Struggling coronavirus victims: small businesses on life support

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For city leaders and residents alike, Redwood City’s core identity has been wrapped up in being the entertainment capital of the Peninsula, a destination alive with bars, restaurants and theaters. Overnight, the coronavirus has brought back a vampire specter no one imagined could ever return: Downtown “Deadwood City.”

Misery has company, it must be said, and neighboring cities with thriving downtowns a couple of months ago are in exactly the same boat.

For restaurateurs and retailers, for the self-employed in offices and contractors working outdoors, the coronavirus and the response to it have been devastating. Two months into an abrupt shelter-in-place closure, many business owners whose revenue took a nosedive are struggling to pay rent and make payroll and wondering how they’ll survive. Though government and community members are trying to throw these flatlined small businesses a lifeline, the economic undertow is powerful.

Take Ron Brown, 75, for example. He began in the flower business with his dad at the age of six and with his wife owns Redwood City Florist on Woodside Road, next to Crippen & Flynn Funeral Chapel. Bay Area funerals are limited to 10 people or fewer, and this normally large part of the Browns’ revenue has virtually disappeared. Their son, daughter and a grandson are the paid staff.

Sales in March and April were down about $40,000. A $4,000 wedding planned for five days after the shutdown got cancelled. Administrative Assistants’ Day came and went uncelebrated April 22. “We always do Woodside and Sacred Heart (graduations),” Brown says. “They order big arrangements for the stand. All the proms and the spring dances were all cancelled and we do maybe 300 or 400 wristlets over the course of a couple of weeks. … If something doesn’t happen pretty soon,” Brown says, “if we miss Mother’s Day … I don’t know if we’ll be in business in June.”

This story was originally published in the May edition of Climate Magazine. To view the magazine online, click on this link.

Family-owned Plaza Florist & Gifts in San Carlos has been able take orders by phone at home, create the flower arrangements at the store on San Carlos Avenue and then drop them off. They’re mostly small birthday or “thinking of you” bouquets, says florist Jill Naghdchi, not big orders like weddings and graduations that pay the bills. The store had to lay off two employees. In business since 1985, “We’re taking it day by day,” she says.

As government officials look at reopening the economy, many business owners say there needs to be more flexibility for individual businesses who are able to operate safely.

Though he has understanding landlords, J. Vincent is struggling to pay his apartment rent as well as for his Hair Loft space on Broadway, near City Pub in Redwood City. He thinks hairstylists should be classified as “essential” businesses. Furthermore, they are state-licensed and must meet high sanitation standards. “We wash our hands more than the average person,” he says. “We wash heads. We cut hair. We’re not kissing clients. … My salon is only a five-station salon. I have six feet of space (between them).”

He applied for a federal loan, but like many small businesses, got squeezed out when bigger companies got in before the first round of funding ran out. “We’re all in it together,” Vincent says, “but for me, I’m fearful that I might lose my business. I’ve worked so hard to have good credit and that’s going to go down the drain.”

Losing Event Income

Even if other stores start to reopen, until people flock to downtown Redwood City for entertainment and events, things will remain slow at Busy Baby Bottoms/Stuff on the Square, a small specialty store in a kiosk on Courthouse Square. Angela Rogan has been the co-owner with Realtor Greg Garcia for two years.

“The summertime is our biggest revenue and with that it usually sustains the store through the winter months because we do so well (with) summer concerts, the events,” Rogan explains. “The Fourth of July (parade and festival) is a big revenue maker for us. In fact, the Fourth of July will pay for our insurance for the whole year. And all these activities and events have now been cancelled and at this point I’m very worried.”

She has a second job as a waitress but says it will put a strain on the family budget to keep the store afloat until crowds come back. “It’s going to be a vicious, vicious year,” she adds, “because not everybody is going to come out even if they loosen the restrictions.”

In San Carlos, the uncertainty about special events has put the Chamber of Commerce itself in “a bit of a bind,” according to Tom Davids, a former mayor who is now its part-time interim CEO. About 60 percent of chamber income comes from events, including an October art and wine fair.

Not knowing whether the state will allow “people wandering around without a mask” by then makes it difficult for the chamber to plan, Davids says. “We have some question how we’re going to raise the money we need to keep the doors open.”

There Are Winners

In every crisis there are unexpected winners. And owners who get creative and adapt.

