for the UK.
Each month will consist of two parts:
Part 1 – Global Leader Insights: a strategic overview
This will be a strategic discussion about current/future trade relations with a senior government representative from the market being featured, moderated by Dr Adam Marshall, BCC Director General.
Part 2 – Global Panel Insights: a deeper dive
A more in-depth discussion with leading local experts to allow participants to:
Together these two parts will give businesses a thorough understanding of the implications and benefits of trading in major overseas markets.
The programme schedule is as follows:
Please see links below for the September, USA month, virtual events:
‘Global Leader Insights: a strategic overview – The Future of UK-US Trade Relations’ on Thursday 10 September, 13:30 – 14:30
‘Global Panel Insights: a deep dive – Future industry sector opportunities in the context of a new technology-driven world’ on Tuesday 15 September, 16:00 – 17:00
Millions of self-employed people whose livelihoods have been affected by coronavirus are now able to claim a second payment of up to £6,570 – as the government continues to help drive the UK’s recovery.
Those eligible for the Self-Employment Income Support Scheme (SEISS) can now claim a second grant covering 70% of their average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits and capped at £6,570 in total, with the money set to land in their bank accounts within six working days of making a claim.
Anyone whose self-employed business has been adversely affected by coronavirus since 14 July 2020 is eligible for the scheme.
Chancellor of the Exchequer Rishi Sunak said:
“Our self employment income support scheme has already helped millions of hard working people, whose get up and go drive is crucial to our economy.”
“It means that people’s livelihoods across the country will remain protected as we continue our economic recovery – helping them get back on their feet as we return to normal.”
The eligibility criteria remains the same as for the first grant, with people needing to have had trading profits of no more than £50,000, making up at least half of their total income.
The SEISS is part of a comprehensive package of support for self-employed people, including Bounce Back loans, income tax deferrals, rental support, increased levels of Universal Credit, mortgage holidays and the various business support schemes the government has introduced to protect businesses during this time.
The Chancellor has also set out the government’s Plan for Jobs to support, protect and create jobs up and down the country – including in the construction and housing sectors through funding to decarbonise public sector buildings and our Green Homes Grant.
Guidance on how the grant works can be found here.
Businesses will be able to make their claim for the second and final grant at any time until the scheme closes on 19 October 2020.
It is 86 days to Brexit.
The UK Government has recently published a new Border Operating Model that will change the way in which goods are imported to and exported from the UK from 1st January 2021.
At present businesses have free movement of their goods into/out of Europe, however on 01 January 2021, you will need to produce international trade documentation for all your products both imported and exported to/from the EU. The upshot is that there will be a significant increase in costs for all businesses to process their goods into and out of the UK. The British Chambers Trade Facilitation Director recently wrote an article that highlighted that changes coming: https://www.norfolkchamber.co.uk/news/brexit/no-more-transition-uk-border
To ensure that your business is ready to meet the new import/export regulations on 01 January 2021, you need to have considered the following ten key areas:
Many of you will already have been allocated your EORI number, but click here for how to apply for an EORI number, if you don’t already have one.
You may already be using a freight forwarder and they will be able to offer you advice and support, alternatively Norfolk Chambers have the expertise to handle your customs declarations and stand ready to help support you in navigating the coming changes, please do ask us for more information.
Norfolk Chambers are running several international trade training courses that will help you and your team to understand and prepare for 01 January 2021: https://www.norfolkchamber.co.uk/training.
We have also teamed up with the British Chambers to deliver a series of Global Webinars that will also provide insight and knowledge into future international trade. The first two are scheduled for September:
You can find the whole series on our events page: https://www.norfolkchamber.co.uk/events
You will also need to ensure that you are fully aware of all your commodity/tariff codes relevant for all your products. Again, you may be using a freight forwarder and we would recommend that you discuss the above with them on an urgent basis. Alternatively, we would be very happy to help you.
You will need to declare all goods that you import/export to the EU. You will also need to arrange clearance of those goods for each port/airport. You may have freight forwarders in each location that can do this for you, alternatively, Norfolk Chambers can clear your goods at any port/airport in the UK on your behalf. We also have the ability make arrangements for you to use our deferment account if that is required.
Norfolk Chambers have the international trade expertise to ensure that you and your business are fully prepared and we are here to help you to navigate through the new regulations to make your Brexit transition as smooth as possible.
To talk to our specialist team and to find out more please contact export@norfolkchambers.co.uk or call 01603 729706.
Did you know many of our International Trade Training courses are eligible for HMRC funding?
If you’re a customs agent or your company uses agents and intermediaries to trade with the EU you need to understand how to meet customs requirements fast and efficiently after the end of the transition period.
HMRC has made record funding of £50 million available to enhance its Customs Grant Scheme. From 29 July 2020, organisations can apply for funding to reimburse a number of costs associated with increasing their capacity and enhancing their ability to complete customs declarations, ahead of the new rules from January 2021.
