They see tight-knit communities showing up for one another.
It was 11:00 a.m. on a Friday, and Sarah Guerette, Director of CEI’s Women’s Business Center, had already spoken at length with four business owners about how to navigate a situation no one was prepared for.
By the end of the day, she had called or emailed a dozen other small business owners about dealing with the impacts of the COVID-19 pandemic. Some had specific questions about federal relief programs, managing layoffs and unemployment, applying for available grant funds, changing their business model, or appropriately closing their business for good.
Sarah is one of the 18 staff members at Maine-based Coastal Enterprises, Inc. (CEI) that focus on providing advice and technical assistance to businesses. In a typical year, CEI’s business development staff offer one-on-one advising to 1,100 people. In the first six weeks of the COVID-19 pandemic, they conducted over 1,900 remote meetings with advisees.
In the spring and early summer, many meetings focused on the various relief options afforded by the CARES Act, Pandemic Unemployment Assistance, and CDC guidelines. Conversations centered on topics such as whether to keep employees on the payroll through the Payroll Protection Program or furlough them and help them apply for unemployment benefits. These decisions were complex and further complicated by the many unknowns that lay ahead. CEI staff members developed spreadsheets and rubrics that allowed them to coach business owners through the financial implications of their decisions to access the available relief programs.
Now, in between emails and one-on-one conversations, Sarah and her colleagues monitor and distill new federal and state guidelines for relief programs and re-opening guidance. They’ve also worked to help small business owners adapt their businesses: be it running financial projections for building a deck to accommodate outdoor dining, adapting telehealth best practices for previously in-person therapy sessions, or grappling with the logistics of moving a brick-and-mortar retail store online. Webinars and Q&A sessions hosted by CEI have proved to be an efficient way to disseminate frequently changing information. “Small business owners hear from others with similar challenges and questions,” Sarah reported, “and they feel less isolated in these uncertain times.”
Some small business owners have been forced to make heartbreaking choices due to the current economic situation. Several of the business owners that Sarah has spoken to since the start of the pandemic have shuttered their business for good. Some of these businesses were ones that she advised through start-up, and it’s gut-wrenching to see a promising business close due to COVID-19-related complications.
Sarah fears CEI’s business advisors will see more closures over the upcoming winter and spring, as the effects of the sudden shut-down last spring and the slow summer further impact cash flow and as businesses struggle to cover the basics of rent, utilities, insurance, and payroll. “The economy is so seasonal for many businesses in Maine. This epidemic happened at the worst possible time. Many clients had been closed for months and were just preparing to open for the season, or they had survived lean winter months in anticipation of a busy summer. Others are watching their bank account balances dwindle while they try to plot their next steps.” she said.
Others facing particular challenges are the businesses in transition. Companies who were preparing to open in March, April, or May weren’t actively doing business and thus were not able to access many of the state and federal relief programs, even though they may have already incurred expenses and signed leases or loans. Some owners expecting to retire on the sale of their businesses are suddenly losing their buyers.
Not every story is a sad one: there is the butcher who has seen an extraordinary uptick in demand from people sourcing local food, the bookstore that has moved their inventory and events online, the textile business that is now producing personal protective equipment, and the restaurant that pivoted to curbside pickup and that provided donated meals to front-line hospital workers. Other businesses experienced some relief as they received federal or state funds from applications CEI helped them submit. CEI has also modified over half of the loans in its portfolio of nearly 400 small businesses.
Even in these challenging times, the entrepreneurial spirit remains strong, and CEI business advisors are still seeing demand from individuals looking to start new businesses. Advisors are spending time with each aspiring business owner to discuss how to build a business that will be resilient in the face of what is sure to be a fluid economic and public health situation over the next months and even years. This approach means that instead of helping a client with a single business plan, they’re creating separate ones for multiple scenarios, stress-testing financial assumptions, and leveraging research about the ways our economy is changing.
As a Community Development Financial Institution and Small Business Administration partner, CEI has provided advice and financing to countless businesses through good times and bad. This is the fourth recession that CEI has helped small businesses navigate in its 42-year history,
It has been said that the state of Maine is just one big small town, and in times of crisis, tight-knit communities show up for one another. Small businesses benefit from a strong support infrastructure. So, while the days are long and the calls are difficult, as long as the phones keep ringing and inboxes are full, Sarah—and CEI—will keep showing up, for the duration of this crisis and for the recovery down the road.