Community businesses plan for expansion in wake of Covid-19 crisis

New report from Power to Change shows 55% of community businesses expect to open up new line of trading activity.

They’ve been the backbone of grassroots support throughout the Covid-19 pandemic – providing a lifeline to many local communities by delivering essential food, supplies and services. Now, a new report reveals that community businesses are turning the difficulties experienced as a result of the coronavirus crisis into an opportunity to diversify and expand their operations in communities across the country.

Initial findings released from the Community Business Market Study, commissioned by independent trust Power to Change, shows that over half (55%) of community businesses expect to open up a new line of trading activity or diversify their products and services as a result of the pandemic.

Indeed only 1% of community businesses said they had succumbed to the lockdown and shut their doors for good. An astounding 89% said they had adapted operations to remain open, innovating at great speed.

The findings of Power to Change’s latest report reflect the resilience and adaptability of community businesses when compared 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 (Jahshan, 2020[1])

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.”

According to the Community Business Market Study, almost half (46%) of community businesses moved to remote services throughout the pandemic, a quarter (24%) introduced vital community services to care for the vulnerable and 14% adapted their business to provide support through food banks.

How community businesses responded to Covid-19 crisis

The Bevy, a community pub in Brighton, set up a meals on wheels scheme during lockdown to deliver food and care to the most vulnerable. Following a massive response from the community, the initiative has become a mainstay of The Bevy’s operations and has continued even though the pub has reopened.

Sutton Community Farm adapted to the rising demand for food delivery during lockdown by scaling up its VegBox service. This resulted in a 50% increase in vegetable box deliveries by the business. As the community has become more involved in supporting the farm during the pandemic, it has also seen order frequency and average spend on its VegBox service increase.

Nudge Community Builders, a community business that finds new uses for derelict buildings in Plymouth, created a wi-fi net between the buildings so it could provide free wi-fi to the community.

However, the Community Business Market Study also identifies the severe financial hit that community businesses have faced. Most community businesses (73%) said they are less confident about their future financial prospects due to the pandemic. And eight in 10 (79%) said they had received some form of financial support during the pandemic.

Support for community businesses

Power to Change, which supports more than 1,000 community businesses across England, 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 alongside concerns of future financial viability, community businesses are looking at new ways to future-proof their businesses in the event of a second wave and tougher lockdown measures.

The same early analysis also shows that community businesses operating in the South West and North West have been hit hardest – with 17% of those in the South West and 16% of those in the North West applying for financial assistance so far.

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.

This includes those businesses reliant on older volunteers, many of whom have been shielding from the virus. Over half (57%) of the community businesses surveyed reported a decrease in their number of volunteers.

For more details and to view the initial findings from the Community Business Market Study and Reniasi’s analysis of Power to Change’s Covid-19 emergency funding, please visit https://www.powertochange.org.uk/research/impact-covid-19-pandemic-community-business-market-survey-2020/

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For more information relating to the press release contact laura.hunt@bjl.co.uk  or telephone 07713 214703 

About Power to Change

Power to Change is the independent trust that supports community businesses in England.

Community businesses are locally rooted, community-led, trade for community benefit and make life better for local people. The sector owns assets worth £890m and comprises 9,000 community businesses across England who employ 33,600 people. (Source: Community Business Market 2019).

From pubs to libraries; shops to bakeries; swimming pools to solar farms; community businesses are creating great products and services, providing employment and training and transforming lives. Power to Change received its endowment from the National Lottery Community Fund in 2015.

www.powertochange.org.uk  @peoplesbiz

About The National Lottery Community Fund

We are the largest community funder in the UK – we’re proud to award money raised by National Lottery players to communities across England, Scotland, Wales and Northern Ireland. Since June 2004, we have made over 200,000 grants and awarded over £9 billion to projects that have benefited millions of people.

We are passionate about funding great ideas that matter to communities and make a difference to people’s lives. At the heart of everything we do is the belief that when people are in the lead, communities thrive. Thanks to the support of National Lottery players, our funding is open to everyone. We’re privileged to be able to work with the smallest of local groups right up to UK-wide charities, enabling people and communities to bring their ambitions to life. tnlcommunityfund.org.uk

[1] Jahshan, E. (2020) ‘20% of high street shops won’t reopen after lockdown, MPs warned’, Retail Gazette https://www.retailgazette.co.uk/blog/2020/04/20-of-high-street-shops-wont-re-open-after-lockdown-mps-warned/