Business Research: SME Response to COVID-19 Disruption in the UK

This report investigates the responses of small and medium-sized enterprises (SMEs) in the United Kingdom to the disruption caused by the COVID-19 pandemic. It examines the impact of the pandemic on SMEs, their decision-making processes during this period, the major challenges they faced, and the key opportunities that emerged. The research employs a qualitative approach, utilizing secondary data sources such as journal articles, online reports, and government documents. Through thematic analysis, the report identifies positive immediate responses for SMEs, highlights their decision-making processes, outlines major challenges like declining sales and supply chain issues, and analyzes opportunities such as embracing digital marketing and adapting to new consumer behaviors. The study also touches upon the effectiveness of national policy interventions in supporting SMEs during the crisis.

Business Research Project –
Entrepreneurship
[TO INVESTIGAT THE RESPONSE OF SMALL AND MEDIUM SIZED ETERPRISES TO
COVID-19 DISRUPTION]

TABLE OF CONTENTS
CHAPTER 1: INTRODUCTION..................................................................................................3
Background................................................................................................................................3
Rationale....................................................................................................................................3
Aims and Objectives.................................................................................................................4
CHAPTER 2: LITERATURE REVIEW.......................................................................................5
1. Impact of the corona virus (Covid 19) on businesses.....................................................5
2. Decision-making process of SMEs in the current pandemic time period....................5
3. Major challenges faced by small and medium-sized businesses due to Covid 19....6
4. Key opportunities for SMEs placed and prepared...........................................................6
CHAPTER 3: RESEARCH METHODOLOGY..........................................................................7
CHAPTER 4: RESEARCH AND FINDINGS.............................................................................9
Themes.......................................................................................................................................9
Findings....................................................................................................................................12
CHAPTER 5: CONCLUSION AND RECOMMENDATIONS...................................................12
CONCLUSION.............................................................................................................................12
RECOMMENDATIONS..............................................................................................................13
REFERENCES............................................................................................................................15
APPENDIX...................................................................................................................................18
Gantt Chart and WBS.............................................................................................................18
Ethics Form..............................................................................................................................19

CHAPTER 1: INTRODUCTION
Background
Presently the whole world is suffering from the very negative impact of corona
virus which is also known to be COVID-19, in which government of each country has
taken different steps towards systemically dealing with this pandemic. This pandemic
has had a very bad impact on different SMEs of the United Kingdom, because small
and medium-sized businesses of this country currently do not have appropriate
customers to sale their different products and services (Küçük, Lenoël and Macqueen,
2020). The main aim behind completing this research report is to investigate the
response of small and medium sized enterprises to COVID-19 disruption: implications
for the United Kingdom (UK). Small and medium size companies are facing several
problems because o Covid 19 pandemic. The reason behind selecting this sector is
helping out them in knowing ways of running business because small and medium size
are the one who got affected the most as compared to big organizations.

Rationale
COVID-19, currently everyone knows about this term, because it is the pandemic which
has very badly affected to the human live or human civilisation. There are thousands of
businesses and companies has been permanently closed due to this pandemic.
Basically, due to stop the spread of corona virus infection, governments within almost all
countries has imposed rule of lockdown their people or businesses. In this situation,
government of the UK also was imposed rule of lockdown in order safeguarding their
people, so this pandemic and lockdown has very negatively affected to the SMEs of the
United Kingdom (Carmody and et.al., 2020). The main reason behind choosing this
topic for the research topic is to know how the sector of SMEs within the UK deals with
this pandemic. This research work will also be able to know the government’s steps
which it has taken in the welfare of small and medium-sized businesses after the
pandemic.
Aims and Objectives
Aim
To investigate the response of small and medium sized enterprises to COVID-19
disruption: implications for the United Kingdom (UK).
Objectives
 To know about the positive immediate responses for SMEs should be for
recovering from the Covid 19.
 To highly the decision-making process of SME in the time period of pandemic.
 For identifying major challenges which has faced small and medium-sized
businesses due to Covid 19.
 For analyzing key opportunities to SMEs that has suitably placed and prepared.
 To know the effectiveness of national policy interventions and schemes for
supporting SMEs.
Research Questions

