The economic uncertainties of business leaders in the face of the crisis

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Since the beginning of the crisis, the economic uncertainties of business leaders have been growing. Indeed, the current period, unprecedented and uncertain, has taken the whole market by surprise. Economic players remain attentive to the daily developments in their sector of activity. For business leaders, the prospect of an imminent recovery raises many questions. To answer their questions, and guide them, a green number “COVID Business Solidarity” has been set up.

A Hotline to answer questions from business leaders

Launched by the National Council of Judicial Administrators and Judicial Agents with the support of the Ministry of Economy and Finance, the Hotline is free. By calling 0800 942 564, the leaders are in contact with specialists in prevention and treatment of difficulties. Callers are put in touch with an interlocutor who answers their questions on a case-by-case basis, completely free of charge. According to an initial report by the Ministry of Economy and Finance and the CNAJMJ published on 7 April 2020, the Hotline is in high demand. Indeed, more than 1500 business leaders dialled the green number in 10 days. A total of 200 directors and judicial agents are available to officers, and this volunteer.

During conversations, agents and administrators identify valuable information to portray and concerns of executives. Of the 98% of calls that received a response, the information helps to identify recurring questions. The majority of calls have been made by small businesses, TPE, micro-enterprises and independents, and relates to the solidarity fund. This aid to the tune of 1500 euros supports small structures in difficulty and is obtained under certain conditions. For example, the beneficiary companies concerned are affected by an administrative closure, preventing their continued activity. Otherwise, these are small structures that have suffered a loss of at least 50% of their turnover. This applies in March or April 2020 compared to the same month of the previous year. This is a total fund of 7 billion euros that will be available until the end of the crisis.

You can see all the details indicated by the Ministry of Economy.

Leaders’ projections of an uncertain economic future

Faced with the suddenness of the crisis, many professionals were caught off guard. While some companies have turned to telecommuting, their activities allowing them to do so, many have had to stop their activities. This raises the question of partial unemployment, and its implementation. This request concerns nearly 15% of the calls received by the Hotline. The influx of leaders to aid platforms to begin administrative procedures has sometimes temporarily blocked them. This has caused them inconvenience, as the process is only done online. For these companies whose activity is greatly reduced or even stopped, this is a delicate and unprecedented moment. For them, the shutdown means a loss of turnover. More customers, and therefore more income, but rent and expenses to pay all the same each month. Fees that, combined, greatly affect the cash flow of companies.

In this situation, questions are frequent and provide insight into each leader on a case-by-case basis. This reassures them and provides expert explanations to know exactly what the appropriate solutions are. The distribution of management calls fairly closely follows the size of the employment pools. Indeed, the region that recorded the most calls is the Isle of France, with a proportion of 18%. It precedes the Auvergne Rhônes Alpes region and the PACA region (16 and 15%) respectively. New Aquitaine, on the other hand, recorded 6% of calls to this number. At the same time, regional initiatives are multiplying to support and advise affected companies. Chambers of Commerce, Business Clubs and Regions directly offer assistance and advice to leaders in difficulty. Proof that solidarity is more than present in a climate of uncertainty and questioning about the future.

Business sectors impacted in the face of an unprecedented economic period

For more than a month, France has been at a standstill, as have several sectors of activity. If we begin to see a gradual return to normalcy, many sectors are questioning their own future. The country is indeed one of the most renowned for the quality of its gastronomy. Since the beginning of the containment, all restaurateurs have had to close their doors, except if they offer takeaways.

In Bordeaux, a whole section of the economy has stopped, the metropolis being renowned for the quality of its establishments, with the presence of renowned chefs, notably Chef Philippe ETCHEBEST, spokesman for restaurateurs throughout the territory. For example, calls from people working in the hotel and restaurant industry account for almost 20% of communications. They are closely followed by retail businesses (18%), which, considered non-essential, have not been able to continue their activity. This is a major blow, especially for independent traders, who are very numerous in Bordeaux.

On the eve of the launch of the summer season, where tourism is in full swing in France and especially on the coasts, the crisis will leave a bitter taste. Indeed, the closure of country borders in Europe and the rest of the world will block air traffic planned for the summer. Governments in different countries apply restrictive measures to prevent tourist travel to prevent a recurrence of the virus. For example, the prefecture of Gironde has banned all tourist rentals during the spring holidays.

While during the crisis measures and aid increased to support the local economy and the most affected businesses, the question of afterlife remains unresolved. The gradual recovery of activity will be a real challenge, especially for sectors that have not been able to continue their activity.

Sources:

CnAJMJ and Ministry of Economy and Finance data from April 7, 2020

“COVID Business Solidarity Hotline”

CRT New Aquitaine at your side – Covid-19

Trump France – Covid-19 information

Gironde Prefecture

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