Businesses' revenues over the next three months will be 50 per cent lower than expected, on average, according to a survey by Chambers Ireland. A significant number expect a larger decline.
Smaller companies have suffered most and invoice arrears are increasing sharply. Clarity was urgently needed on a dramatically expanded range of government supports, according to Chambers Ireland, which is the umbrella body for the chambers of commerce movement, representing mainly SMEs all over the State.
The survey of 1,320 companies was taken from May 28th to June 2nd. It shows a small improvement in sentiment from the previous survey, reflecting the reopening of some sectors. However the general mood remains bleak and 25 per cent of firms expected revenue to be down at least 70 per cent over the next three months.
Those that did reopen in phase one, including construction firms and outdoor retailers, reported business and employment levels well below normal.
Looking at turnover for April and May, the average decline reported in the survey was 51 per cent, with smaller companies reporting falls averaging closer to 60 per cent.
Not surprisingly the biggest declines were in hospitality, where revenues were down 71 per cent, and tourism, down 89 per cent.
The survey also showed that late payment of invoices was a significant problem, with the value of unpaid invoices significantly increased, particularly in smaller firms,
"Our research clearly shows that the hard work of restarting our economy is only beginning," said Ian Talbot, Chambers Ireland chief executive.He said that "dramatic financial intervention" was needed to support SMEs and that certainty and clarity on longer -term supports was necessary so that businesses could plan. Support to improve liquidity and help with overheads was necessary, he said, including a rates waiver of at least a year, additional funding for local authorities, expanded grant aid and a targeted extension of the wage support scheme.