How COVID-19 is impacting Anchorage’s small business — and what you can do
A few months ago, Jasmin Smith closed her longtime venture The Business Boutique to focus on Baby Vend, her startup business offering supplies for babies and children via vending machines. As if launching a startup wasn’t enough, in January she also opened a co-working space, Umoja, in Mountain View.
Smith poured her extra income into each of these ventures, confident that a steady revenue stream from teaching entrepreneurial classes and hosting the occasional event would keep her cash flow stable until her startups started to turn a profit.
That quickly changed as the impacts of COVID-19 swept the globe.
Smith’s teaching contract was canceled when the program and events she was planning were put on hold. As a single mother of young children, her options for temporary work are limited by the need for childcare.
“Even if it’s just for a short time, the impacts are scary,” Smith said. “My monthly income is dipping but home and business bills are due at the beginning of the month. I have some savings, but those will start to go quickly.”
Todd Grebe, a local musician, is similarly worried. He is already feeling the impact to his various income streams, which include performing, selling his music online, teaching, running an Airbnb, and driving for ride sharing apps.
“I’m torn between making money in order to provide security for my family and being morally/ethically responsible to society at large,” Grebe said.
Grebe also just invested in recording a new album. Typically, he would release it alongside live shows, but he worries if online presence alone will be enough to pay it off.
“I’m trying not to stress too much, but at some point this is going to get really bad,” Grebe said.
Looking outside for guidance
In Seattle, “really bad” has already arrived. Currently the epicenter of the COVID-19 outbreak in the U.S., small businesses are reeling from the impacts.
A Seattle survey published on March 12 showed that 80 percent of small businesses are reporting a drop in demand. Additionally, 60 percent of small businesses are considering wage reductions and staffing cutbacks, and 35 percent say they may be facing closure.
The majority of respondents noted that they expected circumstances to worsen, and on March 16, they did. Washington Gov. Jay Inslee signed a statewide emergency proclamation to temporarily shut down restaurants, bars, entertainment, and recreational facilities. Restaurants are still able to provide take-out and delivery services, and the ban does not apply to grocery stores and pharmacies, but the business losses will be substantial.
To help mitigate the impacts of COVID-19, the City of Seattle is working to help workers and families, deferring payment on business taxes and utilities, setting up a Small Business Stabilization Fund and providing assistance to access federal aid.
On March 16, Anchorage Mayor Ethan Berkowitz followed Inslee’s lead and signed an emergency order to require bars, breweries, and restaurants to halt dine-in service for food and beverage. Drive-thru, take-out, and delivery services are still allowed, and grocery stores are not impacted by the emergency order.
“By making sacrifices now, we reduce the likelihood that we will pay a larger cost later,” Berkowitz said in a statement. “These closures are consistent with CDC recommendations and with our strategy of doing what we can to reduce the possibility of transmitting COVID-19. As a friend told me, ‘It will be impossible to know if we overreacted or did too much, but it will be quite apparent if we underreacted or did too little.’ ”
Many restaurants were already offering increased pick-up and delivery service. Here’s a sampling:
• Fire Island Bakery and Market Juice are taking phone orders for pickup and staff will deliver your order to your car.
• Kincaid Grill is offering a 20 percent discount on pickup orders.
• 49th State Brewing Company has an online order and pick-up option that includes crowlers.
• The Chicken Shack, which was already using third party delivery apps GrubHub and DoorDash, added a private delivery option to limit the number of people who come in contact with your order.
Although retail stores have not been given a mandate to close, business is slowing.
Kim Stalder, owner of downtown Anchorage clothing store Circular Boutique, says she didn’t have a single customer walk through her door on March 13 when the first case of COVID-19 was announced in Alaska.
“I think they were all at Costco stocking up,” Stalder said.
On March 14, foot traffic increased to seven shoppers, but she’s unsure how long people will continue to come.
“One of my regulars came in today, like she does every Saturday,” Stalder said. “This time she let me know she wouldn’t be visiting for a while.”
