Despite the crisis, in 2020 small and medium-sized businesses (SMEs), including individual entrepreneurs, brought 612 billion rubles to the Moscow budget, that is, almost a quarter of all city revenues. This is 7% more than in 2019. According to the official portal of the mayor and the government of the capital, over the past 10 years, the share of small and medium-sized businesses in the budget of the capital has more than doubled.
Nevertheless, on a national scale, small and medium-sized businesses in 2020 suffered serious losses and turned out to be one of the most affected areas. According to experts from the Center for Strategic Research (CSR), the number of workers employed in SMEs in 2020 has decreased by more than a million people.
Most of the restrictions during the pandemic affected enterprises in the service sector, catering, trade, tourism and entertainment, where the share of small and medium-sized businesses is traditionally high. Although at the end of the year, many were able to adapt to the new reality through digitalization and the development of delivery. On the other hand, budget revenues from entities engaged in the field of information technology, consulting and scientific activities, as well as the manufacturing industry have noticeably increased.
According to media reports, the government is now considering a new package of measures to support business, the approximate cost of which is 200 billion rubles. It includes measures such as loans at a zero rate on salaries, cancellation of tax debts to enterprises from non-recovered industries, subsidizing loans to small and medium-sized businesses when hiring new staff, and simplifying the transition of companies to a common tax regime. True, when the package will be approved and in what volume is still unknown, since the relevant departments are only working out the proposal.
About how small and medium-sized enterprises will overcome the consequences of the pandemic in 2021, whether everyone will be able to adapt to the new realities and whether government support measures are enough for SMEs “Free press spoke with CEO and co-founder of SimpleFinance, which deals with lending to small and medium-sized businesses, Alexei Basenko.
“SP”: – 2020 turned out to be very difficult for the entire economy, but especially for small and medium-sized businesses. According to some reports, every fifth enterprise was closed during the year. Is this how badly the sphere suffered?
– Now it is difficult to summarize, but when all the restrictions and support measures imposed by the government are lifted, apparently, 20% -25% of small and medium-sized businesses from the most affected segments will not resume work. However, the lockdown did not bring negative consequences in all areas of business. For example, companies working in the field of public procurement are doing quite well, and e-commerce merchants, whom we are actively lending, have significantly increased sales in 2020.
“SP”: – Who suffered the most?
– Such enterprises, for example, include travel companies and hotel facilities, businesses related to the service sector – bars, restaurants, karaoke, clubs and so on. The share of bankruptcies and current players leaving the business can be significant in this sector.
“SP”: – So far, the country has a moratorium on bankruptcy. What will happen when it is canceled, will a wave of bankruptcies of enterprises and their counterparties await us, will this not lead to a crisis?
– It is unlikely that this will lead to a new round of the crisis. And here everything also depends on the field of activity we are talking about. For example, the share of lending to SMEs in the portfolio of banks is not too large, therefore, the reduction in the number of SMEs is not significant enough for them to lead to a crisis in the banking system.
Ultimately, bankruptcy is the inability to pay obligations. And if, for example, the business could no longer survive the pandemic and left the race, lifting the moratorium on bankruptcy will not change anything, but will simply make it possible to state the fact of the closure of a number of companies.
“SP”: – What steps should be taken to support small and medium-sized businesses? Does the business community have any suggestions? Can we use the western experience of supporting the industry?
– If by the Western experience of support we mean the provision of a large amount of liquidity to the economy by the state, then theoretically it is possible. However, there are no signs yet that we will have such support. In my opinion, the measures that have already been implemented are some of the final ones.
As for supporting small and medium-sized businesses as a whole, it seems to me that our economy needs systemic steps aimed at increasing the share of businesses not related to the state, qualitatively improving the investment climate and multiplying the venture capital market.
The business community has raised these topics on several occasions. I am sure that targeted actions need to be taken, including by business, because 2020 has shown that the previously considered effective business models, one way or another, are becoming a thing of the past. Building digital channels of business and communication, and ownership of customer information come to the fore. Without this knowledge, today it is no longer possible to produce a high-quality product and successfully sell it.
“SP”: – What are the prospects for small and medium-sized businesses in 2021?
– Taking into account the fact that vaccines against coronavirus have already appeared and the pandemic, apparently, is on the decline, already now we can assume that there will be no further lockdowns and tightening. This will allow companies to more accurately plan for 2021, which was very difficult to do in the uncertainty of 2020.
Therefore, this year there will be a rebound, especially in the affected industries – companies will show better results compared to 2020, new players will appear. In particular, the rapid development of the e-commerce market, which we saw during the pandemic, can become a strong driver for entrepreneurs who already now want to more widely present their products on the “shelves” of e-commerce sites.
“SP”: – How can businesses adapt to the new reality and can everyone do it?
– The experience of the past year has shown that the easiest way to adapt is to develop digital sales and communication channels. The product itself and its qualitative and quantitative characteristics are now of key importance, and not the supplier of this product.
Now, when all goods and services of different suppliers are on the same virtual shelves of transparent digital storefronts, the buyer has an even easier opportunity to compare and make his choice, this applies to both b2c and b2b spheres. Those companies that can make a good product relevant to the final user, quickly adapt their processes and are able to provide effective distribution channels will be able to quickly adapt to the new reality.