Real business stories

Self-employed in COVID-19 – Shall I continue to work for myself? Part 2.

In August 2020 the Business Finance Guide published an article entitled Self-employed in COVID-19: shall I continue to work for myself? The response, from both our audience and the small businesses that wanted to tell their story, was huge. The coronavirus pandemic has affected many businesses, with statistics showing that 76% of British businesses do not employ anybody other than the owner, we met self-employed people from around the UK to hear about their experience of business and finance in 2020.

In this second instalment, we tell the stories of three small-business owners now operating in a COVID-19 world – a personal trainer from Hampshire, a caterer from London and a health and wellbeing coach from Northamptonshire. They discussed the challenges they’ve faced since March 2020, where they are now, and what the future holds for the grass roots of the British economy.

 Meet the businesses

Louisa Daniels, personal trainer, Hampshire: I was working up in London in PR. I loved fitness and it was on the advice of some friends that I took a PT course. I haven’t looked back since.

I set up my own personal training business, By Louisa, in October of 2018. From my commercial experience I felt like I knew how to run a business and how to find my market and promote myself. The next logical step was to go out on my own. To enjoy the results and then to see the responses from clients is amazing.

Hannah Kilmurray, caterer, London: I’ve always worked in marketing and project management, and I was finding it really hard to advance as a young woman in business. My industry is very male-dominated and I felt that the environment was halting my progression. I decided that, in order to progress, the best chance I had was to branch out in business on my own.

I’ve loved food forever and felt the time was right to start my own catering business, Lovebite London. Beyond simply food delivery in London, my goal is to deliver really special meals to people who have chosen a self-catering holiday in the UK. ‘Staycations’ are on the rise in Britain, so I’ve created menus that are ordered and delivered in time for a clients arrival on holiday. Great food, without the shopping or cooking.

Emily Carpenter, health and wellbeing coach, Northamptonshire: I previously worked for a business that helped people with health conditions and disabilities to find employment. I discovered that working with people is my calling. I trained as a health, fitness and wellbeing coach and started EmPower Fitness.

I offer my clients everything from nutrition advice to massage, and I coach fitness one-on-one and to small groups. What I do has the power to literally change lives, and it’s incredible to bring people that happiness, empowerment and fulfilment. My aim is that whenever somebody walks out of my studio, they do so feeling stronger and more confident. The majority of my clients join me not knowing their strength and I help them to find it.

Business owners

What was your business like before the pandemic hit?

Louisa: Like with all businesses, things grew slowly at first, and then gathered momentum. It all just started to happen in 2019.

As you would expect in the fitness industry, the year has peaks and troughs. After two years of really hard work, I had consistent ongoing revenue and some great clients. I had reached a point where I wanted to scale, I’d already begun to look at investment, and when COVID-19 hit I was exploring opportunities for a new studio with shop frontage.

Hannah: I’m a start-up in year one. I’d only just launched my business in the first quarter of 2020 and started trading right before lockdown. Fortunately, it was absolutely the right time to launch a food delivery business in London. I took advice of course, then I decided not to wait, but commit.

It’s been a testing time in terms of ensuring that my business functions and grows. I just had to be brave enough to do it in the first place.

Emily: Things were going well. I’d hit some peak months with regards to income. That’s not an immediate reflection in terms of the progress that my clients had made, but they had been my best months ever when it came to revenue generation. I was gearing up to start some new marketing to bring on some new clients, and then the pandemic hit.

What has been the impact of COVID-19 on the function of your business?

Louisa: The immediate impact was that it stopped me seeing clients face-to-face. This was a tremendous challenge. I had sessions booked that had to go on hold, and at that time I couldn’t give clients a date for when my studio would reopen.

I think I’ll always remember the two weeks leading up to the announcement of lockdown. They were really stressful. Nobody knew what would happen next, so it was difficult to respond to that in a business sense, to know whether or not to work with clients at all.

As a trainer, being responsible for your clients’ health and wellbeing is paramount. To be conflicted with the feeling of having a business to run was really tough. My clients were affected too, in their work, their businesses and in their own lives. I lost clients and I don’t know if I’ll ever get them back. It was a very stressful time, there were a lot of tears and two or three weeks of limbo. My business was too young to have a huge network of clients, so I just had to work through it.

Hannah: I’ve had to manage my growth really quite closely. Building a reputation for quality and delivery is essential and I pride myself on it. The demand soared really quickly – food is so important to us all when times are hard, especially when people can’t go out to eat.

I had to take the orders that I could fulfil and make sure that we delivered. We do a home-delivered Sunday roast dinner, something people would typically go to a pub for. As you could imagine, I had a huge demand for it really quickly and it took a lot to manage. Functionally, I have commercial kitchen space at home, but because of lockdown it’s only me cooking. I have a partner that manages sales and helps me.

Emily: We started to get inklings quite early that things were going to change. I started taking steps around safety and hygiene to make sure that people were safe when they came to the studio. I kept an open dialogue with my clients. Then the news came that we had to shut down. It stopped everything.

I was supported by my professional development network, Lift the Bar. That was lucky – they were really good. I went into lockdown knowing that I was going to keep around a third of my income from working online. I remember the day that I had to shut my studio for the last time. I was in tears in the morning and my clients even brought flowers and cards into the studio. It was really hard. I vowed that I would continue in some form or another.

How did you respond to these challenges?

Louisa: I went online, as lots of people did, running classes on Zoom. It wasn’t without its challenges, entering into competition with Instagram fitness bloggers who have huge followings and reputations and who were offering classes for free. It’s daunting and really hard. I went about marketing in a completely different way.

