On March 19th, I wrote the hardest letter I've ever had to write: a letter terminating 182 dedicated team members from our ranks. That left four of us — me, my business partner, our controller and our bookkeeper — to sift through the debris as we shut down three outstanding Mississippi restaurants and prepared for what seemed to be an inevitable end to our 26-year history of serving the public.
It was devastating. The forced lockdowns meant we no longer had an income to support our restaurants, and we still had long-term leases and loans to worry about. It was impossible to reconcile the fact that a business we had built over decades had come to a screeching halt within a period of just a few days, due to no fault of our own.
This was the mid-March reality as the pandemic gripped the nation and we went into stay-at-home lockdown. Eight months later, as the pandemic rages on, we see small business after small business once again shuttering operations with no lifeline to hold on to until the vaccine arrives and the economy recovers. The pleas can be heard from small business owners nationwide calling on our federal government and its leaders to immediately pass a new stimulus package that offers businesses in need the means to keep their doors open and their employees employed.
There's no question that small business owners are problem solvers, doers, get-it-done-at-all-costs innovators. Back in April in Mississippi, as "stay-at-home" orders shifted to partial reopenings with limits on capacity, some businesses were able to pivot and find new ways to meet the market. For my restaurants, that meant morphing from sit-down dining concepts to take-out machines with curbside delivery, neighborhood delivery and $40 value meal packs for families.
But that wouldn't have happened without government support. Thanks to the Paycheck Protection Program (PPP) and funds provided to the states via the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, we found rent and salary support that allowed us to pay the bills and rehire our furloughed workforce. Most were thankful for the opportunity and relieved to return to some form of normalcy. But significant numbers chose not to return as they either feared for their safety, were comfortable with unemployment benefits or had made personal growth choices to change fields or return to school. The challenge to restaff was ominous, but we did it with the help of the stimulus.
The stimulus provided the foundation for us to rebuild. You cannot hire when you don't have the revenue. But the PPP provided the means to start again, and then, like training wheels on a bike, once the stimulus ran out, we were balanced enough to carry on. By late October, we were able to build back to almost 70% of last year's revenue. That's not enough to pay all the bills, but it's enough, when supplemented with cash from savings, to keep the doors open.
But now, with Covid cases skyrocketing, the nation faces another potential round of restrictions and closures. Thanksgiving week is traditionally one of the busiest weeks of the year, and it sets the stage for the frantic holiday season. This year, we had one of the worst sales weeks ever. Further alarm comes from the fact that what few corporate and private parties we had booked for December have cancelled — they just cannot see a way to host an event safely in the current environment.
Catering used to be 15% to 25% of our overall business. This year it is less than 8%. Our industry has done a great job of telling our story and asking our dedicated customers to invest in us by buying gift cards. But our annual gift card sale we host each November netted 23% less this year. The bottom line is that we may only earn 55% to 60% of last year's revenue at this point, and in the best-case scenario of a slowdown — not a shutdown — we are on a course to be dramatically financially damaged. In the case of a shutdown, we doubt we could recover.
This is the case for many small businesses at the front lines of the pandemic. Main Street businesses are suffering mightily, and many were dealt a deadly blow in the first wave. The federal government must do all it can to support those still fighting so they are not casualties of this next wave. That means more stimulus.
As a small business owner, I plead that Congress and the executive branch coalesce around a new stimulus package that provides support — like the PPP — to those who can prove they truly need it.
Of course, one size does not fit all, and many businesses and industries who benefitted from the PPP loans in the past did not really need them. Passing a means-test-based PPP during this month's congressional session would provide the life raft so many of us on Main Street need to make it to 2021.
The letter to my employees I wrote in March was the hardest one I ever wrote. If I have to do it again, it will be the last. There will be no way to do it all over again.
I beg elected leadership to release targeted stimulus to keep Main Street businesses like mine open. For now, and for tomorrow.