Please ensure Javascript is enabled for purposes of website accessibility NYC Small Business Seek Adams’ Help to Emerge From the Pandemic Recession - Miami Eagle
December 13, 2024

NYC Small Business Seek Adams’ Help to Emerge From the Pandemic Recession

Square Wines and Spirits in Long Island City established its first website in 2017 and was working on an upgrade in early 2020 when the pandemic shut down the economy.

Liquor stores were declared essential businesses and allowed to remain open, but Square shut its doors, concerned about the health of its staff.

“We had to completely change our business model, relying completely on our website and e-commerce,” recalled Joi Swepsin, general manager of the Queens shop.

And it worked: Square was helped by a spike in liquor sales in the initial months of the coronavirus crisis and made it through the pandemic recession virtually unscathed.

The same can’t be said for most small businesses in the city — especially companies led by owners of color, according to a report released Monday by the Center for an Urban Future.

The pandemic has inflicted an enormous toll on small businesses already in precarious financial condition before the pandemic and unprepared for the shift to e-commerce, the Center found. The incoming Adams administration must overhaul the city’s small business assistance operation and expand direct aid to help firms survive the critical coming year, the report argues.

“Just helping business through the pandemic is not enough,” said Jonathan Bowles, executive director of the Center. “New York needs to do a lot more to set these businesses up to succeed and grow.”

Most in need are the businesses located in communities of color and those owned by people of color, according to the Center. Before the pandemic, the 19,000 small businesses owned by Black and Hispanic New Yorkers accounted for barely 10% of the slightly more than 200,000 such firms.

Also before the pandemic, the average minority-owned business in New York City generated only 45% of the revenue of white-owned firms, and a small number had any e-commerce capability.

The report is based on interviews with more than 50 owners and business leaders in hard-hit communities, including Southeastern Queens, Central Brooklyn, Chinatown, Harlem, the South Bronx and the West Bronx. The Center for an Urban Future said it gave the report to the Adams transition team, which is considering its recommendations.

A One-on-One Approach

The report’s most important recommendation calls for establishing a 300-person technical assistance corps to bring help to business owners in one-on-one, on-site meetings.

The city currently provides help through 16 business solutions centers, most of which are devoted to the shrinking number of industrial businesses.

In the period from July to September of 2020 when businesses were struggling to reopen, the Department of Small Business Services reached fewer than 3% of the city’s small firms through the centers or by telephone or mobile outreach.

“The city’s programs do not meet small businesses where they are,” Bowles said. “They are just an owner and a small number of employees who don’t have time to go to a small business assistance center.”

Other experts agree with Bowles.

“The small business service centers are a good concept but one-on-one assistance is crucial for them to be sustainable,” said Valerie White, executive director of LISC NYC, a nonprofit that backs community development.

During 2020, LISC worked through community organizations to provide $10,000 cash grants and individualized help to 284 small firms in hard hit areas of the city. The assistance included adapting the businesses’ strategies to operate during COVID — converting to virtual business models and utilizing e-commerce.

With unemployment higher among Black and Hispanic New Yorkers, the Center believes the city could boost the number of minority firms by helping  jobless people join the movement toward entrepreneurship occurring at a higher rate among white workers.

To do so, the city could offer start-up grants, run competitions throughout the library system that offers the winner free rent for a year and revitalize its business acceleration teams, which are languishing in the bureaucracy, the Center recommends.

Another key recommendation: The city could fund merchant associations with grants of $20,000 to $50,000 to back local marketing campaigns to help revive traffic to small neighborhood businesses.

The report goes further by saying the city needs to help associations and other groups in areas not served by business improvement districts, especially by funding at least part-time staff who can develop programs to boost neighborhoods.

Capital Ideas

One element missing in the report is a role for the borough chambers of commerce, which have worked during the pandemic to help small firms.

For example, the Brooklyn Chamber of Commerce and the Joe & Clara Tsai Foundation launched a new lending framework that relies on assessments of the skills and character of the business owner — and not traditional bank requirements for revenues and profits that can disqualify applicants without much collateral.

The lack of capital remains a pressing problem for small businesses started by people of color. While meeting with the businesses last summer, Bowles was struck by the universal need for money to operate and expand.

“Access to capital for Black and Hispanic businesses is not a new need,” White noted. “They haven’t ever had the same access to capital.”

White suggests the Adams administration create a comprehensive clearinghouse of available aid from the city, nonprofits and philanthropic groups that organizes the resources in a comprehensive way.

A  clearinghouse would also provide a means to survey business owners to find out what they need.

“There is a disconnect in how these programs are implemented and what businesses feel their needs are,” she said.

This article was originally posted on NYC Small Business Seek Adams’ Help to Emerge From the Pandemic Recession

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