550,000 Small Businesses Shut Doors Due To Disruption Every Two Years
Destroyed stock and delivery vehicles breaking down are among the incidents that have caused the wheels come off some small businesses
Over 550,000 small businesses have been forced to temporality cease trading due to “disruption” in the last two years, according to Direct Line for Business.
The survey of 301 small business owners revealed that destroyed stock and delivery vehicles breaking down are among the incidents that have caused the wheels come off some small businesses.
Worryingly for enterprises, those forced to halt trading have been hit with hefty costs, with the average amount required to keep a business afloat, without trading for two weeks, estimated to be £8,775.
The average small business believes that it would last around eight months and three weeks if it were forced to halt trading, with sole traders (nine months, one week) faring better than microbusinesses – businesses employing fewer than 10 people – (nine months) and small businesses (six months, two weeks).
The most common consequence for small businesses being unable to trade was a reduction in profit (48%). This was followed by a reduction in revenue (42%), a loss of customers (39%) and business owners having to put their own personal cash into the business (32%).
Nick Breton, head of Direct Line for Business, said:
“There are many reasons a business might need to halt trading and unfortunately a lot of them are unforeseen.
“Keeping a business afloat when there is a disruption can be stressful enough, especially when there are no funds being generated.
“Business owners must ensure they have adequate insurance to minimise any disruption should an incident occur. Business interruption insurance covers your business if your insured property has been damaged resulting in a loss of income.”