Categories: Retail

Saving Main Street: Cities Pick Up The Recovery Role

Cities are starting to supplement the federal government in an effort to save Main Street businesses from the destructive economic effects of the COVID-19 pandemic. While they will lack the sheer financial clout of federal assistance, they are starting to offer strategies beyond capital infusions that will assist in restarting small business when the crisis passes.

Several examples have shown up over the past week. For example, Seattle announced that it will allow eligible businesses to defer business and occupation taxes and expand its Small Business Stabilization Fund. New York City Mayor Bill de Blasio has advanced a plan to provide up to $75,000 in interest-free loans to businesses with fewer than 100 employees that experience at least a 25 percent drop in sales. For microbusinesses — those with less than five employees — the city will provide grants that cover 40 percent of payroll costs for two months. In Birmingham, Alabama a public private partnership is creating a fund to support small businesses through low-interest loans.

“Local efforts will never be able to match the scale of federal relief packages, but they do have one advantage the feds do not: speed,” reported Washington, D.C. economic policy think tank the Brookings Institute. “And speed is of the essence. According to the JPMorgan Chase Institute, 47% of small businesses have less than two weeks of cash liquidity on hand, with restaurants and retail operating at the slimmest margins. According to OpenTable, year-over-year restaurant visits are down 63% in Seattle, 61% in New York, and 53% in San Francisco due to COVID-19.”

Brookings continued, “This humanitarian crisis is rapidly turning into an economic crisis. Cities alone cannot blunt the impacts for workers and businesses, but they can be vital first responders.”

Boulder, Colorado has been working on strategies to help downtown retailers since before the coronavirus crisis. However, those recommendations have been infused with a new urgency. They are lowering occupancy costs and cutting troublesome red tape restaurateurs and shop owners have encountered in city bureaucratic processes.

Structural changes to Boulder’s Public Works Department were recently finalized. They avoid financial commitments but will improve workflows in city offices. They will also explore affordable commercial space programs and revamps of city sign codes.

“A year of work and a completely new day. We are very sensitive to the needs of all the retail entities in an industry that was already massively changing,” Boulder Assistant City Manager Yvette Bowden told the City Council this week. “These strategies we believe are still the right things to do, they just need to be morphed to fit into what we are experiencing now, and probably will continue to experience for some time.”

Even landlords and real estate design firms are retrofitting their capacities and business models to help businesses prepare for potential reopening. Harbor Retail, which specializes in the design and construction of big box retail stores, has created a task force and new products to advance economic recovery post crisis. Harbor is producing COVID-19 personal protective equipment (PPE) response products for pop-up medical treatment centers, hospitals, pharmacies, grocery and convenience stores, fast casual restaurants, retail chains, municipalities and others.

Production for products like service-counter protection shields (sneeze guards), sanitation-wipe dispensers and modular, pop-up room systems are being produced at scale at Harbor. The company is also working with retailers to adapt and develop new solutions to spur positive economic activity.

“We are anticipating a psychological-transition period after the peak of this crisis in which Americans will be trepidatious to return to routines like in-store shopping, ride sharing, hitting the gym; as well as, special moments like major sporting and entertainment events,” said Harbor Retail President Walter Miranda. “Harbor is working on these industry sectors to create reassurance models and products to aid confidence and trust levels in individuals in their post [COVID-19] transition. Our goals are to help businesses, brands and cities increase individuals’ peace of mind around sanitation, contact and visit frequency.”

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NEW PYMNTS STUDY: LEVERAGING THE DIGITAL BANKING SHIFT – SEPTEMBER 2020

The September 2020 Leveraging The Digital Banking Shift Study, PYMNTS examines consumers’ growing use of online and mobile tools to open and manage accounts as well as the factors that are paramount in building and maintaining trust in the current economic environment. The report is based on a survey of nearly 2,200 account-holding U.S. consumers.

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