The biggest challenge I found with COVID-19 actually wasn’t at the beginning, but towards the end. The continuously changing information and uncertainty was so stressful. The yearly fluctuation in the fitness industry was almost happening week to week, and all the bad news was driving my clients’ motivation to be active through the floor.

Hannah: It’s all a question of time management for me and relationship management with our partners . I’m really trying to grow the right way. In general, our supply chain has been fine. Of course, our partners are wholesalers, but if we get caught short of an ingredient or two then we can dash to a local supermarket.

Emily: Over the first week of lockdown, I drove around our area delivering resistance bands and weights to my clients. I actually loaned out a lot of my kit, so people could use it and join me on Zoom. It was funny dropping equipment at people’s doors and then running back to the end of the drive, all while they waved from the window.

What’s been really lovely is the Zoom experience. It opened up what I do, and I’ve been joined on Zoom by people who are training with their children. It meant that I really got to know my clients outside of working with them in the studio. We built stronger relationships and it was actually quite a positive thing in a difficult time for everyone.

I hope to keep and maintain a lot of the clients I made in lockdown because of the relationship that we’ve forged. I think it ended up being a bit of a lifeline for a lot of them – exercise has such a positive impact on mental health.

Did you seek out any government support that was on offer?

Louisa: I run my business well and that stood me in good stead. I’ve been in business for less than two years, so I didn’t qualify for any government help. I had savings and just had to work through it.

I remember sitting down with a pad and thinking, I’ve put everything I have into this business, I’m not going to sit here and watch it fail. I needed to brainstorm ideas to make it work. Ultimately, I love what I do, it’s such an important part of my life and my lifestyle. Working with clients is so good for my own mental health, I wasn’t going to give it up and find another job.

Hannah: I’ve self-funded so far, I’m just going to wait out this year and grow at my own pace. I think COVID-19 is a really big test. My hope is that with the business being born in these times, it will stand us in good stead for the future. I’ll consider a supply chain finance solution just to ensure that we grow safely.

Emily: I did take advantage of the support offered. I basically went for everything that I was able to get – that’s what it is there for. The thing is that when you’re really quite scared in terms of what is going to happen next and the future of your business, you’ll take all the help available, so I took advice and applied as soon as the links were active.

I had to make sure that the business kept going and so there was no pride blocking me from seeking help. I was very fortunate that my studio qualified for small business rates relief – I got a £10,000 grant. I also took out a Bounce Back Loan that I have yet to draw down on – I wanted a cash backstop in case I needed it.

The importance of access to cash in uncertain times

We spoke to Amanda Digne-Malcolm, Director of Practice at ICAEW, herself a former self-employed chartered accountant, for her insights.

‘I think now more than ever it’s prudent for a business to have access to cash. Managing cash flow is absolutely vital to businesses surviving especially in times as uncertain as the ones that we face. If businesses are seeking to grow, however slowly, or if their aim is just to survive, then cash should be their priority. Even forecasting is difficult currently and having a secure cash reserve, that can be accessed quickly, can ensure businesses survive and thrive.

‘Government measures are in place to support small businesses, it’s absolutely right and prudent to take advantage of them. The vital next step is to continue to review that cash position on a monthly basis. The best way to keep a handle on everything is with the help of a trusted, professional advisor.’

Amanda Digne Malcolm

Finally, what does the future hold?

Louisa: Completely conversely to what I expected and all of the stresses, COVID-19 has actually done my business some favours. Having started with Zoom classes, I extended my online offering into one-to-one sessions with my clients. I never thought I would, I didn’t think it would work. I thought personal training was always done in person.

I learned a different set of requirements within my market. I was able to train clients, observe and listen, and my clients really liked me holding them accountable through my sessions online.

Going online helped to reduce my prices and then my demand soared. I launched an online membership platform called Team By Louisa, which was always a long-term goal, but I did it in July 2020. I’ve been able to offer a full range of classes and I’ve even brought in a yoga instructor to add to my offering. My membership is growing quickly – I’ve even set myself targets to meet by the end of the year.

Hannah: The goal is to continue to grow the right way and work hard. Ultimately, I want to offer our delivered catering service for international holidays, in ski resorts and on yachts. The plan for this first 12 months is to ensure that we’re in business for the next 12 months.

Emily: I have some big ideas. Over lockdown my plan was to use the time as productively as I could. I completed additional qualifications in fitness yoga, nutrition, boxercise, and Swedish full body massage. I’m able to offer a greater range to my clients and I can now work as a nutritionist. I’m also qualified to coach other coaches. This has been a really big test – long-term it looks bright, the next step is to grow the business.

Amanda Digne-Malcolm: We’ve recently seen the replacement of the furlough scheme with the new Job Support Scheme and the extension of the government-backed loan products to support UK businesses. There is also the extension of the VAT deferral in the tourism and hospitality sectors and all of these measures are positive for small businesses. More help is always positive, the alternative for a small business is potentially a financial cliff edge. I would encourage all businesses to seek the advice of an accountant in light of these and any new developments that are caused by the pandemic. It’s so important to be proactive and mindful of your cash position, an accountant can help a business to scenario plan for the best and worst-case and keep the management of cash under ongoing review, it’s the trusted relationship with your accountant that can be the difference maker in terms of a businesses survival. The Business Advice Service is available to assist small businesses in finding an ICAEW registered accountant in their local area.  Businesses are able to have a free initial consultation to begin to build that trusted relationship that will ensure their businesses survival and success.

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