Community businesses look to branch out after Covid-19

A survey from Power to Change also finds that 73% of community businesses are less confident about their future finances

A new report from Power to Change shows 55% of community businesses expect to open up new line of trading activity in response to the Covid-19 crisis.

Power to Change – the charity which supports community businesses – says the sector has been “the backbone of grassroots support throughout the pandemic – providing a lifeline to many local communities by delivering essential food, supplies and services”.

It has now released research – the Community Business Market Study –  which shows 55% of community businesses responding to the crisis by diversifying and expanding their operations.

The study also shows evidence of the resilience of the sector: only 1% of community businesses said they had succumbed to the lockdown and shut for good – while 89% had adapted to remain open. 

This compares favourable to other businesses: in a survey by the British Independent Retailers Association, 20% of retailers said they did not intend to reopen after the relaxation of lockdown restrictions.

Vidhya Alakeson, CEO of Power to Change, said: “The coronavirus crisis has underlined the vital role that community businesses play in supporting local people. And although they face many challenges as lockdown lifts, by being agile and adaptable to the needs of local people, so far many have proven to be very resilient. But there is a long road ahead and diversification of their services is central to help tackle the long-term challenges posed by the pandemic in their communities.” 

Related: How community businesses met the challenges of lockdown

Power to Change’s survey also found that 46% of community businesses moved to remote services throughout the pandemic; 24% introduced vital community services to care for the vulnerable; and 14% adapted their business to provide support through food banks. 

Responses include the meals on wheels scheme set up by Brighton community pub The Bevy; a 50% increase in VegBox deliveries by Sutton Community Farm; and the creation of a free wifi service to the community by Nudge Community Builders, a community business that finds new uses for derelict buildings in Plymouth. 

But the sector has also suffered a severe financial hit from the crisis: most community businesses (73%) said they are less confident about their future financial prospects due to the pandemic. And 79% said they had received some form of financial support during the pandemic.

Power to Change created a Covid-19 emergency response package, providing access to £12m in grants. 

Early analysis of their emergency support funding commissioned by Renaisi shows that community businesses are looking at new ways to future-proof their businesses in the event of a second wave.

The same early analysis also shows that 17% of community businesses in the south west, and 16% of those in the north west, have applied for financial assistance so far – making these regions the hardest hit.

In addition to reduced footfall and squeezed revenues, community businesses have been hit by a fall in the average number of volunteers available to help them carry out their work. 

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