08 Apr 2020

Four in every five SMEs substantially impacted by COVID-19 crisis!

The “Survey on Impact of COVID-19 on Enterprises and Needs” conducted by Business for Goals Platform (B4G) in coordination with TÜRKONFED, TÜSİAD and UNDP reveals impact of coronavirus pandemic on enterprises. According to the survey responded by 780 enterprises from 47 provinces representing all the seven regions of Turkey, 36% of micro- and small-scale companies have suspended their activities. While the rate of companies whose revenue fell by more than half exceeds 50%, this rate reaches 71% in Southeastern Anatolia region. Only 3% of respondents stated that they were not impacted at all. According to the survey, top three expectations of SMEs in the fight with coronavirus include postponement of payment of bills/taxes/social security contributions (80%), tax discounts (77%) followed by financial support (71%).

 

In addition to causing a global health crisis, Coronavirus (Covid-19) pandemic impacts economy seriously. At a time when enterprises from many sectors all around the world decide to interrupt or slow down their operations, Business for Goals Platform organized a survey to identify impact of the pandemic on enterprises in Turkey. The “Survey on Impact of COVID-19 on Enterprises and Needs” conducted in coordination with TÜRKONFED, TÜSİAD and UNDP was responded by 780 enterprises from 47 provinces representing all the seven regions of Turkey. In an attempt to find out predictions of enterprises about evolution of the crisis and the kind of measures they need, the survey reveals the economic impact of coronavirus pandemic in a striking manner.

Coronavirus impacts small businesses hardest

Among the respondents in the online survey held on 23-27 March 2020, 62% stated that they were substantially impacted by the coronavirus pandemic while only 3% stated that they were not impacted at all. 11% of large companies, and 36% of micro- and small-scale companies decided to interrupt their operations. Only 8% of all the enterprises stated that their business is going as usual without shifting to crisis management while 32% stated that they partially started crisis management, and another 29% having started crisis management intensively.

Revenues down by more than 50%

According to the survey, revenues of more than half of the companies decreased by more than 50% with striking regional disparities. 71% of companies in Southeastern Anatolia region mentioned their revenue decrease by more than a half, followed by Eastern Anatolia at 63%, Eastern Black Sea at 62% and Mediterranean at 61%. Istanbul where 48% of companies stated that their business volume decreased by more than half reflects the national average. With 32%, Western Anatolia attracts attention as the least-impacted region.

Companies review their plans for 2020

There is no consensus among respondents of the B4G survey as to how long the crisis will last. 29% of enterprises estimate the coronavirus pandemic to impact second quarter of the year while 18% predicts impact of the pandemic to extend to fourth quarter.

Considering the coronavirus pandemic as a serious threat, enterprises review their strategies accordingly. 79% of respondents state that they are reviewing their strategies and activities for the year 2020. On the other hand, 34% of respondents point out that their enterprise does not have a business continuity or contingency plan. 95% of companies said that they took measures against the crisis, with improvement of hygiene conditions as the top measure taken by 85% of the companies.

Responses to the question “Is the information you obtained about Coronavirus crisis sufficient for you to make plans and to carry out crisis management?” indicate that enterprises do not have access to correct and reliable information. 24% of enterprises say that their information is sufficient while 35% responded “no”, and 41% “not sure”.

Enterprises unable to say “Stay at home!” to their employees and lacking access to digital means are in distress

51% of respondents state that infrastructure and digital means of their enterprise are not adequate for telecommuting. This rate is 52% in Istanbul, 40% in Aegean, 26% in Mediterranean, and 16% in Southeastern Anatolia. 70% of large companies make it possible to telecommute while only 32% of small companies can. This rate is 45% among companies in services sector, while it is 34% in manufacturing sector and 29% in trade/retail sector. Leaving aside sector-specific conditions, these figures mean that while part of the business world has made considerable progress in digitalization, the major part of it needs knowledge transfer as much as financial resources for digital transformation.

Top three expectations of SMEs: Postponement, discount and support

Covering economic impact of coronavirus, the survey asked participants about their expectations and requests. Accordingly, 80% of respondents point out that they need their bill/tax/social security contribution payments to be postponed and another 77% need tax discounts. Financial support to SMEs, postponement of repayment of loan, cheque and commercial debts are among other measures requested by most of the companies. In addition, 26% of respondents point to needs for psycho-social support for employees, 24% to medical and protective equipment support.

Figures on Respondents to the Survey on Impact of COVID-19 on Enterprises and Needs

  • 780 enterprises from 47 provinces representing all the seven regions of Turkey participated in the survey.
  • Among the respondents, 69% are micro- and small-scale companies, 20% medium-, and 11% large-scale companies.
  • 43% of respondents are in production/manufacturing, 37% in services, 20% in trade/retail sectors.
  • Companies in construction, food and beverages, textiles and apparel make up of 33% of all respondents.

Click here for Report on the results of the “Survey on Impact of COVID-19 on Enterprises and Needs”.

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