Each day seems to bring some new painful choices for small businesses to make. As the Coronavirus stories expand, it seems like there’s a new recommendation daily. If you’re running a grocery store, you likely can’t keep up with the demand for certain products. But if it’s an event space? You’ve been faced with painful choices over what programs can go on and what needs to be canceled. Sometimes, even before you made the call, your local government made the decision for you. Today’s Wall Street Journal has a good article on the Painful Choices being forced on Small Businesses due to Coronavirus.
Small Businesses in the Time of Coronavirus
The Wall Street Journal highlighted a variety of businesses facing these painful choices already. Almost any customer-facing business is going to be affected. In the US, businesses with under 500 workers employ roughly 60 million people. That’s about 47% of the private sector workforce (according to the Small Business Administration). Small businesses also tend to work on thinner profit margins than larger companies. And if it’s a business that relies on shipments from China? These days that can totally cripple their output.
Some of the luckier businesses have setups that allow their employees to work remotely. But if you are working in retail or rely on customer foot traffic, remote work may not be possible. One example that the Wall Street Journal cites is Indigo Yoga in Fort Worth Texas. With the Coronavirus restrictions, they are forced to alter their business model:
- They have invested about $10,000 in software to live-stream classes; and
- Plans for allowing instructors to teach their classes from home.
Not Everyone Is In Trouble
The news seems to be all negative for businesses, but there are some businesses that are experiencing unbridled demand. If you haven’t seen any of them, think of companies that provide cleaning services. They are in higher demand than ever and will likely have months of backlog to get everything cleaned and ready for us to get back to business as usual in the future. Companies that provide commodities that are in high demand (toilet paper?) or food are also going to experience considerable demand.
The greater question is how our economy will balance these two types of businesses out? For now, the small businesses in dire straits will be on the front page of the news. But behind all those struggling businesses, hopefully, other sectors of the economy can step up and help us rebound.