Commerce In The Time Of Coronavirus

Creativity And Community Team To Overcome Daunting Times For Small Businesses

Hundreds of nonprofit organizations have worked for decades to advocate for small businesses, authentic places and vibrant activity in the urban core of America’s cities.

Now, in a time of record job loss and forced closures of countless beloved small businesses deemed “non-essential” in the time of COVID-19, the little guy needs more help than ever. The organizations fighting for their survival are called Business Improvement Districts (BIDs), Main Street alliances and Downtown Development Authorities (DDAs). They often self-tax to provide funding for extra security, cleanup crews, marketing, entertainment and other support of classic corridors, downtowns and urban business clusters.

In areas where sit-down restaurants are reduced to curbside pickup or delivery only, in a challenging time when shops that relied on foot traffic are trying to adapt to online sales, BIDs, DDAs and Main Streets are using creativity and community collaboration to keep small businesses afloat.

Dionne Baux is director of UrbanMain, a program of the National Main Street Center (NMSC) to empower under-resourced older and historic neighborhood commercial districts to restore economic vitality and promote quality of life. NMSC is a subsidiary of the National Trust for Historic Preservation.

“The primary concern has to be the health and wellbeing of people. That being said, if businesses are in a position to move aspects of their business to e-commerce shopping opportunities, that is certainly encouraged, as is delivery, curbside pickup, (encouraging patrons to buy) gift cards, etc.,” she said. “But until stay-at-home orders and congregation limitations are lifted, it will be difficult for non-essential small businesses to sustain themselves during this time.”

Main Streets are using creativity and community collaboration.

Baux quoted NMSC’s Main Street Small Business survey that underscored the simple fact that minimizing permanent business closures is critical to downtown and district recovery.

“Small business financial assistance programs should not only address revenues, but expenses as well. The survey reveals 60 percent of respondents have less than 5 months remaining of likely business survival. Thus, there is the need to not only address the revenue side of the income statement, but find ways to reduce expenses,” the survey states.

Baux noted 66 percent of survey responders indicated a need to suspend some expenses in the interim while they are mandated to be closed. These typically consist of rents, utilities and other operating fees.

“Main Street programs should engage with city officials on programs at the local level, in which there may be influence and/or control over utility operations, parking fees, etc.,” the survey advises. “In addition, while small business operations are being negatively impacted during this time, property owners represent a key stakeholder group. Main Street programs are also encouraged to dialogue with property owners as partners to help retain small business tenants, and continue as a connector and educator on programs at the federal level designed to suspend mortgage payments.”

Bill Fuller, co-founder and co-managing partner of the urban development company Barlington Group, has played a huge role in elevating Miami’s famous Calle Ocho in Little Havana from a careworn corridor to a vibrant center of art, culture and retail that draws nearly three million visitors per year. As one of the area’s largest landlords, and co-founder of the Little Havana Merchant Alliance, he and his tenants have been hit hard by Coronavirus stay-at-home and closure-of-business orders.

“From a landlord’s perspective, I have taken the time to understand webinars and literature on loan programs. My CFO is helping tenants secure loans, access grants and understand any federal, state or local assistance to small businesses,” Fuller said. “Everybody should be funded by end of May.”

Fuller, through Barlington and the separate Madroom Hospitality, has invested in many of the restaurants, bars, shops and cultural activities he and his partners have recruited to Little Havana. So, he is feeling the impact not just as a landlord but as a business owner that employs cooks, bartenders, waiters, bussers and other hospitality staff.

The Ball & Chain, a food and beverage hotspot that has been written about in The New York Times, has retained 25 percent of its staff. Another Madroom concept, the revived historic Taquerias El Mexicano, also is operating with a reduced crew.

“We never had relationships with all the Uber Eats and Postmates delivery companies,” he said, noting that onsite dining and drinking drove revenue at the two Calle Ocho fixtures. “But we decided to stay open to provide as much employment as we could, via curbside pickup and delivery.

The Ball & Chain has a promotion that patrons get back 50 percent of money spent during the crisis, by submitting receipts, — toward purchases when the home of Latin food, music and culture fully reopens. There also is a promotion that $40 spent buys a $50 gift certificate and $80 buys a $100 plus a free t-shirt. The promotions generate buzz and much-needed revenue during the pandemic.

