LendingTree Survey of Small Business Owners Finds 46% are Concerned They Won't Have Enough Money to Reopen
- Almost 6 in 10 small business owners will reopen as soon as they're allowed. However, 15% said they'll wait a little longer to open and another 26% aren't sure when they'll ever reopen.
- Fewer customers and fewer sales are expected by 46% of small business owners upon reopening.
- Just 17% think they'll get the same number of customers spending the same amount as they did prior to the coronavirus pandemic.
- Not having the funds needed to reopen is the primary reason small business owners would not reopen once stay-at-home orders are lifted. They wonder if profits would warrant reopening as they also worry about the safety of themselves and employees who may not want to return.
- About 63% of small business owners surveyed have applied for funding through the Paycheck Protection Program.
- Of those who applied for a PPP loan, 44% have received funding. This is a significant jump from our April survey, where we found just 5% of those who applied were approved.
- However, more than half of business owners who received PPP funding are nervous they won't meet forgiveness criteria. Some are more worried than others: 24% are "very concerned," while 29% are "a little" concerned.
Small business owners have reservations about reopening
Although most small business owners are eager to reopen once their cities and states fully lift restrictions, some entrepreneurs worry about the lingering effects of the pandemic. Just 11% of respondents said they have no anxiety about reopening.
The biggest concern for 39% of small business owners is that they will not generate enough sales to make opening worthwhile. And 30% are nervous they would have to shut down again if there is another spike in coronavirus infections. A smaller group is worried about complying with ongoing social distancing and health safety guidelines, as 8% said that was their main concern, while 5% are most troubled about employees not wanting to return to work.
Fortunately, 52% of survey respondents expect all of their employees to return to work when the business reopens. Nearly half — 48% — plan to bring back the same number of people at the same number of hours. And only 23% of business owners expect to employ fewer people for fewer hours when they reopen.
Despite promising PPP loan approvals, financial concerns remain
Among our survey respondents, 26% applied for a PPP loan from the
The SBA released its PPP loan forgiveness application after weeks of confusion around the forgiveness process. Borrowers must spend at least 75% of PPP loan funds on payroll expenses and no more than 25% on mortgage interest, rent payments and utilities to qualify for forgiveness, spending those funds within eight weeks of receiving their loan. However,
For those moving full steam ahead, 54% of business owners plan to inform customers of their reopening through email. To encourage business, 43% of respondents are going to offer special promotions or sales. About 31% plan to use paid social media ads to promote their business in the first month after reopening, while 35% expect to take advantage of unpaid organic social media content. Approximately 9% of business owners don't have any plans to promote their business after reopening.
For more information about the survey and its findings, please visit: https://www.lendingtree.com/business/survey-businesses-worried-not-enough-money-to-reopen/
LendingTree conducted an online survey of 1,260 small business owners who had previously applied for funding through LendingTree's small business lending database. Of the total respondents, 757 business owners had applied for a PPP loan. Participants were emailed a link to participate in the survey, which was fielded using Qualtrics from
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