To understand more about the impact of COVID-19 on our clients and the local Brighton community, we have decided to ask them some questions.
Next Up is Virtual Umbrella, an innovative, ambitious, and fiercely passionate marketing agency founded by Bertie Millis and Samantha Kingston in Brighton.
- When did COVID-19 affect your business and was it immediate or gradual?
COVID-19 was a looming threat for our business from January as I had been in Tokyo for work and returned shortly before COVID-19 reached Japan. We knew it could impact us severely if it was to make it to the UK. From the very beginning we were open with the team, we did some contingency planning and tried our best to remain optimistic and keep up with business as usual.
In the middle of February we started to see conference cancellations so we did a twitter poll called “How much has coronavirus affected your business?”, we ran this for 3 weeks and watched the number of people replying with “over 50%” increase. It was at this point we knew this would be a concern so we spoke with our clients about their plans to discuss potential impacts to work.
On the 17th March when Boris Johnson said “people should be working from home if possible”, the impact of COVID-19 became immediately more apparent. Within the week we lost 75% of our forecast revenue as events were scrapped or postponed.
- What decisions have you had to take in respect of your business?
We have been working remotely since the 18th March, it has changed the way we work as a team. We have had to move to an output based management style where we expect work to be done by a certain deadline but we don’t mind when you do the work, we don’t have a 9-5 working structure anymore.
As a business we were looking to diversify our service offering to gain more work outside of events, the lockdown has actually given us an opportunity to pursue this further and we are doing more consulting work than previously. This has been beneficial for us as a company because the profit margins are better for us and therefore keeps us more financially secure during the uncertainty.
- Have you accessed or will you be accessing any of the Government support schemes and grants?
We have been able to access some government support. For a while we were concerned that we may fall through the cracks. Our personal income is mainly dividends so we could not benefit from the furlough scheme and as company directors we are not eligible for the self-employment grants.
Thankfully we have benefited from the introduction of bounce back loans, we did not require the significant loan size offered by CBILS so the bounce back loan is much more appropriate for us.
We have borrowed £30,000 with the intention of holding this as “just in case” working capital as we do not know the further implications of a world with mandatory social distancing.
The process for applying for the bounce back loan was incredibly easy and fast. We applied on the morning they opened and the process took about 20 minutes. Main questions asked were about the impacts on our business during Covid-19 and looking at our yearly turnover. Once completed we received an email confirmation. We expected to wait for further communication from our bank but to our surprise the money arrived in our bank after 24 hours.
- What tips can you give other businesses currently going through the crisis?
Our advice to businesses is look at the support being offered and take everything you can. If your business is being affected then aggressively furlough to preserve cash, take the maximum bounce back loan you are eligible and hold the cash. At the end of the day, it’s interest free for 12 months so you can pay it back in full in a year’s time for nothing or if you need to use the money, the interest rate is only 2.5% so £30000 would cost you under £3000 for a 6 year borrowing term.
Additionally we all need to look out for each other, offer help to other businesses for free or for service exchanges, support charities and freelancers that may be falling through the cracks.
Author; Samantha Kingston & Albert Millis @ Virtual Umbrella
Date Published: 14 May 2020