 What are the positive immediate responses for SMEs to systematically recover
from Covid 19 pandemic?
 What types of decisions are taken by different small and medium-sized ventures
in the current pandemic time period?
 What are the major challenges of Covid 19 which are currently faced by different
small businesses?
 Government of the UK takes which steps for helping or supporting different
SMEs in the current pandemic time period.
CHAPTER 2: LITERATURE REVIEW
1. Impact of the corona virus (Covid 19) on businesses
According to Mason (2020), Covid 19 has very negatively impacted to
businesses of all countries and nations. Currently sales ratios and profit margins of
different businesses completely have decreased just because of corona virus pandemic.
In this situation, there are great loss has faced by different ventures of the United
Kingdom as well. Currently hospitality businesses and companies of the United
Kingdom have been fully collapsed, because these companies don’t have customers or
people within the market for selling their hospitality services. This pandemic has
affected to the businesses of other industries and sectors as well, like; retail, travel and
tourism, food and beverage, fashion etc. However, currently large-sized businesses are
able to handle this situation of pandemic, because they have very strong funding
sources. But businesses which come under the SME sector are not able to again run
their business operations in the market place. They require putting their huge efforts for
raising fund in the market place, because currently the UK’s economic is suffering from

the slowdown. There all are some major factors which show the actual impact of Covid
19 on the businesses including SMEs of the United Kingdom.
2. Decision-making process of SMEs in the current pandemic time period
As illustrated by Rapaccini and et.al. (2020) after the Covid 19, the mindset and way of
thinking of people have completely changed, and this is why top-level management of
different SMEs also has started thinking something differently for gaining proper profit
margins in the current pandemic time period as well. When SMEs do not have
customers after pandemic for selling their products, then most SMEs have taken
decision to make changes in products quality and pricing strategies. For example; some
small and medium-sized businesses have started to use proper sanitizer facility in their
workplace for making people or customers comfortable. Basically, these types of
decisions of SMEs can attract many new customers in the market place.
3. Major challenges faced by small and medium-sized businesses due to Covid 19
As per Juergensen, Guimón and Narula, (2020) the major challenges that SMEs in the
UK are facing is deeply unsettling due to worriers and disruption of the economy,
fluctuations in demand and supply, logistics and supply chain issues, consumer
behavior and purchasing power and a high decline in sales. As per the author, the onset
of the pandemic led to lockdowns across the UK which led to closing down of the
physical stores, which mostly consists of the small and medium enterprises. As per the
study, more than half of the country’s economy is stagnant and expect recession while
the other half is extremely weak. There are concerns among the SMEs regarding
defaulting loans, issues with cash flow, concerns and challenges to retain their
employees, a drop in the sales turnover, operating profit and revenue, postponing the
growth projects. There are issues of freezing of the external funding, immense cash
crunch, a high plunge in the creditworthiness and ratings, a lack of recapitalization, high
uncertainties and fear of going of business, delay in lockdown, backlash, inability to
catch up with the online and digital markets etc. (Guimón and Narula, 2020).
4. Key opportunities for SMEs placed and prepared
According to the study by Rowan and Galanakis, (2020) the major threats that SMEs
around the UK are facing are in terms of uncertainty, revenue impact, drop in the

demand and short-term liquidity needs have becomes critical for the survival. However,
SMEs can also grab major opportunities hat the aftereffects of the pandemic has
brought and can be implemented effectively as the lockdown gets lifted. Any crisis
brings about opportunities which have to be grabbed through new ideas, innovation and
entrepreneurship spirit. SMEs can invest more on the surveys and predictions of the
consumer behavior and market and develop products and services accordingly. Any
business that grabs the right direction in the present times can establish themselves
more strongly than the ones denying the change implementation. Innovations have to
be focused upon and use of the government aids like job retention schemes, deferred
VAT, grant funding have to be effectively utilized. The companies have to grab the
opportunities of the online market and start thinking about what future holds for their
business sector, invest more on digital marketing, home delivery services, remote
working, global value chains, complying with health and safety regulation in order to
adjust and sustain with the new normal (Rowan and Galanakis, 2020).
CHAPTER 3: RESEARCH METHODOLOGY
The research used in this project involves a systematic inquiry of the study topic of the
impact of covid-19 on the small and medium enterprises and their implication in the UK
in order to describe, predict, explain observe, study and control the phenomenon
through collected data and findings observed.
Research type: There are mainly two types of research that can be undertaken in his
research study that is quantitative and qualitative study. Qualitative study type is based
on a non-numerical form of collecting and analyzing the data in order to understand
what is meant by the study using deeper insights into concepts and meanings.
Quantitative research type on the other hand deals with numerical data collection and
analysis and is initiated by formation of a hypotheses and the conclusion is either
proving it right or wrong (Peterson, 2019). This study has opted for qualitative data as
researcher believes that by gathering data in words and feelings form, better results can
be developed.
Research approach: There are two research approaches that can be used alongside
either qualitative or quantitative data, which as inductive approach and deductive

