Reporting on the coronavirus crisis nationwide, the New York Times’ top headline read “Sales at U.S. Stores Hit ‘Catastrophic’ Depths” and subhead “Retailers Fear Any Rebound Is Too Far Off.”
The U.S. Commerce Department reported that total sales in the U.S. – money spent on retail purchases, dining, etc. – declined 8.7% in a month. That was in March.
Now, in mid-April, Evanston and elsewhere continue to feel the economic ravages of the novel corona virus. Businesses here are doing their best to buck the tide of financial repercussions from this novel coronavirus and the “stay-at-home” mandate.
Store-closings have been abrupt and some, indefinite; many of those that remain open in some fashion are asking for community support through such things as online purchases, carryout orders and “virtual tip jars.”
The unique small businesses and restaurants here attract patrons from Chicago and surrounding suburbs, but business leaders here are unsure that all of them will make it through the devastation caused by the coronavirus. Business leaders, City officials and community members are pulling together to keep the shops, restaurants and other business concerns afloat in this sea of health and financial crisis.
In March, Mayor Stephen Hagerty approached Chamber of Commerce Executive Director Roger Sosa to form and lead a Coronavirus Business Working Group. “The group includes Paul Zalmezak from the City, Annie Coakley of Downtown Evanston, Katherine Gotsick of Main Dempster Mile, Mari Barnes from Central Street, Aldermen Melissa Wynne and Robin Rue Simmons, and about 12 local business leaders representing a variety of businesses,” Mr. Sosa told the RoundTable. The group meets remotely twice each week, working on communication to the local community, lobbying, and post-event recovery, he said.
Ms. Gotsick told the RoundTable, “No business that I know of is in the shape it thought it would be. The best businesses that I know of are at 70% capacity. I know of businesses that are at 0%. That is dangerous, because there is no money coming in to pay the bills. … I can’t imagine that everyone’s going to get through this. May 1 is going to be a real moment of truth – with rent and other bills due – if the [federal] Payroll Protection Program (PPP) doesn’t come in.”
Downtown Evanston reports similarly. “This pandemic has had a major effect on the Evanston business community, particularly retail and hospitality, including restaurants and the hotels. Non-essential businesses are promoting on-line sales and gift card purchases to be used in the future. Restaurants that previously employed 50-80 people are down to between five and 10 employees. I remain hopeful that many of our businesses will return, but I fear that will not be the case,” Ms. Coakley told the RoundTable.
She added that even before the stay-at-home order, many retailers were “struggling to make a profit. They were already battling against on-line shopping. It remains to be seen, but I hope when the ‘shelter in place’ [order] is lifted, it will be a reminder of how important it is for our residents to support brick-and-mortar retail, because, without customers and sales, we won’t have them. These independent businesses are a big reason why people wanted to live in Evanston. They are unique, and they are selling special items. When we are ready I hope there will be a big push to support these businesses like never before.”
Mr. Sosa said the Business Working Group conducted a survey in later March, and 133 businesses from across Evanston responded. Nearly half – 45% said they were closed till further notice, he said.
Results of two later business task surveys were grim. The first survey, said Ms. Coakley, was crafted “to see who had applied and for what. The second survey to see if there had been any confirmation on those applications and where businesses are in the process. It has not been promising. Only two businesses out of 80 that replied to the second survey have received funding.” That does not mean, she said, that only two Evanston businesses have received funding but that only two that are known from the April 14 survey.
On the sunnier side, Ms. Gotsick said, “I can’t say enough about how the community has been supportive …. They’re ordering carryout, doing curbside pickups, buying gift cards, tagging and posting about their favorite businesses on social media … paying for restaurants to deliver meals to those who need them.”
Making what seems a three-way symbiosis; businesses are also pitching in with community efforts and asking residents to help them pay their staff.
Ms. Gotsick offered some examples: “Firehouse has delivered pizza to hospital workers and150 meals to Connections. One of the items on the menu at La Principal is ‘feed a family.’ Evanston Stitchworks started making mask kits, with fabric and elastic to make 12-14 masks. …Really cool things, wonderful, beautiful things”
Several businesses in the Central Street Business District are closed. Rachel Hershinow, owner of Stella, said customers are referred to both Stella’s website and its Facebook page.
“What I’ve noted is that it seems like half of Americans are working. Their businesses can adapt through teleconferencing in corporate settings. And then the businesses that are very hands-on are almost dead in the water,” Ms. Hershinow told the RoundTable.
“For instance, a salon or a masseuse or a chiropractor is literally all about touch, so they can’t do anything at all. So I worry about my brothers and sisters on this [Central] Street who have businesses of that kind. For my store – even though I have products that I can show pictures of or sell online – I’ve always prided my small store as a touch-and-feel place.”