“I have found over 90 percent of our tenants, whether open or not, have come in saying ‘I can pay 20 percent, 30 percent’ — not saying ‘I’m giving you nothing.’ You know who your real friends are,” he said, noting his mom and pop tenants are making good faith efforts.

NMSC’s Baux said Main Street programs and BIDs are helping their retail constituents and customers navigate the changing environment, citing best practices examples such as:

  • Chicago’s Morgan Park Beverly Hills Association is connecting small businesses to local, state and federal resources. It’s marketing features local businesses that are providing curbside pickup, delivery services and online sales.
  • Tenleytown Main Street in Washington, D.C., is providing members with technical assistance to set up online sales and services while obtaining permits to support restaurant pick-up and carry-out zones. Tenleytown is helping businesses apply for government grants and disaster assistance loans while issuing emergency small grants.
  • In the San Diego area, the Leucadia 101, Encinitas 101 and Cardiff 101 Main Street organizations have a goal to raise $100,000 to provide grants to local small businesses. To create the Encinitas Support Fund, the trio is partnering with the Cardiff by the Sea Foundation and the Harbaugh Foundation.
  • Our Town Coshocton, NMSC’s partner in Coshocton, Ohio, helped two local businesses join forces to sew more than 1000 Personal Protective Equipment (PPE) masks. The two mom and pop businesses — Mercantile on Main and Rose of Sharon Retreat — saw an increase in online and curbside pick-up sales.

Future Commerce May Look Different

“NMSC believes there will remain a craving, and perhaps due to social isolation, a greater appreciation for the social engagement aspects of shopping. From that stand point, the dynamic of experiential shopping may even expand,” Baux said of an ultimate silver lining.

“However, there will undoubtedly be some additional migration to e-commerce. As our survey shows, many small businesses (63 percent) have no e-commerce sales. This will need to change and traditional brick and mortar stores will need to build out a place-based and e-commerce experience for post-COVID-19 shoppers,” Baux advised. “There may be a call for more convenience-oriented shopping, such as home delivery and curbside, which may not disappear as consumers adapt to this experience.”

Georgia Petropoulos is the executive director of the Oakland Business Improvement District (OBID), which describes itself as Pittsburgh’s most ethnically diverse and lively neighborhood that is home to prestigious universities and museums; world-class hospitals; grand architecture; quaint coffee shops; international cuisine; and specialty shops.

“Like many cities across the country, our business district has been greatly impacted by the COVID-19 pandemic and our business owners have put out a herculean effort for survival,” she said. “Restaurants shifted service hours and redesigned menus to focus on takeout and delivery. Business owners have been creative with new promotions such as Salúd Juicery Oakland’s ‘Cup of Goodness’ program where the public can purchase smoothies for hospital doctors and nurses.”

“Our business owners are the life of our community and they need our help,” Petropoulos continued.

She said the BID stays in constant communication with its district community — by phone, text, survey, website, e-newsletter blasts and social media — while researching and communicating COVID-19 crisis help that is available. The BID promotes the message to the public that Oakland is open for business.

“With the universities moving to online learning and the closure of our museums and library, we saw a huge decline in the university student, faculty and staff customers and the visitor population so we focused our efforts on the hospitals and on area residents. In partnership with our hospitals, we set up a food delivery program called Support Oakland, where restaurants gain access to deliver to hospital employees,” Petropoulos said.

OBID also is providing a lot of cleanups of streetscapes and disinfecting of pedestrian “walk” light buttons — to make the area safe for those patronizing the neighborhood.

“We are a dense urban district with no drive-through opportunities, but our restaurants have adapted wonderfully. Many have removed tables and chairs to make room for customers waiting to maintain the required minimum 6-foot social distance inside while others with smaller spaces have restricted interior access and have set the tables up at the main entrance for quick and easy pick up,” she said.

Petropoulos said the Oakland and BIDs nationwide must create a new narrative of how density and the built environment impacts people, in respect to staying safe during a pandemic.

