Small business owners are facing big challenges due to COVID-19, and a new survey from WalletHub is keeping track of small business owners’ feelings and what they think should happen next. If your business has been forced to temporarily close, scale back operations or adjust your operations due to the coronavirus and social distancing, this survey can provide insight into what your fellow business owners are saying.
The WalletHub Coronavirus Small Business survey found that business owners throughout the U.S. are understandably worried about the present moment and concerned for the future, but there are also some encouraging signs of hope and resilience.
Here are a few of the key insights from the WalletHub Coronavirus Small Business Survey.
Almost All Small Businesses Are Hurting from COVID-19
The survey found that more than 87% of small business owners say that their businesses are hurting from COVID-19. Almost every small business in every state and across all kinds of industries have been affected, and many have been forced to close due to shelter-in-place orders from state or local governments. Other small businesses have been hit by the spillover effects of slower consumer spending and the heightened uncertainty about the future, which tends to cause a slowdown in business investment.
As WalletHub CEO Odysseas Papadimitriou said, “Hardly any business is unaffected. It’s not like just a sector or two of the economy has taken a downturn.”
Key Takeaway: If your business is suffering, know that you are not alone. This is an unprecedented time when much of the economy, especially brick-and-mortar retail, has been forced to go on an extended pause. That might be small comfort, but knowing that this is not your “fault” might help business owners feel better about the situation and feel more optimistic for the future.
Small Businesses Are Lacking Cash Reserves
The survey found that 35% of small business owners say that if current conditions continue, their business will only be able to survive for less than three months. Additionally, 33% said they have had to lay off employees because of COVID-19, and 36% play to lay off employees in the near future.
“Most businesses are going to zero revenue, and most businesses can’t survive long without any cash flow,” said WalletHub’s Papadimitriou. “Like most consumers, most businesses have too little saved and too much debt to hunker down and ride out this type of shock to the system without outside intervention.”
A whole 63% of business owners said that they intend to seek funds from the federal government’s coronavirus relief package of small business grants and loans, but 68% believe that “the government is not doing enough to help small business right now.”
Key Takeaway: Many businesses need outside help right now to stay afloat. Fortunately, there are several new programs from the federal Small Business Administration (SBA) that are intended to help your business get cash.
Start by applying for an Economic Injury Disaster Loan (EIDL) Advance of up to $10,000 in cash that you do not have to repay; you can also apply for other SBA loan funding at low interest rates and with favorable terms. If you are considering laying off employees, check out the Paycheck Protection Program (PPP), a forgivable loan program that can help cover the costs of your payroll and other eligible business expenses. Sole proprietors and single-member LLC owners can also apply for these programs, even if you don’t have employees.
Reasons for Optimism, Signs of Resilience
Despite the huge challenges that this situation has imposed upon America’s small business owners, most of them seem to agree that the sacrifices are worth it. The survey reports that 79% of business owners believe that minimizing the death toll of COVID-19 is more important than reopening the economy, and 40% of business owners actually are in favor of more restrictions being put in place to help respond to COVID-19.
Key Takeaway: Even though many businesses are suffering, and many people are feeling uncertain about their economic futures, there is a broad sense of public-spirited solidarity among American small business owners today. That same sense of serving the greater good and being resilient in challenging times can help entrepreneurs get through and emerge stronger on the other side.
These are truly unprecedented times, but most people would agree (and this WalletHub survey seems to suggest) that Americans on the whole are pulling together to support each other in this time with solidarity, mutual assistance, emotional strength and innovative resilience.
The same qualities and values that entrepreneurs tend to rely upon to get through hard times — adaptability, hard work, creativity, relationship-building and problem-solving — are all in demand now. Hopefully we can all get through this together and build a better future when “normal” life resumes.