While British Columbia has entered phase two of its Restart Plan, only one-in-four (26%) businesses impacted by COVID-19 feel able to restart and operate profitably with the gradual easing of restrictions.
The biggest challenges to restarting identified by survey respondents are:
- attracting customers or revenue (75%),
- having enough operating cash for expenses (49%) or to meet safety standards (31%),
- bringing staff back (39%),
- government not allowing their business to open yet (31%), and
- not yet prepared or able to meet safety guidelines (30%).
Given the challenges to restarting operations, over half of the members surveyed (55%) expect it will take at least two months to restart.
The findings are the results of a survey of 1,343 member-businesses of the BC Chamber of Commerce, Greater Vancouver Board of Trade, Business Council of British Columbia, and other partners, with the assistance of the Mustel Group. This survey is the third in a series of pulse checks using the BCMindReader.com platform.
The impacts on businesses from the COVID-19 pandemic are similar to previous surveys with the most common continuing to be decreased sales volume, reported by 78% of businesses. As businesses work hard to restart, fewer (45%, down from 67% reported in the second survey) expect decreased sales volumes in the next two weeks.
Organizations are increasingly innovating and seeking new ways to access customers with 31% noting they have increased their digital or e-commerce presence. However, 43% of businesses expect that they will still require significant financial support or incentives from the provincial and federal government, beyond those already announced, in order to continue operating.
Other Key Findings
Government programs have helped bridge the gap and remain critical for business survival.
Commercial Rental Assistance (CECRA)
- Among businesses paying rent, 26% were unable to pay their rent in full in April. The primary reason is that they were shut down and had no revenue (75%). Others had no access to the CECRA program (30%) or could not come to terms with their landlord (19%).
- Only 16% of businesses paying rent expect to qualify the CECRA; another 27% are unsure. For organizations that expect to qualify, only 40% expect their landlord will apply for the program.
Emergency Wage Subsidy (CEWS)
- While nearly 80% have noted declines in revenues, only one-third of businesses, 34%, expect to or have applied for CEWS, another 11% may apply.
- Half of those currently using the program are not sure what they will do when the program ends, but 30% expect to have to lay off employees and only one-in-five (18%) expect to return to business as usual (note the extension to the program was announced prior to the launch of the survey).
Additional Government Supports
- 43% of businesses expect that they will require significant financial support or incentives from the provincial and federal government, beyond those already announced, in order to continue operating.
- Extending CEWS is the most needed program (47%) in addition to enhancing the Emergency Business loan (34%), extending the rental assistance program beyond June (26%), and providing funding for growing e-commerce or other products/services (29%).
Ease of Application Process
- Among those who have applied for government assistance programs, one-third of those with an opinion found the process difficult.
Impacts on business
- Between 32% to 40% have had capital projects, contracts/tenders and/or marketing projects either cancelled or deferred (similar to previous surveys).
- Among those laying off staff, on average businesses have laid off 12 employees which is less than the 25 reported in the second survey, and 43 employees reported in the first survey. This likely reflects the uptake of the wage subsidy program and return of some laid off employees.
- 31% have increased their digital or e-commerce presence, and small groups have introduced new products or services (11%), advanced new marketing projects (8%) or advanced new research and development (5%).
- In terms of businesses that have closed temporarily, the level is slightly higher in urban markets (50%) than in rural (42%), with the incidence highest in the following sectors: healthcare and social assistance – 74%, arts and entertainment – 77%, accommodation and food services – 68%, and retail – 58%.
“This crisis isn’t over for BC businesses. You can go out of business much faster with a partial or failed reopen than you can a temporary closure. Policy-makers must appreciate that business models will be very fragile during this early stage of the recovery cycle and that ongoing supports will be essential.” Val Litwin, President & CEO, BC Chamber of Commerce
“Government support remains vital as businesses work intently on reopening plans and put in place measures to follow the health and safety guidelines. The coming weeks and months will be critical as the bills continue to pile up, and businesses face additional costs to reopen on top of worrying about having the employees, inventory, and ultimately whether their customers will return.” Bridgitte Anderson, President & CEO, Greater Vancouver Board of Trade
“The most recent survey data shows virtually all respondents continue to experience lost revenue as a result of COVID-19 and restart efforts will be hampered by an inability to attract new and returning customers. We are facing a global recession and the worst year for B.C.’s economy and job market in a century. Against these stark realities, governments need to single mindedly turn their attention to the tools at their disposal to expedite economic activity and address competitiveness barriers in the form of tax, regulatory and process costs that stand in the way of businesses re-hiring the nearly 400,000 employees who’ve lost their jobs.” Greg D’Avignon, President & CEO, Business Council of British Columbia
About the BC Chamber:
The BC Chamber of Commerce is BC’s largest and most broadly-based business organization–representing more than 125 Chambers of Commerce and Boards of Trade with a network comprising 36,000 businesses of every size, and from every sector and region of the province.
About the Greater Vancouver Board of Trade:
Since its inception in 1887, the Greater Vancouver Board of Trade has been recognized as Pacific Canada’s leading business association, engaging members to impact public policy at all levels of government and to succeed and prosper in the global economy. With a Membership whose employees comprise one-third of B.C.’s workforce, we are the largest business association between Victoria and Toronto. We leverage this collective strength, facilitating networking opportunities, and providing professional development through four unique Signature Programs. In addition, we operate one of the largest events programs in the country, providing a platform for national and international thought leaders to enlighten B.C.’s business leaders.
About the Business Council of British Columbia
Now in its 54th year as the premier business organization in British Columbia, the Business Council of B.C. is a non-partisan organization made up of 250 leading and largest companies, post-secondary institutions and industry organizations from across B.C.’s diverse economy. The Council produces exceptional public policy research and advocacy in support of creating a competitive economy for the benefit of all British Columbians.
Director of Communications, BC Chamber of Commerce