A new survey of Auckland businesses paints a stark picture of the financial stress they are under.
The Auckland Business Chamber survey shows around 90 per cent of small and medium business owners have experienced significant erosion in equity.
More than 20 per cent said they did not expect their firms to survive this period of lockdown and restricted trading.
Almost 50 per cent said they had lost in excess of $100,000, and 75 per cent were funding the losses and daily operations by extending mortgages or using personal savings.
Chamber chief executive Michael Barnett described the results as “ugly”.
“This is significant and distressing for business owners,” he said.
“They have invested their lives in creating a viable business that feeds them, their staff and community. For many, this endless lockdown will have diluted retirement funds and imposed debt on family homes that previously wasn’t there.”
The Auckland Business chamber has around 4000 members.
Barnett said the initial response from around 1000 was received within hours of sending out the survey.
More than 20 per cent of the respondents said that, given the financial impact of 10 weeks in lockdown plus the cost of the Christmas/New Year period, the did not expect their business to survive.
Barnett said he took heart that 80 per cent were holding on.
“Despite it all, 80 per cent of businesses say they are determined to survive but will carry mental health scars that have damaged families and relationships and their confidence,” he said.
“The hope will be that Government will come up with the pathway that will lead to a better future when they release their plans.”
Tomorrow the Government is due to release more details around the plan to reopen the economy and deliver more specific support for businesses struggling to cope at alert level 3.
Barnett said business needed specifics of a recovery plan with professional business support, mentoring, health and wellbeing backup and legal support to mandate vaccinations for employees.
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