A New Look for Downtowns?

Charles Marohn is the founder and president of Strong Towns, a nonprofit making communities across the United States and Canada financially strong and resilient, and the author of “Strong Towns: A Bottom-Up Revolution to Rebuild American Prosperity.”

“What the current crisis is exposing is not, as some commentators have suggested, some previously unknown flaw in the traditional development pattern that humans have used for thousands of years and that has endured many infectious disease outbreaks. If anything, it is more likely to reveal the extreme fragility of the modern suburban experiment, and the financialized economy on which it depends,” said Marohn, an engineer, land planner and advocate of compact development.

He said when a local restaurant with a local landlord and a much more local supply chain cannot pay rent, it is in the interest of everyone involved to work it out. National chains that are announcing they cannot pay rent, “sets off a much more disruptive cascade of events that wipes out investors and jeopardizes bond markets.”

“Places with strong local economic ecosystems will endure and recover,” said Marohn. “The current crisis will also put a large strain on cities’ budgets, and this will be felt most acutely in those places where finances were already stretched by decades of low-returning development choices and deferred maintenance of overbuilt infrastructure.

“We’ve observed time and time again that the walkable, human scale, traditional pattern of development is the most financially productive approach to building human settlements, and these cities will be the most able, in the long recovery to come, to provide the services essential for their residents’ health and well-being.”

Tracy Sayegh Gabriel is an urbanist, planner and place-maker who serves as president and executive director of the Crystal City Business Improvement District, which enhances the vibrancy of Arlington — Virginia’s largest downtown.

“We are working with fitness studios and cultural institutions in the neighborhood to develop a line-up of BID-sponsored virtual programming,” she said. “It is a lifeline for our small businesses that are struggling to make ends meet. These online events provide residents with new avenues to stay both mentally and physically healthy as they adjust to life spent predominantly at home.”

The BID has organized drives, produced informational webinars and launched a “Hometown Heroes” initiative that rewards the efforts of helpful community members with gift cards to local small businesses.

“We are actively encouraging and empowering the community to support those local businesses that have remained open for carry-out and delivery. We set up a webpage that aggregates operational information so that area residents can easily access it,” Gabriel said. “We have also partnered with local government to designate nearly a dozen pick-up/delivery zones throughout the community to make it easier — and safer — for people to patronize these local establishments.

Local Support for Small Businesses

Robert Gibbs is a professional planner, landscape architect, real estate advisor and author of “Principles of Urban Retail Planning.” Based in Birmingham, Mich., he has consulted on more than 1,000 projects spanning all 50 states, including retail evaluations of all design, planning, parking, signage, management and policy issues to improve the shopper experience and improve sales.

“DDAs are essential for competitive shopping districts, especially now. Cities without DDAs will face a slower recovery than others,” he said of development authorities. “DDAs can offer marketing for restaurant carry-out, online shopping and especially their service businesses.

He said DDAs throughout the nation must prepare extensive post-recession/pandemic marketing plans to launch the moment things start to return to normal.

To endure the crisis, Gibbs said landlords must offer free rent for several months and then reduce rents to 10 percent of gross sales.

“There is a glut of vacant shopping centers and office parks, and they need to be repurposed into dense, walkable, mixed-use centers,” he said. “As regional malls are closing, many of their prime retailers are seeking downtowns to remain in the market. There are opportunities for cities to attract those prime retailers if they implement a business recruitment plan.”

The Central Square Business Improvement District in Cambridge, Mass., partnered with two other small business organizations to create Grassroots Relief for Main Streets, a statewide campaign for legislation to support small businesses, arts organizations and nonprofits.

The BID quickly partnered with local restaurant owners to provide food for the social service providers within its boundaries. In one week, Tracy Chang (James Beard award nominee) and her team at PAGU made 900 meals for the shelters in Central Square. Chang quickly helped launch Off Their Plate, a nonprofit dedicated to restoring restaurant jobs and feeding the frontlines. It raised $2 million in a month.

The International Downtown Association underscores the importance of partnerships with local government, which can ensure quick turnaround on temporary rule changes to allow more ease of conducting business during COVID-19 restrictions. Downtown Santa Monica instituted a temporary change in parking ordinances around restaurants to allow for easier pick up.

