Small businesses get COVID-19 relief in private grants, as Verizon boosts support to $7.5M - USA TODAY

Small businesses get COVID-19 relief in private grants, as Verizon boosts support to $7.5M - USA TODAY


Small businesses get COVID-19 relief in private grants, as Verizon boosts support to $7.5M - USA TODAY

Posted: 30 Apr 2020 04:05 AM PDT

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Rafael Larios didn't expect Verizon to be a vital ingredient to the survival of his family's Los Angeles area restaurants. 

But since the two restaurants have been relying on deliveries due to the coronavirus pandemic, the family is striving to keep the business cooking. 

The most important thing needed? Cash. "We need to pay our bread guy, we need to pay our pastry guys, we need to catch up on payroll … and we get paid last," says Larios, who has taken over the family business of two Honduras' Kitchen restaurants along with his brother Jonathan.

As assistance has been elusive for many small businesses across the country, some of them – like the Larios family – are looking for answers and support among their business networks and the private sector.

"One of the members of the small business association class my brother and I had taken sent me an email with information" on different assistance programs, added Larios. 

For the Larios, that assistance came in the form of a grant program from Verizon in partnership with the nonprofit nationwide community development groupLocal Initiatives Support Corporation (LISC), which established the LISC's Verizon Small Business Recovery Fund.

Larios' restaurants in Huntington Park and Long Beach, California, are among the 200 small businesses across the U.S. receiving up to $10,000 in the form of small business grants from the Verizon fund's first round of applicants.

Verizon is bolstering the fund, the telecom giant announced Thursday, adding an additional $2.5 million donation, bringing the total up to "more than a $7.5 million," according to Rose Stuckey Kirk, Verizon's chief corporate social responsibility officer.

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The fund is offering support to small businesses facing immediate financial threat due to the COVID-19 pandemic, focusing especially on historically underserved communities.

"We are looking for small businesses, urban and rural, that size between five to 15 employees. Businesses that are the backbone to their communities," said LISC president and CEO Maurice Jones.

That's the case for DeShanta Black, a beauty boutique owner in Pennington, Alabama, who saw her business (and income) compromised during the pandemic.

"It's really hard trying to get a loan, especially being a woman minority," Black said. "Once COVID-19 came, I started making masks for the community to have some sort of income."

The harsh conditions small business owners face daily extends to their employees, vendors, and their communities, as assistance gets held up.

Larios says that Honduras' Kitchen applied for the Paycheck Protection Program (PPP) "two days" after the government made it available to the public and they still "haven't heard anything."

The Small Business Administration program offers firms employing 500 or fewer workers low-interest loans to cover their costs while they're shuttered. But while the SBA has approved billions in loans since April 3, businesses point to a myriad of challenges in the PPP's rollout: technical glitches, an avalanche of requests, a lack of response, and an exhaustion of money.

Jones confirmed that businesses that have received government loans aren't excluded from being selected to receive grants from LISC's Verizon Small Business Recovery Fund. Black, for example, has not applied for the PPP, but did acknowledge it was a question in the application process.

Verizon has also been rallying support for small businesses affected by COVID-19 through its weekly streaming entertainment series "Pay It Forward Live." During the live events, viewers are encouraged to do what they can to support local businesses in their own communities and help spread the word of the program in social media using #PayItForwardLIVE.

Black confirmed that social channels were the key for her. "I was scrolling on Facebook and someone had posted it. And I just applied for (the grant) to see if it was legit," she said.

For each use of the hashtag, Verizon will donate $10, up to $2.5 million, to support small businesses.

When it comes to those businesses in rural areas, Black acknowledged that "the main thing is that we can't wait for opportunities to fall in our lap and we have to get out there and research."

Small businesses owners interested in applying for a grant can visit Verizon Small Business Recovery Fund.

Contributing: Paul Davidson and Ledyard King

Read or Share this story: https://www.usatoday.com/story/money/business/2020/04/30/coronavirus-aid-verizon-expands-small-business-support-up-7-5-m/3053496001/

Small business loan helped keep afloat critical health clinic on Atlanta's West End - 11Alive.com WXIA

Posted: 30 Apr 2020 04:27 PM PDT

For health clinics and other small businesses that serve low income patients, customers and clients, SBA loans are now critical for survival.

ATLANTA — Metro Atlanta small business owners are again rushing to the banks to get a piece of the $310 billion Small Business Administration paycheck protection loans after many were frozen out of the first round when the money quickly ran out.

