OPINION: Survival is now the goal for many businesses hammered by coronavirus impact
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Unprecedented levels of financial support from both the UK and Scottish governments have kept numerous businesses afloat during this crisis.
However, this cannot last forever, and many firms in Ross-shire must start earning serious money soon if they are to survive until next year.
Cars cannot go from nought to 60 instantly, and neither can economies - it takes time, and time is something that few businesses have.
Take tourism, a mainstay of Ross-shire's economy. Reopening means businesses doing everything possible to ensure that customers' expectations will be met, and protecting staff and customers from the virus must now be added to the long checklist. For many, this means increased costs, reduced margins - even losses - and, possibly, redundancies. But it's not just about preparation; businesses need customers too.
Over the past three weeks we have seen the welcome return to the Highlands of UK residents seeking to relax and get away from it all, while enjoying the world-class things to see and do that our region boasts. However, the return has not been uniform, and businesses with rapid turnovers in customers like hotels and B&Bs have found the market sluggish, reflecting both nervousness amongst domestic consumers about mingling with others and the absence of overseas visitors.
This is why it is so important for us to keep our collective eye on the business survival ball. Yes, the future shape of the country is important, but right now the priority is survival. The more businesses that die over the next nine months the more unemployment will rise, the more our quality of life will deteriorate, and the more people, and especially young people, will leave Ross-shire. We must not lose the economic and social gains of recent decades.
For our part, FSB Scotland would like to see a new loan fund, resembling the student loan scheme, created for businesses. The money would be lent, not granted, but the affordable payback period would run for many years. We would also like to see demand in the economy being stimulated by all arms of the public sector to encourage people to shop local - wherever that may be. Spending locally does far more good for our communities than shopping online with big businesses or from large supermarkets. Indeed, every pound spent with local SMEs generates an additional 64 pence of spend for the local economy, but only 40 pence if spent with large businesses. Keeping Trade Local matters!
One golden opportunity already with us is the UK Government's six month VAT reduction. For a whole host of reasons, not least remoteness and seasonality, Highland holidays tend to be more expensive than those in competitor European countries. Add the fact that visitors here pay VAT at 20 per cent on almost everything, while those in Europe generally pay only 7 per cent to 10 per cent VAT on hospitality, and you have one obvious reason why Continental holidays appear so alluring to the British - cost. Clearly, a business's top priority is to keep itself solvent, and some will use the saving to do just that, but let's hope that most use this opportunity to stimulate visitor demand by passing the benefit on to their customers through reduced prices. If we hope to persuade the UK Government that it should continue the VAT reduction for tourism after January, we must first prove that it works.
David Richardson is the Highland development manager for the Federation of Small Businesses.
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