Stalder says she doesn’t want to temporarily close and is trying to make sure her customers feel comfortable by providing hand sanitizer upon entry and taking extra care to wipe down all hard surfaces after each shopper leaves the store.
“I’m also offering private shopping by appointment, and will ship orders to people or deliver directly to their homes,” Stalder said.
However, if the Fifth Avenue Mall closes, as a tenant she’ll be forced to as well.
Another mall tenant, the Alaska Salt Company, announced on March 15 they will be closing until further notice.
“This was not a fun decision to make,” owner Britni Siekaniec wrote in an Instagram post. “It seems like we JUST got this place put together, fully staffed with wonderful people and ready for a booming summer. Now, it feels like the first day of winter. As a small business that is sustained by a seasonal, tourist market, our future is looking quite uncertain.”
Siekaniec is encouraging customers to shop online until their retail space opens again.
Health and entertainment
The Anchorage ban also included gyms and entertainment facilities like theaters, as well as prohibiting gatherings of 50 people or more through March 31.
Courtney Lyons, an instructor for Anchorage Yoga and Cycle and a bartender at Spenard Roadhouse, will be out of work for at least two weeks. She supports Berkowitz’s decision to issue the emergency order.
“I’m not really upset about the impact that it will have on me. It’s more important to protect vulnerable people in our community, and if this is the step we need to take to prevent the spread of the virus, if this saves one life, that’s what’s most important to me,” Lyons said.
Skinny Raven Sports postponed the Shamrock Shuffle — a popular annual foot race — and put Pub Runs on hold until the end of March, but is keeping retail locations open. They’ve also updated their website for online shopping with direct shipping, and will make deliveries to Anchorage residents placing phone orders.
Owner Daniel Greenhalgh says that he’s planning to temporarily close if necessary. For now, people needing gear to get outside for fresh air and exercise have options for shopping.
How the federal government is helping
The U.S. Small Business Administration is working directly with state governors to provide targeted, low-interest loans to small businesses and nonprofits via the Economic Injury Disaster Loan program. These loans may be used for fixed debts, payroll, accounts payable and other bills that can’t be paid because of COVID-19’s impact, and offer long-term repayment options.
In an unprecedented move, the Federal Reserve announced that it would be dropping interest rates to zero and buying at least $700 billion in government and mortgage-related bonds, as well as giving generous loans to banks so they can offer small businesses and families loans to keep financial markets stable and support businesses.
Additional updates include:
• The Centers for Disease Control and Prevention has compiled a list of recommendations for employers, ranging from capital access and workforce capacity to inventory and supply chain shortfalls and insurance coverage issues.
• The U.S. Department of Labor Occupational Safety and Health Administration prepared “Guidance on Preparing Workplaces for COVID-19” based on traditional infection prevention and industrial hygiene practices. The document focuses on how employers can implement entering, administrative and work practices controls.
• Congress is working to pass the Families First Coronavirus Response Act to provide a number of resources to individuals and businesses.
How individuals can help
Alaskans wanting to support local businesses while staying home can shop online or purchase gift cards to use later. Those with the financial means may want to consider tipping extra or opt to pay for services they choose to cancel — like babysitting, house cleaning or hair appointments — or continuing to pay their membership dues for gym membership and exercise classes.
Regardless of circumstance, gratitude always makes an impact; send a thank-you note or leave an encouraging comment on social media. Practicing social distancing can end up isolating us when we need connection the most; fortunately, technology that can help bridge the gap.
Despite the uncertainty, Stalder feels confident in her community. “As a lifelong Alaskan, I’ve seen firsthand how Alaskans support each other in times of need. I feel certain we’ll see that during this crisis.”
And, as Grebe says, “This is Alaska after all, and if there is anywhere in the world with a better can-do attitude than ours, I’m not aware of it.”
Gretchen Fauske is a marketing-minded economic developer fueled by a passion for entrepreneurship, innovation, and small business. She is the associate director for the University of Alaska Center for Economic Development, Board President for Launch Alaska, Vice Chair for Anchorage Downtown Partnership, and a Gallup-certified CliftonStrengths coach.