in the workshop

local 13th street business owner seen running naked with hair on fire

5 minute read 

Fake news is nothing new. Tabloids have been grabbing our attention for as long as I can remember. In as much as the modern fourth estate would like to deny their bias, what we are served is often sensationalized because of an insatiable twenty-four hour profit driven cycle. So while I ask forgiveness for stealing your attention, I also request a few short minutes to offer you an inside view of how your support of our small business is playing out.

Right now you might be hearing a lot about the SBA, PPP and taxpayer funded bailouts that are worth trillions of dollars yet to be printed. We the people are being sold the concept that these stimuli must be funded to jump start the economy and get everything moving again. I think most of us are afraid of what a recession might bring, and not knowing what we are to do next, having the government step in feels somehow necessary. To that point, let me state up front that duross & langel has applied for the Paycheck Protection Program (PPP is calculated by 2.5 times your monthly payroll). If approved, this idea is to fund payroll for eight weeks, pay rent and utilities. We applied because during those eight weeks, if our payroll does not dip below 75% of what was paid in 2019, we can request loan forgiveness. The term of the PPP loan is 24 months with no payback for the first six. The loan forgiveness part is what appeals most to everyone, that’s the hook, but no one has really explained how forgiveness will occur. You with me so far? Great, because the next part is where I begin to get squirmy.

beware the jabberwock, my son 
the jaws that bite, the claws that catch! 

Having a small (free?) loan that will catch us up on rent and salaries is great for us but it might truly screw a good amount of mom and pop businesses. Let me break it down this way: duross & langel has a robust online business that not only allows us to sell our products while everything is shut down, because (weirdly) we make and sell the very things one might need in the event of a viral pandemic. Our online costs are not free and easy but certainly worth every dollar we pay (average shipper cost is $14) and packaging (average cost $3) per piece. Forget the rent for the moment. Forget salaries. Neither are being paid. Sarah and I have been working without pay because that’s what you do when you own a business and things get bad. Period. Unlike so many others, Sarah and I are fine for the moment, but eventually our landlords are going to want their rent money. Assuming we reopen the store in mid to late May, life will not be what it once was. With a level of acceptance that surprises even me, everything in our store is being changed so that we can accommodate social distancing. While we will still encourage shopping to be done online with delivery or in-store pickup, pre-shopping will become the 2020/21 norm. In other words, look online, put a list together, come in to the store for a sniff and behave as a dedicated shopper (get in-get out). New store hours will be limited because without the volume of traffic, the ability to afford part-timers evaporates. We will also need to ship and produce while concurrently running the store. Sarah and I have made peace with these realities. We’ve been through tougher times before. As long as we have our health, we can maintain until the paradigm shifts to a post pandemic model. For now, nothing will be back to pre pandemic levels for quite a while (restaurants, social shoppers, people in town for concerts, sporting events and conventions..) At a certain point, like most businesses, if demand were to diminish past 50% of 2019, we couldn't stay open. At this point we are still ahead of where many other small businesses find themselves. In the end however, everything negative creates a ripple effect. Something every business will be experiencing in the not so distant future.

In order to qualify for the PPP, restaurants will have to bring back at least 75% of staff for at least eight weeks. With social distancing protocols in effect, most restaurants will have a fill capacity of no more than half pre-pandemic while bar business (where a good chunk of their money is made) will tank. Assuming anyone still wants to go to their local eatery while there is no vaccine, no herd immunity and we are all thinking about what we're breathing in while eating in public. Like most small businesses, restaurants live on a thin financial existence. PPP takes care of some of the staff overhead for a short time but it leaves little left over to cover rent and utilities, especially when you are already two months in the hole from lockdown. Salons will be fine. Tough as it might be at first, salons will make up the difference quickly. With the exception of a few guys who bought clippers and buzzed their heads, the majority of the salon business is sitting at home champing at the bit to get an appointment. Most smaller mom and pop shops fall somewhere in between. Many, if not most, will never fully recover.

success is stumbling from failure to failure with no loss of enthusiasm

Having opened and closed several businesses, I am no stranger to failure. It is an innate component of small business and nothing to feel ashamed about. Statistically most small business do not survive. According to data from the U.S. Bureau of Labor Statistics, about 20 percent of small businesses fail within their first year. By the end of their fifth year, roughly 50 percent of small businesses fail. After 10 years, the survival rate drops to approximately 35 percent. Throw in a global pandemic, a depression and/or a natural disaster.. it skews the numbers sky high. The financial pandemic, like the virus itself, will first kill off the small businesses that are weakened by preexisting conditions like high debt to income ratios, unworkable business models, bad management.. and then older/young businesses that are just not strong enough to survive the losses. Many will blame their closure on the pandemic. Most would have failed in the long term, but this sadly hastens their demise. Feelings aside, it is simple arithmetic.

Small business have become the partisan hot potato of the moment. I would suggest you not allow yourself be pulled into that emotional argument. The politicians are writing the gospel of small business while the press are spreading that narrative like a million tiny apostles. They are vilifying some larger small businesses, who also have employees who need to feed their families, for taking the PPP. I agree that publicly traded companies should find their own funding but you make up your own mind. It’s not for anyone else to form your opinions. Small businesses are important when they fulfill a public need/desire. When that desire wanes, businesses go away.

After sixteen years in business, Sarah and I remind one another to be encouraged by the support you’ve shown for the work that we do. It is in our DNA to run our business as if at any moment it could all go away. It helps us to attach to the daily result rather than some shallow, elusive idea of success. The relationships we form with you and the things we make are everything. When I think of my friends in business, I know that good, talented, smart people will always find a way. Some places are sure to close but creative people always reinvent themselves. New places will blossom. I know this from personal experience. My enthusiasm has never diminished.

Change can be difficult. It can feel uncomfortable. Like Alice falling through the looking glass, the process of change and a different view point changes our connection to the world around us. Perhaps this new point of view will teach us things that ultimately create a better world for everyone. In the end, it won’t matter what we wanted. What will matter is what we did with the things we had.

I wish you all health and love and joy. Please donate whatever you can to your local food bank. Looking after one another with care and kindness is the most important thing we can do.