Te Awamutu Chamber of Commerce chairperson Chantelle Good fears that over half of New Zealand businesses will take a major hit from the enforced COVID-19 shutdown.
Businesses that are either relatively new, or who carry large debt, may not survive, she warned.
“This is huge for the sector. I would say that some businesses will certainly go under,” she said.
“I think 50 percent or more of New Zealand businesses will come out of this either with more debt, or not come out at all. There will be a number of businesses who have enough cash flow to cover themselves through this period, but realistically not that many. Generally speaking, most everyday businesses will struggle.”
Chantelle, who is into her second term in the chair, said while the wage subsidies offered by the Government were immensely helpful and could meet the needs in sectors such as accommodation and hospitality, it was likely it wouldn’t be sufficient to cover wages for trades and those in professional services.
“Employers will have to try and top up those wages, all the while trying to meet
their ongoing expenses at a time when they are likely to have no income. If people can borrow, they may well survive, but businesses with a lot of debt, of those who are relatively new, may go under – and they may not be able to start up again when all this is over.”
Some businesses could do well out of it, she suggested, citing an Auckland-based software app developer who was working on an app for online teaching. “That will go off now.”
The Chamber has been receiving calls from people seeking information about the shutdown, principally around how they can access the wage subsidies. Chantelle said members had already been emailed with whatever information was available and that form of contact would be continued as more information came to light.
“We are effectively continuing to operate remotely – which is what we have been doing largely anyway,” she said.
“There was a lot of panic following the announcement, and no doubt more questions will come out as it all sinks in. We will be available online to answer any questions people may have.”
The Chamber and will continue to work remotely.
A workshop originally planned for April would be run as a webinar, and depending on the support given to that, other scheduled workshops would move to that platform, Chantelle said.
She suggested that anyone with questions should contact the Chamber’s CEO Kris Anderson on 07-871 8125, or 021 247 0702.