These are challenging times. New information is coming out on a daily basis. There is a good chance that the way you run your business today is not the way you were running it when the new year started. We asked our writers to create articles that help you run your business while maintaining your social distancing.
The National Federation of Independent Business (NFIB) Research Center recently released a survey analyzing the state of small business and the United States Small Business Administration's Paycheck Protection Program (PPP).
Survey results were released on July 27 with 71 percent of small business owners polled having already used up their entire PPP loan. According to the NFIB, the 29 percent still using their loan proceeds were not far behind. Forty-six percent of borrowers said they anticipated needing additional financial support in the next six months.
NFIB Director of Research & Policy Analysis Holly Wade commented, “Current economic conditions are putting significant stress on small business owners struggling to balance lower sales, expenses, and longer-term sustainability. Even for those owners who have exhausted their PPP loan, the economic conditions have not yet returned to levels that can support business activity for many.”
The NFIB said borrowers are waiting for lenders to start accepting loan forgiveness applications as the SBA recently issued processing instructions. Just over one-third of small business borrowers said they planned to use the SBA-provided EZ form with another 61 percent saying they were not sure which form they would use.
Twenty-one percent of survey respondents said they have, or anticipate having, to lay off employees after using the PPP loan. This number was down by only one percent from what respondents said a month prior.
The survey also found that almost half of small business owners (46 percent) are "nearly back to where they were" with some even exceeding pre-COVID sales levels. Thirty-two percent of respondents reported sales levels of 50-74 percent from last year. Twenty-one percent of small businesses still in operation have sales levels that are less than half of what they were at the same time in 2019.
Twenty-three percent of small business owners indicated they will have to close their doors if the current economic conditions do not improve in the coming six months. An additional 22 percent said they anticipate they will be able to operate no longer than 7-12 months more under these same conditions. Over half (56 percent) say they are now better situated than pre-COVID, and do not anticipate any near-term problems.
Here's a look at how respondents are struggling with various business expenses:
Image via NFIB
Mortgage/rent/lease payments remain a top challenge, with nearly 54 percent of small business owners renting their business property and 40 percent owning. Seven percent both rent and own business properties. Nearly a third own investment properties and 77 percent of those owners collect rent from these properties. Thirty-four percent of those who have renters said they are experiencing more difficulty than usual collecting rent.
When it comes to the coronavirus itself, 35 percent of small business owners say they are "very" or "moderately" concerned about contracting it while operating their business. An additional 35 percent are "somewhat" concerned. Meanwhile, the vast majority (86 percent) are 100 percent involved in daily operations. Another 10 percent are over 75 percent involved.
It's clear that many business owners expect to continue to face substantial obstacles in the near term, but it is encouraging that others are managing to do better with their business than they were before the coronavirus pandemic began.