It is pointed out that many small and medium-sized enterprises are closed in New York due to the pandemic of the new coronavirus
Due to the limitation of people's going out as a countermeasure against the novel coronavirus infectious disease (COVID-19), retail stores and restaurants around the world have been severely impacted economically. The impact is particularly acute for small businesses, with the New York Times reporting that one-third of small businesses based in New York City, USA, have been forced out of business.
One-Third of New York's Small Businesses May Be Gone Forever-The New York Times
In early March 2020, a Caribbean restaurant 'Glady's' in Brooklyn, New York City, earned $35,000 a week (about 3.7 million yen). However, just five months later, in August 2020, Glady's closed due to the COVID-19 pandemic.
Similar to Glady's, the small and medium-sized companies that were forced to close and close due to the COVID-19 pandemic are not only restaurants but also bookstores and amusement facilities. According to data compiled by Yelp, a business review site, in New York City, more than 2,800 businesses have completely closed or closed after March 1, 2020. About half of the closed stores are in Manhattan, where tourists and businessmen have disappeared, which is higher than any other city in the United States.
Speaking of New York City, there is an image that office buildings of large companies are densely populated, but in reality, 98% of the companies in New York City are SMEs, and more than 3 million people, which account for about half of all workers, are SMEs. working. It is said that these small and medium-sized businesses have shaped New York City's individuality in a variety of restaurants, coffee shops, bookstores, hardware stores, and amusement facilities.
At the beginning of the COVID-19 pandemic, many SMEs had the prospect that the effects of the pandemic would be temporary and that they could eventually resume operations. However, the New York Times pointed out that as the economy gradually reopened, the negative impact on SMEs became permanent. Although the US government has taken various support measures , changes in lifestyles and the threat of the second wave have put SMEs in a difficult situation.
The earliest affected by the pandemic were retailers whose main target was a large number of commuters coming to New York City. The Bank Street Bookstore, a bookstore operated by the non-profit educational institution Bank Street College of Education, has over 90% of its sales at its stores, and most of its customers are residents, college students, and elementary schools living in the neighborhood. I heard you were a teacher. “Our basis was face-to-face selling, not web selling,” said store manager Caitlyn Morrissey. The Bank Street Bookstore has given up on continuing its business and will be closed in August.
Unlike large companies with physical strength, small and medium businesses such as bookstores, grocery stores, bars, restaurants, dental clinics, gyms, and day care centers do not have the money to survive for weeks or even days. .. The Yelp Times point out that more businesses will close in New York City than Yelp reports, as Yelp focuses on consumer businesses. According to data provided by the mobile payment company Square to the New York Times, New York City companies using Square saw their transaction value halved between March 1st and April 1st.
The US government provides hundreds of billions of dollars (tens of trillions of yen) of loans to small and medium-sized enterprises as a measure against COVID-19 pandemics. However, most of the loans go to rent payments and employee salaries, and many small and medium-sized enterprises cannot hold up until the economy recovers, and they need further support from the government.
According to a research conducted by a research team at Harvard University (PDF file) , 110,000 SMEs have gone out of business in the United States in the two months from early March to early May. Especially in New York City, the service industry including restaurants has been seriously damaged, and according to the NYC Hospitality Alliance , 80% of the restaurants and bars in the city are not able to pay the full rent in June.
The closed Caribbean restaurant Glady's also sold a take-out tropical rum drink next to the restaurant during the pandemic in June 2020, securing about $12,000 a week (about 1.3 million yen). It was However, in response to the landlord's permission to reduce the rent due to the pandemic, he requested ``to pay the full rent of 8,000 dollars (about 850,000 yen) from July 2020'', and in June He has decided to close the store.
Owner William Garfield said Glady's was able to make some money from its drinks, but that didn't make it. “We were thriving before the pandemic. I can't agree with the idea that'if it does, we can survive the pandemic,'” Garfield said. It appealed to the New York Times that it was very frustrating for businesses to go bankrupt.
Some owners who own tenant properties also offer real estate companies that offer rent reductions to businesses. GFP Real Estate, which owns 2,000 tenants in New York City, said it took steps to reduce the rent while the store was closed, helping the businesses in the tenant to receive federal support. 'It doesn't make sense to drive or fight the operators, we need to help each other,' said Brian Steinwurtzel, co-chief officer of GFP Real Estate.
Even so, the pandemic seemed to have had a serious effect, and in July 2020, empty stores with no tenants became conspicuous in New York City, suggesting that many small and medium-sized enterprises could not keep up with the drastic change in the situation. Small business owners must deal not only with rent payments and virus epidemics, but also with the uncertainty of the US government's response. For example, New York City was supposed to be allowed to eat indoors in July, but due to the increase in the number of infected people, the resumption plan was suspended a few days before deregulation.
Andrea Dillon, who operated Busy Bodies, a daycare facility for children that closed in April 2020, said, 'I'm surprised that some small and medium-sized businesses haven't closed their stores yet.' Evelyn Echevarria, who runs the catering company ThroughMyKitchen, has said she hasn't received any order for the event since March, “SMEs can't survive a pandemic. This is devastating for me and many others.”
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