Big File: Business Crisis, three small rounds and then…

More than ten years after a global crisis, those of subprimes, the pandemic is cracking business models already marred by an unfinished, even painful digital transformation. If some sectors do well, many activities (culture, catering, clothing, etc.), hit hard by the slowdown or even the total cessation of activity, will not have the strength to recover.

In a context already weakened in recent years (Yellow Vests, SNCF, pensions…), for sectors that can, the time has come for an accelerated version of renewal, and, at a minimum, for the sustainable improvement of their operations. An inevitable survival strategy, with an extremely limited time scale.

I – Taking the accompanying package

During the lockdown, the Nouvelle-Aquitaine Region was one of the most prolific regions to implement support measures for companies in difficulty. Thus, the emergency plan, in addition to the various state measures, amounted to €90 million, with the addition of numerous aids to support regional businesses, reaching €250 million. Most of this aid is still accessible online, identifiable through the dedicated platform, the Guides des Aides de la Nouvelle-Aquitaine.

In addition, the Region quickly set up a psychological support platform available to professionals. The challenge is indeed to preserve or at least limit as much as possible the inevitable fall in cash flow, such as arming oneself with patience, mental resistance and financing, as far as possible, and this, in the duration of what promises to be a trying marathon.

It is therefore without a state of mind, if the company can claim it, that it is necessary to compensate as best as possible for cash shortages, while preparing or even creating the recovery.

Seek investment to get back on your feet and move forward

To this end, companies that meet the criteria and that can consider investments that ultimately generate growth, are invited to subscribe to all possible financing. Bank loan, financing via the BPI, regional loan… Between measured investment and necessary risk, the status quo will not allow us to move forward, or hope to “survive”.

On the regional side, Nouvelle-Aquitaine has set up a loan fund to the tune of 20 million euros, in association with a bank loan, to support VSEs and SMEs. Advantageous conditions including a zero-interest loan without guarantee, for an amount that can go to € 300,000.

Among the privileged sectors of activity, cultural industries, JEI (young innovative companies), the wood sector, tourism… A condition of existence of more than one year is necessary, as well as the presentation of an accounting balance sheet.

Save time, a survival strategy that allows you to question

All companies can be supported, even those that do not meet the criteria of the previous possibilities. In addition, the Nouvelle-Aquitaine Region has set up an emergency support fund amounting to €15 million. With assistance in the form of repayable advances, or grants.

The amounts vary from €10,000 to €500,000, depending on the sector of activity selected, and the number of employees. The idea is to really support this delicate situation, for companies as well as for the employees concerned, and therefore the economy more generally.

The idea is thus to be able to hold, as well as to prepare the recovery, by relying on the components thought by the government; ecology, competitiveness, cohesion… Industrial companies are thus particularly honored. The Ministry of the Economy, Finance and Recovery offers a complete guide for them.

In Nouvelle-Aquitaine, the focus is particularly on the modernization of the automotive, aeronautics, defense, energy and digital sectors. Calls for projects at state level are updated regularly online. They make it possible to detect specific growth opportunities, or at least to increase the visibility of its offers.

INTERVIEW

Interview with LaurentDEVERLANGES
, Director of Caviarde
Neuvic

II – Which sectors are escaping the crisis?

From lockdown to lockdown, between forced adaptation and abrupt shutdown, the economic future may seem bleak for many leaders. Of course, the sectors affected by administrative closures, because of their risk or their “non-essential” nature, are particularly affected. Already last June, the OFCE estimated a fall in value added in France of more than 30 points. Placing it among the most affected countries, along with Spain and Italy.

A vast ocean of sectoral economic difficulties

For service professions, the implementation of teleworking encourages the continuation of activity, but not all sectors are suitable for this transition in practice. There may be a decreased productivity effect on the one hand, or costs to be absorbed for implementation. On the other hand, customer acquisition is impacted by the lack of direct contact. Of course, we can quickly digitize this acquisition, but are customers ready? What about consulting professions, local professions, jobs with heavy investments requiring an “in person” visit?

In Bordeaux, catering in particular is suffering terribly. Tourism too, even if the summer was relatively mild by the sea… Business tourism has, ipso facto, not restarted. Air traffic thus envisages a return to normal only within a few years… As for independent businesses, structurally fragile, they have not compensated in a few weeks for the large losses due to the confinement. As Christmas approaches, the situation is more than worrying.

The big “winners” of the lockdown

Conversely, food, real estate, luxury… But also logistics, to a certain extent, for shipments, in particular… The “sport at home”, the purchase of equipment… All these sectors, at the cost of a digitalization already begun, or accelerated, have done well in the current crisis.
Overall, the sectors related to agri-food, health (de facto), energy, and financial services continue to show encouraging results. However, it will take hindsight, once the health crisis is over, if not the end of the economic crisis, to fully understand the consequences of this exceptionally long period.

Business insolvencies due to COVID-19 in France

Interview with Sophie DESMAZIÈRES, Founding President of Local Offices

III – To be accompanied, during and after the crisis, an imperative

Beyond the already digitized companies that have been able to focus on the organization of teleworking, the optimization of the platform, the care given to a reinforced local service, with a lot of human availability, other SMEs have suffered the full brunt of non-anticipatory consequences.

Leaders have had to (and still have to) readjust, while taking into account the lasting impact of the sociological lockdown, and the sustainable reorganization of work. For some, it is their entire business model that is being questioned. In this period, more than ever, the support of leaders is essential.

A suspension of merger operations, hiring… and the focus on buyers

Interview with Yoann Melloul, In Extenso Finance and Transmission

Between massive teleworking and isolation, adapt to a half-hearted activity, or even non-existent.

Interview with Jean-Philippe Romero, President of the Fiduciary Company and member of the Perspectives Circle

The World After has not yet arrived. We are in a particular temporal space with profound changes already underway (meaning of work, teleworking, acceleration of digitalization…). In this “non-space”, the health crisis continues to rage, as well as uncertainties, day after day. At the same time, some can already learn the lessons of the first semester.

The economic crisis has only just begun. That of 2008 is already anthological, and not companies have not recovered. Certainly, the strongest have “cleaned up” themselves durably, the free play of competition has erased some prices … However, at the time, the commercial levers were more noticeable.

To date, the current crisis also places the French economy in front of its inconsistencies, or at least its shortcomings, in a digital environment that is too easily forgotten globalized. With a “strike force” of the pioneers of the digital economy that cannot be matched in a few months… Especially since the playing field is international, facing a national market.

In this context, to pass the course, sustainably, perhaps it is necessary to take the time, if we can, to return to the fundamentals of the value proposition of current business models. And failing that, (re)invent the business models of tomorrow, based on the values expected by customers in the light of the health crisis.

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