A recent report from ValueWalk shows that American small businesses are strapped for cash, and desperately need help to survive. The worst of the worst are restaurants and bars.
They cite statistics released by Alignable, a network for small business, show that small businesses are bleeding cash. Here are some of the highlights from that article:
- 35% of U.S. small businesses couldn’t pay their rent this month, up 3% from 32% in November.
- Several B2C industries are devastated – 61% of restaurants can’t pay their rent this month. That’s up 19% from 42% in November.
- Beauty salons (46%) and travel/hospitality businesses (43%) round out the Top 3 most-affected businesses, but many others are in trouble.
- Looking at demographics, minority-owned businesses are suffering the most, as 49% of them reported that they could not afford their rent in December. That figure is 5% higher than it was in November.
- Women-owned businesses are also struggling (38% of those have not paid their rent, up 3% from 35% last month).
In a funding poll conducted by Alignable through December 5th-7th 2020, with 7,151 small business owners participating, 19% said if they were given federal funding, it would go to paying rent. 20% answered and said they would use the funds to pay their employees.
The survey also asked what additional help they’d like to receive beyond a potential new round of PPP funding, 28% said they needed help with rent assistance.
The report then documents how many small businesses were unable to pay their rent. Restaurants and bars are the most battered and beaten with 61% saying they cannot pay their rent. That is up 19% from November.
The report broke down some of the sectors hurting the most because of the lockdowns and major restrictions their governors and county officials have imposed.
- 46% of beauty salons
- 43% of travel and hospitality
- 41% of gyms
- 40% of retailers
- 40% of massage therapists
- 36% of entertainers
- 32% of construction/home services firms
Statistics also show that 37% Canadian restaurants cannot pay their rent, a 1% percent increase from November.
AUTHOR COMMENTARY
The rich man’s wealth is his strong city: the destruction of the poor is their poverty.
Proverbs 10:15
The WinePress will continue to say this till the cows come home: there is no “v-shaped” recovery. This is just further proof of that.
The stimulus package that was just signed in by Congress will not help those that truly need it. Just like the first wave of PPP, the bigs will find their way in the front of the line and gobble up all the money that should be going to the businesses that truly need it. But even if it did, it is still a lose-lose situation, because if these small businesses accept these grants loans, then they will be enslaved to the government as they will have to eventually pay it back. And there is no question that the government will be passing more stimulus in the near future as well.
The rich ruleth over the poor, and the borrower is servant to the lender.
Proverbs 22:7
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