Scottish Textile News
From today (Wednesday 13 May 2020) self-employed individuals whose business has been adversely affected by coronavirus will be able to apply for a Self-Employment Income Support Scheme (SEISS) grant, worth 80% of their average monthly trading profits, up to a maximum of £7,500), paid in a single instalment.
If you are eligible you will be able to make your claim on a specified date between 13-18 May, based on your Unique Tax Reference number.
HMRC has assigned eligible self-employed individuals a specific date to apply on and this can be checked on HMRC’s online checker at any time here.
People will not be able to apply before their claim date but can make a claim after that day.
The claims process is simple, and those eligible will have the money paid into their bank account by 25 May 2020, or within six working days of completing a claim.
In order to make a claim you will require the following information:
Under SEISS, those who are eligible will be able to claim a taxable grant worth 80% of their average trading profits up to a maximum of £7,500 (equivalent to three months’ profits), paid in a single instalment.
You can check your eligibility using the new online checker tool. Once the online check is complete, those who are eligible will be given a date when they can submit their claim.
The claims service will open on 13 May and those eligible will have the money paid into their bank account by 25 May, or within six working days of completing a claim.
There is further guidance available on how HMRC will calculate payments here.
From tomorrow (1 May 2020), PPE purchased by care homes, businesses, charities and individuals to protect against Covid-19 will be free from VAT for a three-month period.
A £100 million package of additional grant support for small and medium sized businesses and newly self-employed people is now open for applications.
The three separate funds will be administered by local authorities and Scotland’s enterprise agencies and will begin to pay out grants in early May.
The funds can be accessed via the www.FindBusinessSupport.gov.scot website.
Details of the new support packages are as follows;
Grants of £2,000 for those who became self-employed after April 2019 and are not eligible for UK support. Will be managed by local authorities.
· £20 million Creative, Tourism & Hospitality Enterprises Hardship Fund
Grants of up to £25,000 for small and micro creative, tourism and hospitality companies not in receipt of business rates relief. Will be managed by the Enterprise Agencies with support from Creative Scotland and VisitScotland.
· £45 million Pivotal Enterprise Resilience Fund,
Providing bespoke grants and wrap around business support to viable but vulnerable SMEs who are vital to the local or national economic foundations of Scotland.
A new online portal from Skills Development Scotland on the My World of Work platform helps to connect people with thousands of free-to-access online learning materials.
Find out more here
China Market Update: Opportunities and Impacts on Consumer Behaviour from COVID-19
Thursday 7th May, 9:30-10:30am
Amid the COVID-19 pandemic, the traditional drivers of China’s economy may be struggling but the country’s consumers keep spending. As one of the first markets globally showing signs of economic recovery, what opportunities can China offer for Scottish consumer companies?
Economy Secretary Fiona Hyslop has confirmed that grant funding for the newly self-employed suffering hardship and SMEs in distress will be available in the coming days.
The £100 million fund to support the self-employed and SMEs announced last week will be broken into three separate funds as follows:
The recently self-employed, who are excluded from the UK’s scheme but suffering hardship, will be able to receive £2,000 grants. For creative, tourism and hospitality companies of up to 50 employees not receiving business rates relief, there will be rapid access £3,000 hardship grants or larger grants up to £25,000 where it can be demonstrated support is needed. The support and larger grants for pivotal SME enterprises will depend on the specific need of the enterprise and be developed by the relevant enterprise agency with wraparound business advice and support.
The Scottish Government has announced an additional £220 million of support for small businesses and the self-employed.
The new package of measures includes £120 million to extend the Small Business Grant scheme to ensure that, in addition to a 100% grant on the first property, small business rate payers will be eligible to a 75% grant on all subsequent properties.
A further £100 million fund is also being made available to protect self-employed people and viable micro and SME businesses in distress due to COVID. This fund will be channelled through local authorities and enterprise agencies to target newly self-employed people and businesses who are ineligible for other Scottish Government or UK Government schemes.
Textiles Scotland will provide more details as they become available.
Simon Cotton, CEO of Johnstons of Elgin, on the importance of coming together as an industry and relying on your networks to help make difficult decisions during the Coronavirus outbreak.
I run Johnstons of Elgin, which is the United Kingdom’s largest textile employer. We operate manufacturing sites in the North and South of Scotland with both weaving and knitting, and have a fully vertical operation from fibre to finished garment. We employ around one thousand people, manufacturing for the world’s top luxury brands as well as for our own label. I also sit on the board of UKFT and Chair the Scottish Textile Industry Leadership Group.
Running any business is never easy, but this is certainly the most challenging period I have ever experienced in my business career. Just a few weeks ago life was continuing pretty much as normal. Now our whole operation is in its third week of lockdown and almost all of our workers are furloughed or working from home. We have reduced demand, no production, no retail and very few staff still working.
