Quarter of Scots firms expand during pandemic
Businesses have adapted to new ways of working
Scottish businesses have been able to expand or adapt to new business models during the pandemic, indicating some ‘green shoots’ of recovery, according to research by Rathbone Investment Management.
Moving to new models, such as online sales, has had a positive impact with a quarter (26%) of business owners having expanded their business during the pandemic.
In addition, a further 16% of business owners set up their business during the last 12 months as the pandemic sparked new ideas and opportunities.
Businesses in Orkney and Shetland were the most likely to have expanded in the pandemic (33%), while Dundee, Perthshire and Angus had seen the highest numbers of newly created businesses (25%).
However, the pandemic has had significant implications for many businesses across Scotland, with four in ten (37%) reporting that they had suffered during the pandemic according to Rathbones’ research.
The ongoing social restrictions have forced large numbers of businesses to close over the last year, with businesses in retail, leisure and hospitality most impacted. Indeed, while a roadmap has been announced that spells out Scotland’s path out of lockdown, one year into the pandemic many businesses have seen significant losses in income.
Simon Dewar, regional director at Rathbones, comments: “The past twelve months have been difficult for businesses across Scotland with every organisation needing to adapt to some extent due to the pandemic.
“However, the impact has been disproportionate with some businesses severely financially impacted. While government support has gone some way to support these businesses throughout this period, its unlikely we’ll see a true recovery until restrictions are fully lifted.
“With the vaccine roll-out ongoing, many business owners will be holding their breath and hoping that this effort reaps dividends and we can stick to the timelines set out in the roadmap.
“It’s clear from our research that Scottish businesses are largely optimistic for the future, with a high proportion expecting a positive outlook for the economy in the next twelve months.
“As businesses start to recover from the initial impact of the pandemic putting a financial plan together to rebuild any safety net that may have been eroded away during this period will be key for business owners.
“Many businesses have deferred any expansion plans over the last year as the focus has been on survival. As confidence grows, so will the sparks of entrepreneurial endeavour, with businesses dusting down these plans and using what they have learned through the crisis to seize opportunity and build robust businesses that drive our economy.”