It’s no secret that the effects of social distancing measures to curb the spread of COVID-19 have hurt businesses, big and small.
Businesses deemed “non-essential” have been forced to close in several states, including Pennsylvania, which, along with the nation, recently had a record number of unemployment claims. It’s something Bob Stein has been seeing firsthand since COVID-19 first made headlines.
“All of this happened so rapidly in March and the economy shut off suddenly like a faucet,” said Stein, executive director of the University of Pittsburgh Institute for Entrepreneurial Excellence (IEE) and associate vice chancellor for innovation and entrepreneurship at Pitt.
The institute helps small businesses grow via education and consulting and supports an average of 1,300 businesses per year.
Small businesses in the U.S. employed 59.9 million people, or 47.3% of the private workforce, according to the U.S. Small Business Administration’s 2019 profile.
“Unlike the Great Recession of 2008 where some businesses did better than others, I would say between 90-95% of our clients saw a downturn these past few months. It’s been shocking to see,” said Stein.
However, some local business owners remain optimistic about the near future.
“This too shall pass,” said Bud Kahn, a certified private wealth advisor at Wealth Management Strategies, Inc. in Pittsburgh. The company is a member of the institute, with experience in helping people cope with current and previous economic difficulties.
The institute has been helping small businesses cope in a variety of ways, including publishing a small business resource page to help entrepreneurs whose operations may be affected.
The guide contains many free resources for businesses, including information on the Paycheck Protection Program, available COVID-19 loan programs and how to engage consulting from Pitt’s Small Business Development Center. It also contains guides for small business loans and recovery from COVID-19 losses.
“The guide is a small part of what we’re trying to do to help,” said Stein. “We first thought about ways we could help with this when some of our clients earlier this year started talking about disruptions in the supply chain. We’ve worked with several hundred businesses in the last two weeks to navigate which loans or assistance they should apply for, which was unprecedented.”
How the stimulus package helps
While $350 billion of the federal relief passage passed by Congress last month has gone to the Paycheck Protection Program to help small businesses, that money is reportedly running out, and Stein says that regardless, more money will be needed. The U.S. Treasury Department is currently seeking hundreds of billions of dollars of additional money to help small businesses.
Denise DeSimone, CEO of the marketing agency C-leveled and member of the institute, says she hasn’t received stimulus funding yet.
“It was a cumbersome process to apply. Our primary reason for applying for funding is because of the unknown,” she said. “If our clients start putting things on hold we want to make sure that we are covering payroll or if our clients cancel contracts, we have funding in place to help with that.”
Helping businesses through tough times
In addition to the COVID-19 guide, the institute has hosted webinars and published business planning checklists for possible extended closures with topics including different loan options and resources for those who are self-employed, independent contractors and sole proprietors.
“For the IEE to have built this community for like-minded entrepreneurs is great and contributes to businesses’ success,” said Kahn, whose business is working off a continuity plan as mandated by the U.S. Securities and Exchange Commission. “Operating remotely has been a bit cumbersome, but we’re operating with a high level of efficiency.”
“The content the IEE has brought to the table is invaluable,” said DeSimone. “We were in the middle of this crisis and it took them two days to produce a webinar to explain to business owners everything that’s happening and what programs are available to us.”
Gregg Broujos, chair of the IEE's board of advisors, said businesses shouldn’t despair and should take advantage of the “wide variety” of resources available, as well as taking immediate action.
“Business owners who choose to simply wait this out and do nothing will be the ones whose businesses will be at a disadvantage,” Broujos said. “You have to communicate with your trusted advisors.”