approach. Inductive approach is aimed at observing an already occurred event in depth
by analysis of experiences, meanings and for creation of a new theory. On the hand the
deductive reasoning is aimed at the testing or experimentation-based approach and
reasoning of the existing theory in order to verify the already occurred event and come
to a black and white conclusion of the hypotheses, it basically moves from broad
generalizations to specific observations (Woiceshyn and Daellenbach, 2018). This study
has adopted for inductive reasoning as it aims to move from specific observations to
wider generalization of the impact of the pandemic on the small and medium
businesses in the UK.
Research design: The research design is the purpose of the entire research in the way
it is structured, and various designs that can be adopted are exploratory, descriptive
and explanatory. Exploratory research is conducted to explore a group of question,
while descriptive is aimed at explanation of the sample population. This research has
adopted the descriptive design for the study as it aims to describe, explain and validate
the findings along with a description of what, who, where and how (Dewi, Hernawan and
Apsari, 2019).
Research philosophy: There are various philosophies that are used as the
phenomenon to analyses and interpret data to reach to conclusions, such as
pragmatism, positivism and interpretivism. Positivism is the preference of scientific
quantitative methods while interpretivism is based on humanist methods. This study has
used interpretivism as the philosophy because it is associated or suitable with
qualitative research and researcher can interpret data in better manner with this
philosophy. (Ryan, 2018).
Data collection and analysis: There are two sources of collection of data, primary
through first hand surveys, focus groups and interviews and secondary using second
hand researches. Die to the restriction of the pandemic, the questionnaire methods
could not be adopted and the entire research is based on secondary data. The sources
of data range from different authentic journals articles, online articles and newspapers,
government documents and reports, business reports, authentic and published books,
research projects, and other published academic papers. The data was analyzed using

thematic analysis and major themes were created for every major aspect of the study
and inductive reasoning was applied (Corti, 2018).
Reliability and validity: The entire research v=can be deemed as highly reliable as all
the sources undertaken for this project report were highly authentic and trusted
institutions, authors and publications where the extent of the survey could be repeated
and similar results could be obtained. The research was highly valid as al the articles
and references used were after the pandemic started and no old or irrelevant studies
were taken into consideration.
Ethical considerations: All the ethical considerations were taken care of in the
secondary research study and appropriate ethical forms and data storage and
management forms have been attached. No unlawful or unethical actions were taken in
the entire duration of the stud and three were no conflicts on interests.
CHAPTER 4: RESEARCH AND FINDINGS
Themes
Theme 1: Corona virus (Covid 19) pandemic
Currently the entire world is facing very bad impact of corona virus. In the beginning of
2020, the first case of corona virus infection was found in a city of China, named;
Wuhan. From that date to till, cases of corona virus are increasing day to day, and this
is why most of people are avoiding to entre in the marker place to protect own self from
the infection of corona virus. In this dynamic world, existing people has never seen
before this type of pandemic (Pantano and et.al., 2020). There are market places of
many countries has completely collapsed due to this pandemic, because there are no
people within the market place for buying products and services. Due to having lack of
customers, there are many ventures has been closed, and this is very bas impact of this
pandemic on different ventures and business. Currently this pandemic is infecting
people in the market place of United Kingdom, and this is why there are many corona
viruses active exists in the national boundaries of the UK.

