Four in five small businesses say coronavirus impact will last for next year

Four in five small businesses say coronavirus impact will last for next year
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More than four-fifths of small U.S. businesses said they expect the coronavirus pandemic to affect them for at least another 12 months, according to a survey from global payments network Veem.

The San Francisco-based company found that of 690 companies surveyed, 65 percent have applied for federal aid under the Paycheck Protection Program (PPP) or plan to in the near future. Veem helped thousands of small businesses apply for loans under the program.

Nearly 70 percent of respondents said they were uncertain about the state of the U.S. economy this year, and 55 percent said their revenues had already taken a significant hit.

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About 30 percent of the companies were less apprehensive about the situation, which CEO Marwan Forzley said likely reflected the industries that have seen increased business during the pandemic, such as online retailers.

“When you look at the data, there’s surprising resiliency with these small and mid-sized businesses,” Forzley told Reuters. “Despite all the uncertainty, they’re trying to make changes in their businesses, to ... either benefit from the situation or repurpose their business so that they’re not as badly impacted.”

A majority of the respondents said factory shutdowns, furloughs and border restrictions have disrupted supply chains, and more than one in three said they are in the process of developing regional supply chains or making changes to their existing ones to stay properly stocked. Nearly 25 percent said they have recently invested in new technology.

A slight majority, 52 percent, said they have cut operational costs, and another 59 percent said they have applied for loans. Only 13 percent of respondents said they have made no preparations for an economic slowdown.

More than half of companies said they plan to freeze hiring and another 23 were actively downsizing, while nearly 18 percent said they intend to increase staff support and training, according to the survey.