As COVID-19 continues to plague the nation, small businesses are hurting.

As COVID-19 continues to plague the nation, small businesses are hurting.

From owners struggling to keep their businesses afloat to employees facing furloughs and terminations, such enterprises are feeling the brunt of the pandemics effects.

Data indicates approximately 30-50% of small businesses face closure if the pandemic continues at its current rate, according to Tim Lake, president and CEO of the Monroe County Business Development Corp.

Thats why a new program generated by elected officials is being looked at as integral to the survival of many small businesses in the state and Monroe County.

Earlier this month, the Michigan Strategic Fund, under the guidance of Gov. Gretchen Whitmer and the state Legislature, unveiled a new program geared towards providing economic relief and support to small businesses impacted by the pandemic.

The Michigan Small Business Restart Program will provide $100 million to small businesses across the state.

About $1.2 million will go specifically to businesses located within Monroe County, according to Lake.

(The program) will provide a much-needed financial relief for suffering businesses, Lake said. I do not think anyone felt the pandemic and its effects on the economy would last this long.

The program, which will be administered through 15 different economic development corporations, will issue grants of up to $20,000 to selected businesses.

The Monroe County region will receive aid through Ann Arbor Spark, the designated EDO that will administer the funds. The EDO also will administer grants to businesses in Washtenaw, Jackson, Hillsdale, Livingston and Lenawee counties.

The money is being generated through the CARES Act, legislation designed to address the impact of COVID-19.

The program is modeled after a previous one the Michigan Small Business Relief Program, which allocated $20 million to relief efforts for small businesses.

That program, which began in March, provided much of the same services as the latest one. It ended up aiding more than 2,700 businesses by its completion.

Businesses that received aid through that previous program are ineligible for the new one. The application process began July 15 and will run through Aug. 5.

The application will be administered through the Michigan Economic Development Corporation. The MEDC anticipates it will end up helping more than 5,000 businesses by the programs conclusion.

The Monroe BDC will help in the selection process for businesses located within Monroe County. Selections will be made by Sept. 30.

Additionally, 30% of the funds will be specifically earmarked for businesses owned by women, minorities and veterans, as mandated by the program.

It comes after several industries within the state have slowly returned to operating, though many are doing so under heightened regulations.

In March, many of those businesses were shuttered as state officials took action to slow the spread of the virus.

Even though several sectors of the states economy have reopened, many businesses are still trying to recover from the closure months ago.

Most businesses are certainly not back to full operations or generating the same revenue they did during this period last year, Lake said.

The hardest hit businesses are those that operate on an in-person basis, mostly in the service sector, according to Lake.

That includes salons, restaurants, hotels, bars and gyms, all of which are operating under varying restrictions enacted by Whitmer, who issued executive orders outlining rules of operation for each industry.

The latest program will help businesses stay open in hopes of being able to one day return to normal operations, Lake said, adding that small businesses are naturally vulnerable to financial hardships.

Most small businesses have very limited, if any, financial reserves, Lake said. A sudden and steep loss of revenue can be fatal.

Small business is integral to the fabric of a community, according to Lake, who said such businesses contribute to organizations within Monroe County and attract residents to the area.

Small businesses are risk takers that will bring in new products or services to a community that larger retailers or service providers would not consider economically favorable to their shareholders, Lake said. These unique offerings create an environment that gives our community a special character and competitive advantage over other communities.

Another potential economic shutdown could prove catastrophic to those contributions.

Not only would it mean an increased possibility of illness-related deaths, but it also would, once again, heavily impact the livelihoods of many business owners and their employees.

It would be impactful to many of our in-person businesses as they would be the first impacted, Lake said. They have just started generating a revenue stream (again) it would be cut off.

The pandemic also will shape the future of work in the country.

It has accelerated the need for businesses to increasingly adopt and integrate new technology, such as cloud-based applications or more automation, into their operations, Lake said.

The challenge for small businesses is these enhancements present a new learning curve and are capital intensive, Lake said. In most cases, capital is in short supply.

Facts

Resources available for local businesses

There are several resources available to local businesses struggling with the impact of COVID-19, according to Tim Lake, president and CEO of the Monroe County Business Development Corp.

I would encourage any struggling business to call the BDC, and we will direct the company to an appropriate resource for their issue, Lake said. I would encourage any business with questions or concerns to reach out.

An asset map of resources for businesses was produced by the Monroe County Link Plans Grow Strategically Pillar Team.

While several businesses are experiencing cash flow problems, many also are struggling with how to safely stay open or reopen and also address staffing issues, according to Lake.

Some also may need help establishing an online presence or shifting their business model to contactless product or service delivery, he added.

There are resources to assist these businesses, Lake said. The Michigan Small Business Development Centers have been providing support in many of these areas and will continue to do so during the pandemic.

The Monroe County Business Development Corp. can be reached at 241-8081 or at its website, monroecountybdc.org.

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Program to deliver $1.2 million in grants to struggling small businesses will provide economic relief - Monroe Evening News