Texas Border Business
Today, we released the second MetLife & U.S. Chamber Small Business Coronavirus Impact Poll.
The survey of 500 business owners was conducted April 21-27 and paints the stark economic reality of COVID-19. Almost one-in-three businesses are temporarily closed, up from 24% in the prior month, and more than one-in-five small businesses are two months or less from shutting down permanently.
The poll shows that small businesses are facing a cash crisis. For the first time in the survey’s history, less than half of small business owners (48%) are okay with their current cash flow situation.
Many small businesses are turning to the Paycheck Protection Program (PPP) for a cash flow solution. One-third (32%) of small businesses applied for a PPP loan, and 13% report they are planning on applying. Interestingly, when asked about the importance of a PPP loan to keep their business open, small businesses are split: 47% report that PPP loans are critical, and 46% say they are not.
In addition to looking for cures for the cash flow ailment, small business owners are increasingly innovating their way through the pandemic. The poll reports 20% of small businesses transitioning some or all of their employees to teleworking, up 8 percentage points from the previous month. And, 17% have transitioned their retail presence to be more virtual or digital, up 7 percentage points from the end of March.
Flags of Valor (FOV), in Ashburn, VA, is a good example. Experiencing a loss of two-thirds of their revenue in March, the company was forced to furlough half their team. Co-Founder and owner, Joe Shamess, recently was approved for a PPP loan after missing out on the first round of PPP funding (the original $349 billion in PPP loans ran out on April 16th). He is hiring back all of the combat-injured veterans who manufacture the sourced-in-America wooden flags and is bolstering the salaries of his skeleton crew who remained and experienced 50% pay cuts.
The additional liquidity provided by a PPP loan will help and so will creativity. FOV realized that patriotism, a key customer attribute, is alive and well in the midst of the coronavirus crisis. Why not continue to align FOV’s mission with patriotism while satisfying the needs of families to enjoy quarantine-at-home craft projects? And so, FOV’s Flag Build Kit was born.
Flags of Valor’s experience is mirrored throughout the country as small businesses struggle to stay afloat. Do you have an example of how you are innovating your small business through the pandemic? If so, please let us know by e-mailing me at tsullivan@uschamber.com.
– Tom Sullivan, Vice President, Small Business Policy, U.S. Chamber of Commerce Â
