COVID 19 Business Supports

COVID – 19: Business Supports Update.

Local Enterprise Office Donegal

(27- 3- 2020)

We are now in the third week of the COVID virus pandemic and our businesses continue to struggle to sustain themselves. With almost all of our service and tourism outlets and service providers closed it is proving an extremely challenging time for all businesses.

Given the scale of the challenges facing businesses and their staff, we appreciate that the supports that we have are limited, but we will seek to respond as positively and as flexibly as we can to the challenges facing small businesses in Donegal during the current crisis.

As we have previously advised, for all businesses at this time the key challenge will be managing cash flow within the business, in particular if there is a major reduction in turnover or a decision is made to close the business until it is notified that it is safe to reopen. This may not yet be impacting on you but we know form our contact with businesses over the past week that it will very likely impact on your business within the next few weeks. Business owners should look at their fixed costs such as rent, loan repayments, insurance etc and evaluate what finance they need to cover these over the likely period of the COVID pandemic.

We strongly recommend that business owners prepare a monthly cash flow for the next 12 months incorporating a minimum emergency 3 month forecast to estimate how much cash the business will need in the short term. This should be kept simple and prudent in terms of sales projections. This will help you to:

  • Identify immediate financial priorities, and
  • Focus on identifying any short term quick “wins” thorough reducing costs and cutting unnecessary expense

It is critical that the business owner, on the back of this cash flow exercise, implements quick, rapid and timely measures to free up cash flow and stop the haemorrhaging of cash.

In this context we can now offer consultancy to the value of €2,500 under the COVID- 19 Business Continuity Scheme to any business under 50 employees see further info here: 

The aim of the scheme is to support businesses to make informed decisions on the immediate measures needed to continue trading in the current environment while securing the safety of all employees and future business viability through identification of remedial actions.

The Business Continuity Voucher is available to support businesses to:

 

               i.        Develop business continuity plan

             ii.        Assess current financial needs in the short term to medium term

            iii.        Reduce variable costs, overheads and expenses,

            iv.        Review and explore supply chain financing options

             v.        Implement remote working processes or procedures

            vi.        Leverage HR expertise

           vii.        Leverage ICT expertise

           viii.       Prepare a business case for application to emergency financial interventions available through Banks, Strategic Banking Corporation of Ireland and Micro Finance Ireland.

 

While this scheme along with the other national supports will be of assistance to many businesses, the Local Enterprise Office Donegal will also continue to make free mentoring/consultancy available to any business seeking assistance in addressing these issues or in developing a short action plan for the re-launch of their business once this crisis is passed.

We will also continue make contact with our clients by email and phone to discuss your on-going situation.

The other major challenge will be how small business owners manage their staff over this period. Already Government has made changes in the Social Welfare system to enable of payments of €350/week to be received employees and employers who have lost their jobs because of the virus see www.DEASP.ie for queries regarding income support and to apply wee www.mywelfare.ie The Government this week has introduced a Wage Subsidy Scheme through Revenue up to a max of €410/week per employee see www.revenue.ie to assist businesses retain their staff.

These Local Enterprise Office supports are in addition to the full range of Local Enterprise Supports which we will seek to continue to deliver as best as possible during this difficult period.

For existing grant-aided clients of the Local Enterprise Office the following changes have been agreed nationally and we would urge grant-aided client to contact us to discuss these:

  • Local Enterprise Offices will accelerate the payment of all grants subject to the necessary documentation having been received.
  • Moratoriums of up to three months on the repayment of refundable aid will be favourably considered by the Local Enterprise Office. Please note that this moratorium must be requested.
  • The Local Enterprise Office will consider extensions to the time period for clients to draw down any approved grant aid. Again a formal request for such a time extension must be made to the Local Enterprise Office in Donegal.

In relation to supports for businesses generally, the Department of Business, Enterprise and Innovation has put in place a package of business supports including:

  • Important changes have been made to the MicroFinance Ireland supports for microenterprises. The maximum loan available from MicroFinance Ireland has be increased from €25,000 to €50,000 as an immediate measure to specifically deal with the impacts of COVID – 19 on micro-enterprises (sole traders and firms with up to 9 employees). Applicants have to have or anticipate a reduction of at least 15% in turnover/profitability as a result of COVIC-19 and are having difficulty/ unable to access commercial bank finance. Applications can be made through the MFI website https://microfinanceireland.ie/ or through the  Local Enterprise Office Donegal.

 

  • The COVID–19 Working Capital Loan which is currently being finalised by SBCI and will be available by the end of next week.  This is for eligible businesses impacted by COVID-19. Loans of up to €1.5m will be available at reduced rates, with up to the first €500,000 unsecured. Applications can be made through the SBCI website https://sbci.gov.ie/.

 

To contact the Local Enterprise Office call us on 1890 607000 or 074 9160735 or email at  info@leo.donegalcoco.ie or michael.tunney@leo.donegalcoco.ie

 

 

 

 

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