Highlands and Islands businesses adapt to grow in the Covid economy, study finds
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A fifth of Highland and Islands businesses have overcome the challenges of the pandemic to actually expand over the last 12 months, a new study has found.
Research by Rathbone Investment Management found 22 per cent of business owners in the Highlands and the Outer Hebrides had seen their business grow in the past year, largely through changing their business model to adapt to the change of circumstances. This included a move to online sales as a new or greater source of income.
A further 15 per cent of business owners surveyed had started up their business during the last year as the pandemic sparked new ideas and opportunities.
There was positive news in the Northern Isles too with businesses in Orkney and Shetland the most likely to have expanded in the pandemic (33 per cent).
However, the pandemic has had significant implications for many businesses across Scotland, with 37 per cent reporting that they had suffered during the pandemic.
This was slightly higher for businesses in the Highlands and Outer Hebrides, where 39 per cent said their business had suffered.
The ongoing social restrictions have forced large numbers of businesses to close over the last year, with businesses in retail, leisure and hospitality most impacted.
However, as Scotland, alongside the rest of the UK begins to open up, many of Scotland’s business owners and high-net-worth individuals (those with investable assets over £250,000) are optimistic about the state of the economy, with 59 per cent saying that they were optimistic about the economic outlook of the next 12 months.
Simon Dewar, regional director at Rathbones, commented: “The past 12 months have been difficult for businesses across Scotland with every organisation needing to adapt to some extent due to the pandemic.
"However, the impact has been disproportionate with some businesses severely financially impacted. While government support has gone some way to support these businesses throughout this period, its unlikely we’ll see a true recovery until restrictions are fully lifted. With the vaccine roll-out ongoing, many business owners will be holding their breath and hoping that this effort reaps dividends and we can stick to the timelines set out in the roadmap.
“It’s clear from our research that Scottish businesses are largely optimistic for the future, with a high proportion expecting a positive outlook for the economy in the next 12 months. As businesses start to recover from the initial impact of the pandemic putting a financial plan together to rebuild any safety net that may have been eroded away will be key for business owners.
"Many businesses have deferred any expansion plans over the last year as the focus has been on survival. As confidence grows, so will the sparks of entrepreneurial endeavour, with businesses dusting down these plans and using what they have learned through the crisis to seize opportunity and build robust businesses that drive our economy.”
