Current state and needs of Ukrainian business during the full-scale war: main results of business survey in June
20 June, 2022
Center for innovation development, Entrepreneurship and Export Promotion Office, Diia.Business project together with Advanter Group conducted a survey on the current state and needs of Ukrainian businesses during the full-scale war.
Survey period: 25.05–10.06.2022. A total of 877 business owners and CEOs participated in the survey. Generalizations are made on the basis of data from the State Statistics Service for 2020 and 2021.
Key results of the survey
1. Current state of the business:
46.8% of enterprises have completely or almost completely stopped working since February 24. At the same time, 4.5% indicate that they found an opportunity to even increase turnover, compared to the pre-war period.
The majority of Ukrainian businesses take an active part in the fight against Russian aggression:
- 93.4% — involved in helping the country during the war;
- about 70% are directly involved in volunteer activities.
2. Business losses during the full-scale war
- Direct business losses: about $85 billion — total direct business losses for three months of the war (this indicator is a generalized self-assessment by business of direct losses without taking into account indirect ones).
Loss of personnel (compared to 23.02):
- 20% — reduction or more than 1 million employees (part transferred to the Armed Forces)
- 20% — sent on vacation
- 27% — salary cuts
Relocation: 19% businesses were forced to relocate.
3. Business expectations
48% — volumes of products sold in 2022, compared with 2021.
65% expect to continue working and receive income. Among them:
- 50–80% — 30% of 2021 volume
- 10% — around the level of 2021
- 5.6% — more than 120–150%
Only 33.5% — will not resume or almost will not resume work till the end of 2022 (currently about 50%)
Focus on export: 43.6% are focused on the development of exports
4. Adaptation to the shock of war and the availability of development strategies
- 33.4% have already adapted and have a strategy;
- 50.5% — in the process adaptation and intuitive management;
- 11.1% — do not see the point in the development of business strategies, business development plans taking into account new realities.
5. Need for financing
- The total financing needs of SMEs are $74 billion.
- 41% of enterprises consider finding financing a priority.
6. Expectations regarding tax solvency
- In case of availability of resources for the implementation of development strategies, the business will be able to pay the same amount to the budget and even a little more than was planned for 2022 before 24.02.2022.
7. What prevents business from recovering:
- The scale of the unmet need for resources for development is growing.
Respondents chose the top 7 obstacles from the options. Their rating:
- Lack of a sufficient number of solvent customers in the domestic market — 62%
- The unpredictability of the development of the situation in Ukraine and the domestic market — 48%
- Lack of sufficient capital — 43%
- Unforeseen actions of the state that can worsen situation with business — 29%
- Unavailability of credit funds, loans etc. — 28%
- The breakdown of supply chains — 26%
- Inefficient, long, expensive logistics — 23%
The publication was prepared by the Center for innovation development, Entrepreneurship and Export Promotion Office, Diia.Business project together with Advanter Group with the support of the European Union, the Ministry of Digital Transformation, the Ministry of Economy, the Ministry of Finance, the Ministry of Community and Territorial Development and the Coalition of Business Communities for the Modernization of Ukraine and the USAID Program “Competitive Economy of Ukraine”. The publication reflects the position of the authors and does not necessarily reflect the opinion of the European Union.
The study was prepared within the framework of the Initiative for economic recovery, development of entrepreneurship and export of Ukraine.