‘My Runway Is Over’

A look at a Main Street community on the brink. Small banks can start sending PPP applications Friday. And some good news for malls.


Last year, amid the pandemic, the U.S. had the most business starts ever: “The upswing in entrepreneurship comes against the backdrop of mass closures of established small businesses as the coronavirus lockdowns shuttered shops and kept people at home. The National Restaurant Association estimates that 17 percent of U.S. restaurants — or about 110,000 establishments — have closed either permanently or for the long term. At the same time, the pandemic has accelerated the shift toward online shopping. About a third of the increase in new business applications comes from those planning online and other ‘non-store’ retailers, reflecting how people can build a website and start selling in a matter of days.”

  • “‘The increase in applications to start new businesses is broad-based across sectors,’ Fikri said, ‘but we’re seeing real spikes exactly where you would expect: in the sectors that are experiencing real step-changes in demand, from e-commerce websites to home delivery to truck transportation.’”

  • “To be sure, many of the people filing the IRS documents will never get off the ground, and those that do probably will take several months to begin operating, economists caution.” READ MORE


The Paycheck Protection Program will open for small banks Friday and all lenders Tuesday: “Banks with $1 billion or less in assets will be able to send in applications for business owners seeking a PPP loan for the first time and those applying for a second one on Friday at 9 a.m., the U.S. Small Business Administration said. All PPP lenders will have access to the agency’s loan portal next week.” READ MORE

If your business is food, you’re going to need to know your NAICS code: “If your NAICS Code starts with a72 (Accommodation and Food Services), you are eligible for 3.5 months of PPP support instead of the standard 2.5 months. So how do you figure out your NAICS Code for the PPP application? It’s not that simple. What matters is what is reported on your tax return. And tax returns use a system called Principal Business Codes that is a variant of the NAICS system. Your PBC is usually picked by your accountant the first year that you file and never changed.”

  • “Start by checking with your accountant (or you can do it yourself) what your PBC is. If it starts with a 72, you’re good to go.”

  • “But if your PBC does not begin with a 72, and you think it should, the situation gets trickier. You will need to talk with your accountant about getting it changed and filing a revised tax-return.” READ MORE

How the pandemic is pushing one Main Street block to the brink: “Liz Dunn spent years transforming a handful of adjacent properties in Seattle into an acclaimed urban development, with apartments, offices, and a lot of retail space. Among her tenants were restaurants, a salon, a home-goods boutique, a bicycle shop, a hardware store, and a CrossFit gym. Many were in trouble after the government passed sweeping restrictions in March to control the spread of the novel coronavirus in the U.S.’s first Covid-19 hot spot. For 10 months, Dunn has managed to stay afloat by cutting deals with the three banks that hold mortgages on her properties. Getting through the next 10 won’t be easy without another lifeline. ‘I’m going to need more help,’ Dunn says. ‘My runway is over.’” READ MORE


Dollar General will pay workers to get vaccinated: “Hourly employees will get the equivalent of four hours of pay after getting the vaccine, while salaried workers will receive ‘additional store labor hours to accommodate their time away from the store,’ the discount retailer said in a statement. It also will provide assistance to its distribution and transportation teams. The announcement offers an early look at how retailers will deal with getting millions of frontline workers the vaccine -- an urgent issue from both a safety and operational standpoint, as well as an unprecedented logistical undertaking.” READ MORE

Jobless claims surged to a five-month high: “Worker filings for initial jobless claims jumped to nearly one million last week, indicating rising layoffs amid a surge in Covid-19 cases at the start of the year. The number of applications for unemployment benefits, a proxy for layoffs, rose by 181,000 to 965,000 last week, the Labor Department said Thursday. That put initial jobless claims at their highest level since mid-August and well above the roughly 800,000 a week they have averaged in recent months. The increase is another sign that the economic recovery is sputtering, as coronavirus infections hit record levels nationwide.” READ MORE

Even with high unemployment, manufacturers are struggling to find enough workers: “American manufacturers have gotten better at safeguarding their factory floors and containing infections of Covid-19 in their workforces. Despite the progress, they are still struggling to find enough people to staff their plants. The worker shortages are choking supply chains and delaying delivery of everything from car parts to candles just as demand is picking up.”

  • “For manufacturers, staffing shortages have been caused by factors including a surge in new jobs tied to e-commerce—many of which offer better pay than factory work—and absences caused by Covid or family obligations such as child care.”

  • “At a Wisconsin dairy plant, managers have been asking employees to cancel vacation and the company recently asked a maintenance worker to help make cheese.”

  • “An Ohio auto-parts maker advertised jobs on city buses and is considering adding a graveyard shift for working parents.”

  • “A generator maker is so backed up on orders due to absenteeism that it has raised starting pay 25 percent.” READ MORE


Maybe malls aren’t finished, at least not the top-tier ones: “Some procrastinators had no choice but to head to the mall in the final days leading up to Christmas to snag last-minute gifts. The uptick shows, for some consumers, malls still serve a role as a convenient shopping option. ‘The immediate nature of the post-Black Friday recovery, the strength in early 2020 and the height reached in 2020 amid exceptionally difficult circumstances all reinforce the idea that 2021 could be much kinder to indoor malls than many expect,’ Ethan Chernofsky, vice president of marketing at Placer.ai, said in the report.”

  • “Still, this report only analyzed traffic at the best-performing malls in the U.S. — likely ones owned by Simon Property Group or Brookfield Property Partners, which run some of the most valuable malls in the country.”

  • “The picture was surely bleaker elsewhere.” READ MORE

As Sephora presents a plan to rehab its image with shoppers of color, it’s tempting to wonder why a retailer would let itself get to a point where it has to say something like this: “The plan, unveiled on Wednesday, includes cracking down on discrimination among its staff, doubling its assortment of Black-owned brands by the end of the year and scaling back third-party security forces.”

  • “‘We’re seeing that there’s a tremendous commercial opportunity for us as a retailer to address the needs of all of our clients,’ Deborah Yeh, Sephora’s chief marketing officer for the Americas, said in an interview. ‘All retailers, Sephora included, have a financial incentive to get this right.’” READ MORE


Has Bitcoin lost its reason for being? “It’s easy to forget now, but Bitcoin’s promise in those early days was that it would be a new currency, one that could challenge the hegemony of so-called fiat currencies like the dollar (which are issued by governments) by being untraceable money that would allow people to conduct business cheaply and anonymously. And because Bitcoin was designed to have a fixed number of coins — it will have 21 million coins by 2140, and then no more — people could use it without worrying about inflation debasing its value. It was a kind of cyberpunk fantasy that enchanted many.”

  • “Almost from the beginning, only a small percentage of Bitcoin transactions have been for actual goods and services — and of those, many have been for illicit goods and services, like drugs and online gambling.”

  • “So, if you believe your Bitcoin is going to become more popular, then it’s foolish to spend it on a pizza: You should hoard it and then sell it once its price rises.”

  • “The more people hoard Bitcoin, treating it as a speculative asset, the less appealing it seems as a currency.” READ MORE


Episode 44: How Do I Manage My Managers? This week, responding to a question from a listener, Jay Goltz, Dana White, and Laura Zander talk about managing people. Jay offers a four-step plan that starts with making sure you’ve hired the right manager: “Anytime you ever hear anyone complaining about their employees, it's a bad manager.” Laura talks about coming to the realization that her staff is not where she thought it was—and how that’s playing into her recent anxiety attacks: “So now, I’ve got anxiety about my anxiety.” Plus: When did you know you had a real business? And Dana’s getting married! 

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