Vanessa Roer has also had to get creative in how she keeps her business afloat, due to slow-arriving funds. "We're hoping this will get us through," she says. Her company suspended executive pay, including Elam's salary, in order to make payroll prior to getting the PPP on April 28 and an EIDL advance soon after. "I see tremendous cost-cutting," says Amanda Elam, Diana Institute Research Fellow at Babson College and President/CEO of Galaxy Diagnostics, Inc., a 12-person medical diagnostics company in Durham, North Carolina. That program, also pounded by applications, also got an additional $60 billion in funding during the second tranche of funding for CARES Act programs.īut even businesses that finally got funding have been forced to cut their spending to the bone after weeks of economic disruption. Under the EIDL program, businesses that are experiencing a temporary loss of revenue have been able to apply for a loan advance that does not have to be repaid for as much as $10,000. Of those, only 13% were approved for funding, 7% have received financing and 18% are still waiting for a response from a lender.Īdvances from the Economic Injury Disaster Loan (EIDL) program, another component of the CARES Act, were also slow to arrive. Only 45% of small businesses who polled in the CNBC|Survey Monkey Small Business Survey conducted from April 21-27 said they applied. Many didn't apply for funds under the CARES Act because they thought they wouldn't qualify. Those who didn't get CARES Act funding are scrambling to use whatever resources they can find to stay in business. Millions of small business owners have not been successful in receiving government aid. "You don't want to hire them back and have them sit," says Marc Lion, a CPA and partner in Mazars USA and a practice leader for the Entrepreneurial Services Group at the firm. With the law and subsequent guidances not taking into account the reality that many businesses can't open brick-and-mortar stores yet, many owners, like Hakim, are struggling to figure out what to do about employees who've been laid off or furloughed. In the meantime, many owners didn't get the funds quickly, and millions have fallen through the cracks and are still waiting for aid. Her employees hate her for it How this company totally transformed its business model to survive the coronavirus More from Invest in You: Online lending platform SoLo Funds opens spigot on interest-free peer-to-peer microloans She got a forgivable loan. We desperately need it."Īn SBA report on the PPP dated April 16 found that 1,661,367 loans worth $342,277,999,103 processed through 4,975 lenders had been approved by that point.Īnother SBA report, from April 24, found that 1,192,519 advances under the EIDL program, totaling $4,805,897,000, had been processed as of that date another SBA report found the 38,984 loans, worth $7,967,174,888, had been approved as of the same date. "I doubt we'll be back open by the time the PPP runs out," she says. Hakim's workaround has been to get advice from the Mastermind group for salon owners to find creative solutions, such as bringing back higher-paid stylists, who earn a six-figure income, as soon as she's allowed, and paying their holiday bonuses early so she can use the PPP money to pay her lease.
"They're making more money sitting at home." She is referring to the $600 bump up in unemployment checks under the CARES Act added to traditional unemployment checks, which in New York State max out at $504 a week. "They don't want to come back," she says. Meanwhile, her entry-level employees are reluctant to return. Under the rules covering the loan, Hakim can only use the money for payroll from April 20 through June 15.
The New York State on PAUSE order is in place until May 15, when a phased reopening is planned. There was one problem: The state wasn't allowing salons to open yet. Personal Loans for 670 Credit Score or LowerĪfter five weeks Hakim's loan was accepted, and she received the funds on April 20. Personal Loans for 580 Credit Score or Lower Best Debt Consolidation Loans for Bad Credit
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