Businesses can apply for funding for recruitment, employee training and IT, in preparation for additional customs declarations. Eligible organisations include traders and customs intermediaries (such as customs brokers, fast parcel operators and freight forwarders) who make or intend to make customs declarations for their own goods or on behalf of others. Organisations which recruit, train and place apprentices into customs intermediaries or other organisations which undertake customs declarations activity are also eligible to apply.
All eligible organisations which are currently and have been based in, or with a branch in, the UK for at least a year can apply for all elements of the grant.
This funding can be used for the following courses:
All courses are available to book here and training is open to both members and non-members.
Members of the Norfolk Chambers of Commerce receive a significant discount on training costs.
For more information on how to claim for HMRC funding, click here.
Commenting on GDP figures for July 2020 published today by the ONS, BCC Head of Economics Suren Thiru said:
“The latest data confirms that UK economic activity continued to pick-up in July as lockdown restrictions eased further.
“The UK economy is currently in a period of temporary calm, with activity buoyed by the government’s emergency support measures and the unwinding of pent-up customer demand as more parts of the economy reopened.
“However, with many firms continuing to face an unprecedented cash crisis and unemployment likely to surge as the support schemes wind down, there remains little prospect of a sustained resurgence unless substantial action is taken.
“To protect jobs and livelihoods, the government should consider extending and adapting the Coronavirus Business Interruption Loan Scheme to ensure businesses are supported sustainably over a longer period, as well as introducing a more significant package of support for firms placed under local restrictions.”
At a recent meeting, members of Norwich Chamber Council heard from Karen O’Kane, Programme Director for Better Broadband for Norfolk (BBfN) and Annette Thorpe, the Regional Partnership Director for BT on the roll out of broadband across Norfolk. The aim of BBfN is to implement the necessary infrastructure to allow 90% of Norfolk to be able to access broadband by the end of 2017. With 84% coverage expected by the end of the first part of the contract at the end of 2015.
Step one is for businesses to find out if they already have access to better broadband or when they can expect it to be implemented in their area. They need to check on the BBfN website: www.betterbroadbandnorfolk.co.ukThis can be done by adding the postcode into the broadband checker on the top right hand side of the BBfN home page. This website also provides advice and links as to how to find out what your current upload and download speeds are.
If a business finds that they are not eligible or cannot access better broadband, they can send their contact details to Karen O’Kane, who will check whether that specific location is due to receive better broadband in the future and she may be able to advise the business of further steps they can take. Karen can be contacted on: karen.okane@norfolk.gov.uk
Businesses need to note that Broadband speeds will not automatically improve once the infrastructure has been implemented -businesses need to take further action:
Last week, the Government announced its Kickstart Scheme, a £2 billion fund to create hundreds of thousands of high quality six-month work placements aimed at those aged between 16 to 24, who are on Universal Credit and are deemed to be at risk of long term unemployment.
The funding available for each job will cover 100% of the relevant National Minimum Wage for 25 hours a week, plus the associated employer National Insurance contributions and employer minimum automatic enrolment contributions.
The Kickstart Scheme job placements must be:
Larger organisations, that can offer a minimum of 30 new placements, are being asked to apply directly to the scheme. More information is available here.
However, for those firms who are unable to offer such a large number placements, the Government is looking to work with intermediaries, such as Chambers of Commerce, to coordinate funding bids.
Commenting on the new scheme, Nova Fairbank, Head of Policy for Norfolk Chambers said:
“Norfolk Chambers and the UK Chamber network have been working with the British Chambers of Commerce Taskforce and the DWP to develop the Kickstart scheme.
“We therefore welcome the intention of the scheme, but are looking at the detail to ensure that it will indeed create the long-term, quality employment opportunities needed, by ensuring that both businesses and employees are fully supported throughout the placement.
“Norfolk Chambers are happy to support local businesses to access the Kickstart Scheme and we are in dialogue with various partners to explore ways of collaborating our efforts to make the application and delivery processes as easy as possible for businesses.”
If your business is interested in creating a fully funded placement for a young person, please contact: Nova.fairbank@norfolkchambers.co.uk and advise how many placements you are thinking of creating.
Commenting on the ONS labour market figures for September 2020, published today, BCC Head of Economics Suren Thiru said:
“Despite the slight rise in the unemployment rate, the furlough scheme continues to limit the pandemic’s full impact on headline job figures.
However, the decline in employees on payrolls and the rise in the claimant count in August as the furlough scheme began to taper is a clear warning that the full impact of Coronavirus on the UK labour market is yet to come.
“While there was a rise in the number of job vacancies, this is more likely to reflect a temporary bounce as the economy gradually opened, rather than a meaningful upturn in demand for labour. With many firms are still facing waves of cash flow problems, rising costs and an uncertain economic outlook, it is probable that unemployment will escalate sharply as government support winds down.
“To help avoid a damaging cliff edge for jobs more must be done help firms keep staff on through this deeply challenging period. This should include a significant cut in employer National Insurance Contributions and more substantial support for firms placed under local lockdowns.”