John Fisk, a managing partner at PwC who leads the national restructuring practice,said the lockdown "hibernation" period and wage subsidy meant the worst was yet to come.
"The businesses that were vulnerable pre-Covid are the ones that have experienced the most difficulties first [and] startups that are still in their growth phase and need funding. That's the sort of work that we are seeing at the moment.
"My concern is what happens next, and particularly over the next two or three months. The wage subsidy has effectively been used."
Liquidators' reports reveal at least 13 businesses failed partly because of Covid-19's impact, Stuff reported, including those in construction, a travel agency, and a Christchurch hospitality chain.
Another to shutter is Parnell restaurant 46 & York. Owner Dana Johnston has said the cumulative effect of the seasonal downturn of winter after lockdown and uncertain economic times were factors in putting the business into liquidation.
"Six years of blood, sweat and tears went into 46 & York," Johnston said. "The decision was certainly an emotional one and one I believe to have been a last resort."
Parnell restaurant 46 & York has shut for good. Photo / Supplied
Fisk said about 150 businesses went into liquidation every month, and Covid-19's impact on those numbers was yet to be seen.
"I think there will be an uptick. And we haven't seen that yet, largely because we have been through level 4 lockdown and effectively that has almost been a hibernation for a lot of businesses."
Banks had been supportive in providing short-term credit, he said, and the Government's wage subsidy had been another big factor.
"We don't know if there's going to be any extension to the scheme but I don't think it will be as generous as it has been," Fisk said. "[And] banks will need to put their borrowers to more of a test ... because they can't just continue to put debt on the balance sheet."
The wage subsidy scheme allowed qualifying organisations to claim more than $7000 for a full-time employee and $4200 for a part-time employee, with the total amount for all covered employees paid in a lump sum to cover a 12-week period.
Applications opened from March 17, and those who get the money must retain employees for the duration of the 12-week subsidy, measured from the date of the application. For example, if a business applies on April 7 this period ends on June 30.
More than 1.7 million people - 60 per cent of the workforce - are covered.
Changes to insolvency and company law will be made as part of wider Covid-19 response legislation currently before Parliament. Those include putting debt into "hibernation" until companies can trade normally again, and creating a "safe harbour" for company directors in regards to their insolvency-related duties.
The Government has also announced a scheme to provide interest-free loans for a year to eligible small businesses - which Fisk likened to giving sugar to the malnourished.
"They need it, but they also need a balanced diet - you can't just keep on loading debt onto companies to provide liquidity, there needs to be other levers pulled. And I think it ultimately leads to choices having to be made about who will survive and who won't."
The closure of New Zealand's borders has hit tourism companies particularly hard. Photo / Jason Oxenham
In April, more than 1000 people a day went on to a main benefit and there were 184,404 people on a Jobseeker benefit at the end of the month - a jump of 32,600 in four weeks.
The business community is keenly anticipating what further support will be announced in Thursday's Budget. Finance Minister Grant Robertson this week told a pre-Budget event that the economic outlook was sobering and reflected a one-in-100-years shock.
Fisk said it was impossible to predict how many businesses would go under.
"We are really into uncharted territory here. We have never had a downturn, I don't think, that has affected businesses across the board. Unless you are in the healthcare area or supermarkets, just about every business is going to be impacted in some way."
Businesses that survive would be those that react quickly, he said - and some could eventually emerge stronger.
"The important thing for business owners is to be proactive about addressing the problems and having a plan for the future. There's an old saying about plan for the worst and hope for the best - and I think that's an important lens to put on this for business owners, to hopefully get through this and perhaps look for a new structure that might be even better in the long run."