For the Family Health Centers of Georgia, serving low income and indigent patients in the city's West End neighborhood, getting an SBA loan was critical to its survival.

"We would have been struggling to meet payroll, and we would have been struggling with our financial obligations," said Dr. Michael Brooks, President and CEO of Family Health Centers.

With a staff of 120 employees, Dr. Brooks said the more than $1 million he got after not getting anything in the first round is critical to one of the core missions of the Centers.

"We are seeing patients who are unemployed and uninsured - we see them all," Brooks said. "We don't refuse service to anyone."

One of those patients Ebonie Whisonant, a single mother of two, who has been living in Atlanta's West End for 21 years and relies on the clinic for all of her medical needs.

"It is very important to me, because I am a low income family, and I need it," she said. "It is convenient, and if they don't continue, my children would not have gotten the services they needed, and I would have been out on the street."

Another key role of the Family Health Centers is offering free Covid-19 testing, which they've been doing for more than a month. They say the loan will now keep that going.

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The president of African-American owned Unity National Bank, George Andrews, is helping make sure Family Health Centers and other small business owners are properly submitting SBA loan applications to ensure they're getting the money they need.

"We have submitted over one hundred applications and twenty-five have been approved, representing in the neighborhood of five to seven million dollars," he said.

All that money, said Andrews, is what will keep small businesses alive on Atlanta's West End.

Without it, he said many "mom-and-pop" stores and restaurants will be forced to close down permanently.

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To sign up for free Covid-19 testing:

Call Family Health Centers of Georgia
1-800-935-6721
www.coronavirusinfo@fhcga.org

11Alive is focusing our news coverage on the facts and not the fear around the virus. We want to keep you informed about the latest developments while ensuring that we deliver confirmed, factual information.

We will track the most important coronavirus elements relating to Georgia on this page. Refresh often for new information. 

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6 Ways To Rebuild Your Small Business After COVID-19 - Forbes

Posted: 30 Apr 2020 10:11 AM PDT

The COVID-19 outbreak has wreaked financial havoc around the globe, leaving many small-business owners struggling in its wake. According to the National Federation of Independent Business (NFIB), as of March 30—still early in the crisis—92% of small businesses said they had suffered negative effects as a result of the pandemic. Just 5% of small-business owners said they had experienced no effects at all.

While the short-term outlook for small businesses varies greatly by industry, it's important to consider what recovery mode will look like once the economy begins to return to a state of normalcy—or establishes a new normal. Having an exit strategy in place for after COVID-19 can help you be prepared to hit the ground running and rebuild. If you're not sure what your coronavirus exit plan should include, this guide can help with getting your business back on track.

1. Assess the Financial Damage

The first step in developing a rebuilding plan for COVID-19 is determining just how deeply your small business has been affected.

There are different layers involved, starting with the hard numbers. If you haven't updated your financial statements—such as profit and loss or cash flow statements—recently, it's helpful to do that now. You can then compare them to last year's numbers to see how much your business may be down. And while only a small percentage of business owners say they've benefited from the pandemic, 3% according to the NFIB, it's possible that the damage might not be as bad as you think.

Aside from the hard numbers relating to sales, profits and cash flow, consider other ways in which your business has been affected. For example, if you've had to lay off some or all of your employees, you'll need to factor that into your rebuilding plan. If you've cut your advertising and marketing budget down, or some of your customers have migrated toward competitors, then those are things you'll need to account for as you identify financial resources to help you recover.

2. Take a Second Look at Your Business Plan

Your business model may have worked perfectly fine pre-COVID-19, but coming out of it may mean you have to do some fine-tuning.

Specifically, you may need to consider how your business can pivot to adjust to a new normal. For example, if you previously relied on foot traffic to a brick-and-mortar location for sales, you may need to look at a digital expansion to accommodate the higher numbers of people who are shopping from home.

You're not in this alone, however. In partnership with the Small Business Administration (SBA), SCORE offers small businesses access to mentors who can offer guidance and resources as you look to build—or rebuild—your business after the crisis. Remote mentoring services are available, along with free webinars that address coronavirus-specific issues.

Analyzing how your overall industry has been affected by the coronavirus pandemic also is helpful. When looking at your competitors and the industry as a whole, pay attention to the trends and focus on finding the opportunities. Being able to find a gap or need that your business can fulfill that's been neglected up until now could be critical to reclaiming and expanding your customer base going forward.