Each decision we took to get to this point felt painfully hard at the time, but looking back seems straight-forward. First we deliberately reduced efficiency through physical changes and creating breaks between shifts. Then we closed our retail operations and sent all retail staff home. Then we closed manufacturing. They were difficult decisions and they were fast decisions, but they were never decisions I made alone. Taking the decisions collectively meant that we considered every aspect before acting. Collective decisions also acted as an excellent check and balance as, at this moment, my views are inevitably coloured by the last news report or social media post I read.
I am fortunate to have an extremely strong management team working with me. Despite that, I reached out to UKFT and I spoke widely with contacts in other businesses. I have sat in on countless video and teleconferences and listened to as many experts as I can. I would urge any textile business owner, however large or small, to rely more heavily than ever on their network and to use organisations like UKFT for expert advice. It will not only help you make better decisions, but it will also help relieve some of the burden of responsibility, which I know rest very heavily when your decisions affect both jobs and lives.
We have found it extremely helpful to consider the current crisis in phases, and we have now passed through the “safer working” phase into the closedown phase. As you all know, there is significant support available from the government, particularly through the Business Interruption Loan Scheme and the Job Retention Scheme. These schemes are superficially excellent, but understanding the detail of exactly how they will apply is very difficult, as the information supplied by the government so far lacks the necessary detail. We are seeing lawyers disagree with other lawyers, as they try to fill in the blanks of how these schemes will operate. No one should be embarrassed about feeling overwhelmed by the confusion which exists. None of us have the information we need to make perfect decisions. We have made the best estimates we can based on the expert advice we have taken, but I am sure some of those interpretations will turn out to be incorrect.
So much is uncertain in this phase, that it is tempting to avoid planning altogether and take each day as it comes. I think that would be a mistake and we have made careful, but unavoidably approximate, cash flow projections based on different scenarios about when we might return and what demand there will be. We also looked at profit and loss but, in this situation, managing cash is far more important and will determine if a company survives or not. Much as we may not want to face up to some of those scenarios, it is crucial that we have looked at them, understood where the critical points are and have a basis for informed discussions with our lenders.
During this phase we are working hard to stay in touch with customers and consumers. There are opportunities in ecommerce but we are being very sensitive about how we approach these. Our social media engagement levels are at record highs and our brand followers have a particular interest in our human stories, about our history and our people. Sometimes those engagements turn into orders but more often, they simply keep our brand connected to those who will form our customer-base when normal life resumes. We also talk to our trade customers as much as we can, despite the fact that there is limited information we can share at the moment. There is also limited information many of them can give to us on their own future demand, as they go through their own challenges.
The next phase will inevitably be to restart operations. We have no idea of knowing when that may be, but we plan to take this also in phases, with a very small core team preparing the ground work for at least two phases of return. As with the close down process, those decisions will be debated extensively but quickly and decisions will be made collectively. This phase presents even more dangers than closing down, as we need everyone to be comfortable that they are returning to a place which is as safe as it can possibly be. If we move too early we risk damaging employee goodwill or making the health crisis worse and we may lose the opportunity the Job Retention Scheme brings to save costs which we may not need. If we move too late we risk letting down customers or losing them.
Following restart we will enter our recovery phase. In this phase we anticipate cancelled and postponed orders, as well as orders which are urgently needed. Good planning and customer relationship management will be critical and production efficiency will suffer, as we push and pull orders to fit our capacity and meet customer needs. It will be a busy time as we all emerge from the enforced idleness of lockdown.
We then face whatever the new normal might be. Although this is largely unknown at the moment, we can already see some of the factors which may come into play. Will we enter a prolonged recession or depression? How will workers who have been working from home for weeks on end want to dress when they come to the office? Will international travel patterns be changed in the mid-term and long-term? Most importantly, how will retailers and brands unwind their stock positions and repair their balance sheets over the next few years.
Into this mix we can add the health and mental health of staff; risk of bad debts; risk to supply chains; currency and raw material volatility and the risks and uncertainty still associated with Brexit. We take comfort in the 223 year history of our company in surviving the Napoleonic wars; the industrial revolution; two world wars; several floods and one major fire. When we look back on this it will make for another colourful chapter in our history book but right now, it is an incredibly fast moving and multi-faceted challenge.
• 2 April 2020
HMRC webinar - Helping employers to support employees
An overview of the support available to help employers and their staff in addressing coronavirus (COVID-19) – including the Coronavirus Job Retention Scheme, refunding eligible Statutory Sick Pay costs, furloughed employees and more.
• 3 April 2020
Financial crisis planning webinar
Business Gateway's financial expert will take you through financial crisis planning.
Essential HR crisis planning webinar
Business Gateway's HR expert will talk you through some areas of consideration for you and your business to not only support your employees but allow you to maintain your workforce.
• (No specific date)
Coronavirus advice for co‑ops
Co‑operatives UK is hosting a range of webinars in response to common issues arising for co‑ops during the COVID‑19 crisis.
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