Business at Ralph Garcia’s vacuum and sewing machine store on Main Street in Redwood City has “actually been gangbusters,” he says. “We’ve sold more sewing machines in March and April than in the previous six months. Everybody’s dragging out their machines to make masks.” About 1 ½ years ago, he bought a large quantity of fabric and has been able to sell mask-makings too. “I find it hard to believe there’s still a shortage of masks the way they’re cranking them out,” Garcia says.

Peter Borrone and his wife initially shuttered their popular Vesta restaurant on Broadway but were worried about their employees and reopened two weeks later for takeout. They’ve only been able to bring back four of 18 servers, but all the kitchen staff and dishwashers are at work. Chairs and tables have been rearranged to facilitate pick-up by DoorDash-type services and customers, and a few kid-friendly items have been added to the menu.

Not knowing what to expect the first night they reopened, Borrone was at home fixing dinner when a staffer called and said he needed help. “When I drove up there were people six feet apart, but they were down the block,” he says. “They were on that side of the street. They were sitting in their cars. They were everywhere. It was amazing support.”

City and business organizations have jumped in. The Redwood City-San Mateo County Chamber of Commerce initiated a “Feeding Our Local Heroes” campaign to deliver restaurant meals to hospital staff and other essential workers. Funds to buy the lunches and dinners come from community-minded corporate and individual sponsors. By late April, about 1,100 meals had been delivered.

Dani Gasparini, a former mayor, has helped match recipients and restaurants. It’s a way to thank the workers who are keeping essential services going and also keep chefs and other restaurant staff on the payroll. “The winner in it,” she says, “is really the restaurant.”

$1 Million to Start

Local government is trying to help. The San Mateo County Board of Supervisors allocated $1 million for small businesses in the county through the San Mateo Strong Fund. Grants are being administered by the San Mateo County Development Association jointly with the San Mateo County Credit Union.

At a $10,000 maximum per grant, that translates to money for 100 business across 21 jurisdictions, SAMCEDA’s executive director Rosanne Foust told the supervisors. Since the initial outlay, a growing number of cities have been adding to the fund to help their own businesses—$1.3 million and counting. Redwood City added $300,000, Foust says, so on top of the grants made countywide, “we can save at least 30 (Redwood City) businesses if not more.” Applications opened April 27 and the number of businesses applying far exceeded available funds. The small business grant portal has closed and the applications are being reviewed for funding.

“We’re trying to get corporate donors, any residents who want to donate to it, high net-worth individuals, whoever we can get,” adds Foust, who is also a former Redwood City mayor. “If we want to keep these small businesses which really matter to us open, then we’ve all got to be dialing for dollars.”

She and her staff put in long days to gather information for the SAMCEDA website on loans and grants available to businesses, legislation and other vital topics. San Mateo Strong had to be built “from the ground up” in less than three weeks, she adds. “There’s no other mechanism that is out there to really get money to small business quickly.”

Don Burrus, Redwood City’s economic development manager, enlisted librarians to call the city’s 6,600 business license holders to find out what they need and offer information. Burrus had personally handled more than 300 calls and emails from often desperate business owners, especially after funds from the initial bailout legislation had been exhausted.

“I definitely think that it’s going to be very difficult for all businesses, not just Redwood City but every business in the United States to try to recover from a lack of revenue generation certainly for 60 days,” Burrus says. “It’s going to be tough for everyone.”

Mayor Diane Howard made phone calls to the management companies at Sequoia Station and the downtown cinema asking them to cut their tenants some slack. All businesses may not survive, but she hopes the city can provide encouragement and resources “that they’ll see the light at the end of the tunnel.”

Real Recovery

Ultimately, though, real recovery hinges on getting back to work, and pressure to reopen is increasing, especially as other states greenlight their businesses.

Foust participates in a thrice-weekly call with city, county staff and business leaders, and she has been advocating for residential construction to be allowed to continue. The county-led group, Foust adds, is starting to focus on what can be opened and when. “They want to do this but they want to do it in the safest way possible.”

Howard sympathizes with residents who got caught up in the shutdown while remodeling and are living with an unfinished bathroom or a wall that wasn’t closed up. Others may have moved out during the construction and are paying double rent. That said, she adds, “I’m all for trying to get back, but I’m going to follow the guidelines of the county and the governor. I feel that we really need to be very careful as we go forward so we don’t have a relapse.”

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