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Covid-19: More than one French SME out of two fears bankruptcy

Covid-19: More than one French SME out of two fears bankruptcy

According to a survey conducted by the Confederation of SMEsAccording to a survey carried out by the European Commission, more than one in two SME managers(55%) fear that their companywill go bankrupt as a result of Covid-19. 60% of the managers questioned have noted a drop of more than half of their turnover in March. Only 8% did not experience any loss of income. At the time of the survey, 65% of the responding SMEs were closed, 49% of them by administrative decision.

Worrying results for SMEs

The press release from the employers' organisation reveals that the difficulties of companies are aggravated by the fact that 39% of companies suffer from late payment. In fact, only 48% of companies say they can pay their invoices on time. Half of them have enough cash to cover between one and three months of operations, while more than a third have less than a month's worth of cash. Two out of three SMEs have approached their banker and 80% felt that they had received support from their banker. However, 76% said they had not been supported by their insurer.

Employees on short-time work

Few SMEs have business interruption insurance. The Covid-19 pandemic is not covered by insurance because the health disaster is not recognized as a natural disaster. Thus, 83% of the companies have recourse to partial unemploymentand 5% consider at the time of the survey to use this device. This allows the State to pay those who can no longer work while waiting for activity to resume. 41% of SMEs plan to use employees' paid holidays during the lockdown period. Finally, 51% say they have asked for tax deferrals and 18% plan to do so soon.

At Klack we help SMEs in difficulty by accompanying them in their digitalisation.

More than one French SME in two fears bankruptcy because of Covid-19

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