Ms. Hershinow said for the first few weeks of the quarantine she was mourning the loss of those connections, “and then the second part of the quarantine for me has been: I have a business that I have to figure out how to adapt and bring what I have, in the way that I do it, to my customers. And it was a fine line of not selling things that are not valid in today’s world. No one needs a necklace, you know, so I first started to sell comfort items like candles and feel- good items, because it didn’t feel right to push other things.
“Customers have been unbelievable lovely and loyal. I home-deliver. … There’s no physical interaction but I’m on the phone talking. … And so it’s just adapting. I know I won’t have to do that for a very long period of time, but I’ll do what I have to do. … But people have been really lovely in the community. … Not all people are experiencing this exactly the same way. They’re still having productivity in their businesses. They’re just doing it in a different way.”
The Evanston Chamber of Commerce reports that about 30 businesses – the majority of them restaurants – have begun gofundme campaigns to help them stay open and pay their staff – through, for example, a “virtual tip jar.”
Downtown Evanston is promoting Gift Card Day, April 25, an initiative for all Evanston business districts to help support retailers. The association has also inaugurated a T-shirt campaign to benefit the LEND program.
The City of Evanston has been “very supportive,” Ms. Gotsick said, by deferring certain payments. For 60 days beginning March 18, the City has deferred liquor taxes; amusement taxes; water, sewer and sanitation bills; and parking and compliance citations. More specifically, “Under the directive, eating and drinking establishments that incurred less than $75,000 in sales tax liabilities last year will not be charged penalties or interest on payments due in March, April or May made late. Penalties and interest will be automatically waived; however, qualified taxpayers must still file their sales tax return even if they are unable to make a payment.”
The City also plans to “redeploy” $100,000 from its workforce development allocation to implement a small-business loan program in cooperation with LEND.
The staff recommendation to City Council states, “The COVID-19 pandemic and the resulting social distancing requirements resulting from Illinois Governor’s COVID-19 Executive Order No. 8 has negatively impacted Evanston’s small business’ ability to generate revenue to support rent payments, payroll, health insurance, and other critical business-operations needs.” Because the federal government is relying on local banks to process Payroll Protection Program requests, the memo says, the number of applications could overwhelm existing systems and lead to delays that would further harm local business.
LEND is a non-profit micro-finance organization that provides microloans to minority and women owned businesses in the Evanston area. LEND proposes emergency zero-percent interest microloans of up to $5,000 with flexible maturation dates in order to provide businesses the best chance of recovery
City Council could have this arrangement in place as early as April 27.
Governor J.B. Pritzker on April 8 was asked how he felt when he sees shops and restaurants close because of his stay-at-home order.
He said, “It’s devastating. It’s devastating for the people who closed their business. It’s devastating for the people who worked at the businesses. I hope that those shops will not close forever. I hope that those small businesses loans that we’re offering in the State of Illinois and the small business support that’s coming from the federal government will allow these businesses to survive and reopen when its time. We’re doing our best.
“I’m talking every day to federal officials, federal elected officials to get them to do something in a stimulus fashion. There’s going to be another Care Act, I’m told, to expand support for small business as well as individuals across the country, and we want to do everything we can to help those people.
“But if you want to know how it makes me feel, I know how hard it is to start a business and to make it initially successful. Many small businesses get started, and they don’t get very far. The ones that do survive by working 18 hours a day, seven days a week sometimes to make it. And when they finally make it – the idea that a virus is going to devastate your business is not something anybody ever could have imagined.
“But here we are. And we’ve got to stop the spread of this virus. We’ve got to save lives, so we can save livelihoods.”
State resources offered so far may not help Evanston businesses as much as will these local efforts, Ms. Gotsick said. The State has deferred sales tax payments for restaurants of a certain size, but these are generally smaller than are Evanston restaurants. ”Things that help people in the Champaign area do not necessarily help those here.”
The Payroll Protection Program, part of the federal CARES (Coronavirus Aid, Relief, and. Economic Security Act), will help Evanston business “if that gets going,” Ms. Gotsick said. The Small Business Administration has asked local banks to administer the loans, and SBA will buy them back, she said, adding “Lucky for us none of the banks in Evanston has declined [but] no one has seen money yet, no one has been able to apply.”
Ms. Coakley said, “Loans and grants will help, but even those will not save some of our businesses. The rollout of the most sought after resource, The Payment Protection Program (PPP), has been anything but smooth. … The Small Business Association did not make the application intake or the overall instructions for this program easy.”
Mr. Sosa told the RoundTable last week, “In terms of reopening, no one can tell right now. We don’t have a date or what the conditions will be at that time. Our main concern is to help businesses now with loan and grant applications. The process is slow and time consuming. If we could ask for any help, it would be to lobby legislators for more assistance and a more efficient process.”