BIDS from Milwaukee to West Palm Beach have created lists of dozens of virtual events and activities to do, many powered by the local community. Milwaukee Downtown is working with museums, performing arts centers and universities to stream performances and lectures to strengthen community ties online.

Adapting Quickly

Chad Emmerson, president and chief executive officer of Downtown Huntsville, Inc., said a quick lesson learned is that small businesses able to quickly evolve in crisis will do better.

“We’ve found that the restaurants who create the most predictable and consistent experience are the ones that are rewarded with return business,” he said. “Are your online menus and hours of operation accurate? Do you answer phone and online orders in a timely way? When a customer chooses you to spend their scarcer dining dollars … when you say you’ll have it ready curbside, they don’t need a James Beard-level meal — they just need James Beard-level customer service.”

Emmerson said it is often easier and less expensive to have groceries delivered and cook at home, so small business owners should challenge themselves and their teams to make the curbside delivery a simple yet fun experience.

“This means that you need to make restaurant take-out more than a commodity. It needs to offer an emotional reprieve from the isolation we’re all experiencing,” he said. “Can you bring the meal to their car curbside in a unique way? Guests are looking for a human connection and a reason to smile. You can do that while still delivering a predictable and consistent experience.”

Level the Playing Field

Kennedy Smith is a senior researcher with the Independent Business Initiative at the Institute for Local Self-Reliance, a nonprofit that champions the need for humanly scaled institutions and economies. She said Congress, state and local governments, foundations, civic institutions, crowdfunders and customers must get cash to small, locally owned businesses to keep them afloat — because most have less than a month of cash reserves on hand.

“It is vital to level the playing field between small, locally owned businesses and big box stores. Main Street businesses are largely shuttered now and are conducting business in new and innovative ways to minimize person-to-person contact and to keep everyone safe. But, because they sell groceries and pharmaceuticals, big box stores have continued to let people in — and to let them in to all their departments, while Main Street bookstores, toy shops and clothing stores are scrambling to find innovative ways to continue serving their customers and to bring in revenue.”

Smith said small, locally owned businesses are finding very innovative ways to keep moving forward:

  • A hair salon in Alexandria, Va., is delivering a small bottle of hair coloring solution, plus some shampoo and conditioner, to customer homes, then following up with Zoom meetings to walk them through the process of touching up their roots.
  • A bar in San Antonio is offering drive-through cocktails and bottled beer and wine. With a $30 purchase, customers get a free hot dog from the hot dog stand next door and a free bottle of Stella Artois.
  • A personal chef and caterer in Metuchen, N.J., now makes family-style meals serving four to six people, and, when delivering them, offers to deliver products from other downtown businesses as well.
  • A professional photographer in Cincinnati is donating her services to other small businesses to take photos of their merchandise for their websites.

The Cherry Creek North (CCN) BID, the first BID created in the state of Colorado, represents a neighborhood five minutes north of downtown Denver that touts the largest and most diverse shopping space between Chicago and San Francisco. Out of the 260 retail and service businesses in the BID, 70 percent — just more than 175 — are small retail businesses.

“It is imperative that we provide accurate information about available grant and loan programs to our constituents. We have created a Slack portal and opened it to the entire business community,” said Jenny Starkey, senior director of Marketing & Community Relations for CCN BID.

The BID invited critical resource providers to the virtual platform to ensure businesses have direct communication with representatives from the mayor’s office, city council, the Denver Metro Economic Development Office, Denver Chamber, Cherry Creek Chamber, Small Business Administration and Denver Police.

“Small businesses have long been the backbone of our national economy and of Cherry Creek North,” said Nick LeMasters, CCN BID president and CEO. “With the largest concentration of independent business in the intermountain west, Cherry Creek North has long served as an example of a unique, diverse and highly personalized neighborhood experience. It is our highest priority to ensure that our community retains relevancy in this ever-changing market so when the time comes to welcome back those that visit, work and play in Cherry Creek North, we can do so as a strong and resilient neighborhood.”

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