However, UK’s national health service authority is taking many innovative as well as
productive steps towards protecting locals from this pandemic, and this is why currently
many people within this country are recovering from Covid 19. The UK government has
imposed some strict rules and regulations on existing businesses or ventures as well in
order to stop the spread of corona virus (Ratten, 2020). However, many of venture are
gaining appropriate profit margins in current pandemic time period as well. But due to
this pandemic, mots businesses of the United Kingdom become completely closed.
Majorly this pandemic has badly affected to travel & tourism, hospitality, food &
beverage and transportation industries in the UK, and businesses which works under
these all industries are currently not able to run their business operations in proper way.
Theme 2: Small and medium-sized businesses of the United Kingdom
In this modern and dynamic world, the UK is one of the richest countries in the world, in
which existing small and medium -sized businesses plays an excellent role in making
effectiveness of this country at the international level (Cairney, 2020). Basically, this
country’s small businesses are giving great contribution in overall development of
economy and GDP (gross domestic product), and these is why businesses of small and
medium sized category are very valuable for this country. Currently total 5.9 different
businesses are running their operations in the country, in which 5.8 are only small and
medium-sized businesses. It means, total 99.3% businesses in the UK comes from
small and medium sized category of businesses, and this is why anyone can simply
analyze the great impact of these venture in economic development of the United
Kingdom.
People or entrepreneurs who runs different small and medium-sized venture in this
country are also facing many troubles due to corona virus. Basically, pandemic of Covid
19 has badly affected to most of small businesses of the United Kingdom. These
ventures don’t have customers right now in market place to sale their products and
services (Gourinchas and et.al., 2020). Due to this pandemic, people god scared, and
they don’t want to unnecessarily visit in market place, because are thinking that, if they
highly visit in market place, then they can be infected from corona virus. However. Top-
level management in some small ventures has seen this pandemic as a business

opportunity as well. For example; now customers like to consume such food and
beverage products and services which has an excellent packaging, because proper
packaging of products always makes safe to people from pandemic. This is why most
ventures are gaining huge profit margins in current time period as well by providing
products and services to customers in proper packaging.
Theme 3: Government’s approaches to systematically deal with pandemic
The local government of the United Kingdom knows about bad or negative impact of
corona virus pandemic on the nation, and this is why it is taking different productive
steps and making various productive approaches for systematically dealing with this
pandemic. Basically, involvement of government is very mandatory to resolve the issue
of Covid 19, because it is not favorable for economic development of a country (Che,
Du and Chan, 2020). When the first case of corona virus was found in the country, the
government this nation become very active, and has started to conduct different
activities and operations for protecting locals from the corona virus pandemic. For
example; the UK government was imposed the rule of lockdown on people or business,
and this rule was influenced to people or businessman for making own self isolated to
be protected from the corona virus infection.
Due to the rule of lockdown, all small and medium-sized businesses and ventures was
also not able to run their business operations in the market place, and this is why there
was many ventures has terminated their employees or worker because of lack of fund
and income. This pandemic was affected to all types of people, because due to zero
income, many employees of small and medium-sized ventures was lost their jobs.
However, after few months of lockdown, the government has realized that, if it will with
the option of lockdown for protecting, then its economy will be badly affected in the
future, and then the government was given permission to all local enterprises or
businesses for again start their operations of business in the market place, but with
using proper precautions of corona virus (Barreiro-Gen, Lozano and Zafar, 2020). After
this permission, many of small and medium-sized ventures are successfully running
their business operations in current pandemic time period as well.

Theme 4: Actions and steps of small and medium businesses to handle the
pandemic situation
Top-level management within almost all ventures are taking various productive actions
and making effective action plan for smoothly handle the situation of pandemic. For
example; different ventures are now started to provide proper facility of sanitizer to
customers and their employees, because currently most people or customers like to buy
products and services only from those ventures and businesses who has properly
followed all guidelines of Covid 19. On the other side, upper management within many
small and medium-sized ventures are encouraging their employees for always wearing
masks to stop the spread of corona virus, and this is a great step to motivate customers
for visiting in the market place to buy products and services.
On the other side, many businesses have started to use thermometer as well in
workplace for regularly check the temperature of all employees, customers and visitors
(Salamzadeh and Dana, 2020). Currently small and medium-sized ventures which
works in the UK’s food and beverage industry also become very active in order to sale
many unites of product in current pandemic time period as well, and this is why they has
started to offer their food and beverage products and services in proper packaging.
These types of actions and steps are very valuable and important to a small and
medium-sized businesses for gaining huge profit margins in different segment of
market.
Findings
On the basis of above findings, the corona virus pandemic has badly affected to
different businesses and ventures in the United Kingdom, but top-level management of
many business has found some productive strategies to smoothly run own business
operations in the current time period as well. Of course, this is tough time period to
small and medium-sized businesses of the UK, because there are only few customers
in the market to sale own various products and services (Ozili, 2020). In this situation,
upper management of a business have to be some creative as well as innovative for
systematically dealing with various issue of corona virus pandemic, because it is very
important raise appropriate profit in current pandemic time period as well.