Coronavirus - a horticultural crisis
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Many non-essential retailers have been forced to shut because of the coronavirus.
For most, this is a costly necessity. They cannot expose staff and customers to the risk of contagion, and the need to shut the doors until the crisis is over is impossible to argue with. Lives are at stake.
But for the horticultural sector, the shut down is nothing short of a disaster.
The closure of the UK's 2,000 garden centres and nurseries as ‘non-essential’ during the key early spring season means that any business involved in "ornamental horticulture" cannot trade during their busiest period.
Garden centres cannot open - while growers have no outlet for their plants. This means that millions of bedding plants, shrubs and even trees will have to be binned in the coming days and weeks as they pass their selling-on date.
It is particularly serious for the sector as there is no scope for storing living plants.
It could mean ruin for UK growers who are potentially facing a loss of their entire 2020 income. The main trade asset of ornamental plant growers' is their inventory of plants - with nowhere to sell them, many producers will have no alternative but to go out of business.
Up to a third of producers could go bust, as retailers cancel orders that they cannot sell on.
What can you do about it?
The closure of garden centres due to the pandemic comes at the worst possible time - the value of stock during the key spring trading period is typically three to four times the year-end value of most businesses.
It is particularly frustrating as the UK’s 23 million gardeners are spending more time in their gardens, and desperate for the plants they cannot buy.
One partial answer may be online sales. Setting up a website to order plants may be a costly proposition, but it may be the only way to salvage the season.
The costs involved include:
- Creating a website to allow online orders - or showcase plants for telephone orders
- Marketing - to get potential customers to the site
- Setting up delivery systems - vans and drivers may need to be found
All will be required at short notice which could force up the costs. However, there could be some sources of cash.
Local grant funding could be available for many small horticultural businesses that currently qualify for Small Business Rate Relief (SBRR), a grant of £10,000 will be paid automatically by the local council.
Your local authority will contact you in the early part of April with the details of what you are entitled to. If your business has a rateable value between £15,000 and £51,000, the local council grant could rise to £25,000.
However, you may need other types of funding - and need them immediately.
The Coronavirus Business Interruption Loan Scheme - CBILS
Grower or retailer, you may be eligible for the Coronavirus Business Interruption Loan Scheme (CBILS).
This could let you borrow up to £5m, interest-free for 12 months, with the government promising to underwrite 80% of the loan should a business fail.
You can apply to lenders directly – but a better solution may be to call us at Rangewell, where we can use our expertise to help you secure the funding you need.
The CBILS facility can support many types of lending. Most popular is likely to be cashflow support which can provide a reserve of cash to tide a business over while income is reduced. You can borrow from £1,000 - £500,000 – or up to £5m through the Coronavirus Business Interruption Loan Scheme.
We may be able to secure the funds you need in a matter of days
If you are keeping your food business open through the crisis, you will need to take all the necessary steps to be compliant with guidance without delay. You will then need to look at your financial needs - and, at Rangewell, we are ready to help.
Whether we can help you find the answers to your needs with a loan under CBILS, or need more extensive answers such as Asset Refinance or even a remortgage to keep your business blooming, our team is ready to help.
We know all the lenders in the markets, and we can work with you to find the most cost-effective answers to your funding needs. During the current crisis, we can provide the quickest way to find the cash you must have to survive.
Call us now – we understand the pressures you are under in the horticultural business – and our service is absolutely free.