When going over your business plan and business model, get clear on your business's strengths and weaknesses. Then, look at what was working before that may not work as well now and see where you can adjust or improve to remain competitive. Finally, don't forget to revisit your business goals to make sure they're realistic, given the current circumstances. For example, you may have set a target revenue goal for the year that will need to be scaled back now to account for the damper COVID-19 may have put on your Q2 sales.

3. Consider Whether You'll Need Funding to Recover

Unless you had a large amount of cash on hand going into the pandemic, it's likely that you may need some working capital to jump-start your business operations coming out of it.

When it comes to financing your small business during a COVID-19 rebuilding period, there are several options to consider. The SBA is an obvious choice for business loans, and there are a few programs that can help. The Paycheck Protection Program, for example, is designed to provide funding to small businesses that are struggling to retain their employees during the coronavirus pandemic. Economic Injury Disaster Loans also can help with short-term financing if you need money for things other than employee retention. 

The challenge with both of those federally mandated programs, however, is that the funding is limited. It's entirely possible that funding may be depleted before your application for a loan is ever reviewed. For this reason, it's important to consider other sources of small business funding, including:

  • Traditional SBA 7(a) loans and microloans
  • Small business term loans from banks, credit unions and online lenders
  • Business lines of credit
  • Business credit cards
  • Vendor tradelines
  • Accounts receivable financing
  • Merchant cash advances
  • Inventory financing
  • Purchase order financing
  • Equipment financing

Each option can have pros and cons. Accounts receivable financing and merchant cash advance financing, for example, can be convenient, and neither one requires perfect credit to qualify. Either could be useful for funding your business in the short term.

But they both require that you have something to leverage, i.e., outstanding invoices and credit card sales, respectively. If sales are slow or nonexistent, you might have a hard time getting approved. Alternative financing options like these also can have much higher effective annual percentage rates compared to other types of small-business loans and lines of credit.

If you're considering financing to help rebuild, keep in mind that borrowing may be competitive, as lenders want some reassurance that loans can be repaid. Reviewing your business and personal credit scores, as well as your business and personal financials can help you gauge how likely you are to get approved for funding.

4. Revamp Your Budget to Account for New Spending

Coming out of the COVID-19 pandemic, you may have to spend money before you can make money.

For example, you may need to spend money on hiring and training new employees or rehiring ones you had to lay off. Inventory may need to be purchased, and you might have to rev up your advertising budget again to start building fresh buzz.

As part of your coronavirus recovery, you should have a clear idea of what you need to be budgeting for and what you can cut to make the most of the revenue you do have coming in. The goal is to eliminate the monetary waste and get your operating budget as lean as possible so that when the chance to invest in growth comes up, you're able to take advantage of it.

An extreme step you could take during this time is deferring paying yourself a salary or taking a pay cut. Whether this makes sense depends on how well you're able to manage your personal financial obligations, depending on what you have in savings or from a spouse's income if you're married. But skipping out on paychecks in the near term could help your business to get back on its feet faster.

5. Develop a Time Line for Rebuilding

You may have several things you need or want to do to recover following COVID-19, but doing everything at once may not be realistic. What can help is having a time line to follow that prioritizes your most important actions first.

For example, your immediate goal may be securing funding for your business. Once you've done that, you can set a time line for rehiring employees, then restocking inventory and, finally, reopening your doors if your small business closed as a result of the pandemic.

As you take individual steps toward recovery, remember to track your progress. This is particularly important if you've secured capital to fund your business, because you don't want to waste time on activities that aren't delivering a solid return on your investment. In the initial stages of COVID-19 recovery, you may want to check in weekly to see what's working and what's not. Later, you can shift to reviewing your business financials monthly as things begin to stabilize.

6. Create a Contingency Plan for the Next Crisis

While the coronavirus pandemic may seem like a once-in-a-lifetime event, the reality is that an emergency can come along to disrupt your small business at any time. Using what you've learned during the current pandemic to prepare for the next crisis can help you insulate your business from future shocks.

For instance, building up liquid cash savings may be a priority for your business if you had little or nothing set aside before the COVID-19 outbreak began. You may choose to focus on paying down your debt and trimming nonessential spending to keep your budget in check. Or you may need to find ways to help your staff work more efficiently to cut operating costs.

The pandemic also may have taught you a thing or two about how important it is to be able to adapt and keep your business fluid so you can reasonably weather storms. For example, if your employees didn't have the option to work remotely before, that's something you may want to incorporate in your business model going forward.

The more outside-the-box thinking you can do to prepare for a worst-case scenario, the better. Having a Plan B (and even a Plan C, D, E and F) can help improve your business's odds of surviving—and eventually thriving again—during tough financial times.

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