As state leaders make decisions to lift lockdown, how does this affect small businesses?
Reece Tomlinson, CEO of RWT Growth – advisors to the global SME arena – comments on political statements.
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Alaska And Oklahoma To Lift Lockdown
Last week, it was announced that South Carolina, Tennessee and Georgia were due to reopen and ease their lockdown rules. Now, Alaska and Oklahoma are set to join this cohort: the former has already started opening restaurants and retail stores on April 24th, and the latter is due to follow suit on 1st May. These steps are very promising for small business owners, who are finally beginning to see the light at the end of the tunnel.
In a time when people are looking to their nation's leaders for support and guidance, their statements have a direct - and often fairly immediate - impact on all aspects of life. The words of politicians have the power to instil or break confidence, and often this has a direct effect on how consumers will spend their money or firm owners will manage their businesses. For the world's small and mid-sized businesses, political rhetoric can heavily impact investor and consumer sentiment, having a significant effect on their sales and deal flow, both positively and negatively.
Affects Of The Announcement On Small Businesses
Reece Tomlinson, CEO and Founder of RWT Growth - who are financial advisors for the global SME arena - has commented on how these kinds of announcements affect small businesses:
"More so than ever before, the private sector and the general public are looking at politicians for guidance and reassurance to navigate through this period. Announcements from the President have repercussions, not just for businesses in the United States, but across the entire western world. Rishi Sunak's UK Budget in March, as another example, provided small business owners with the confidence that they would be supported through these difficult times, with a further Coronavirus package announced to the tune of £330 billion towards the end of the same month; even if this has not been executed smoothly, support appears to be there.
With this announcement from Trump of the phased reopening of the US, some businesses will begin to regain confidence in things returning to normal faster than previously expected. South Carolina, Georgia and Tennessee are expected to open businesses - in Georgia, gyms and beauty salons were open from Friday and restaurants are due to follow today. Business owners in these states will certainly feel more optimistic about the future of their firms as life begins to resume some level of normalcy. This can give investors and intermediaries the reassurance to start returning to pre-COVID levels. The issues arise if this isn't the case and business begins to slow.
Politicians, particularly at this time, need to give the private sector the confidence to get through this period, balanced with the transparency to allow business leaders to plan efficiently for the future. This is a time when many businesses could struggle, so being open with the private sector will help them survive and rebuild after this pandemic."