After Main Street Relief Fund, unclear picture for Concord businesses

  • Strings and Things owner Mike Bilodeau plays guitar with his son, Eric, the C.F.O. of the company on the mandolin at their downtown store in Concord on Thursday, July 9, 2020. GEOFF FORESTER—Monitor staff

  • Strings and Things owner Mike Bilodeau plays guitar at his downtown store in Concord on Thursday, July 9, 2020. GEOFF FORESTER—Monitor staff

  • Strings and Things owner Mike Bilodeau gets ready to play with his son, Eric, the C.F.O. of the company at their downtown store in Concord on Thursday, July 9, 2020. GEOFF FORESTER—Monitor staff

  • Strings and Things owner Michael Bilodeau gets ready to play at his downtown store in Concord on Thursday. Bilodeau says he’s managed to stay afloat thanks to government programs, but he worries about the potential of a second wave. GEOFF FORESTER / Monitor staff

Monitor staff
Published: 7/11/2020 4:16:10 PM

The cluttered storefront of Strings and Things has weathered far more than a virus.

For 38 years, the music shop on Concord’s South Main Street has kept open its doors – through recessions and disasters alike. It’s the kind of longevity that doesn’t crumble easily, owner Michael Bilodeau says.

Lately, that defense is being tested. “The reality is there are a whole bunch of people that are still not comfortable going out,” Bilodeau said. “It’s very trying times to say the least.”

The picture is similar everywhere. Months into an economic crisis that earlier in the year shuttered most companies and services, New Hampshire’s small businesses have received some state and federal support – from loans to grants – to keep the doors open.

But as those programs wind to a close, the next steps are less than clear. And while many businesses have managed to keep their doors open, large numbers say they’re struggling to hang on.

“Once these federal monies disappear, I think we’re really going to see who survives and who doesn’t,” said Fred Keach, the vice president of operations at D. McLeod, a flower shop in Concord. “There’s a chance to get through the fall and into Christmas. But I would predict January and February 2021 is where you’re really going to see who survives.”

David Juvet, senior vice president of the New Hampshire Business and Industry Association, agreed.

“I think a lot of businesses are limping,” he said. “But it’s so difficult to forecast what’s going to happen between now and the end of the year. It’s just, we don’t know if we’re going to be shut down again. We don’t know if the economy will continue to grow. I know that businesses large and small are feeling very stressed right now.”

For now, businesses and trade groups are eyeing three factors out of their control: whether there will be a second wave of the virus in New Hampshire; whether there will be another aid package passed in Congress; and when there might be a vaccine.

Both House and Senate Democrats and Republicans appear interested in a further round of funding, but divisions between the U.S. House and Senate have put the timeline and form of that funding up in the air.

New Hampshire businesses have benefited from two major relief programs in recent months. One, the Paycheck Protection Program, allowed businesses to apply for short-term, federally backed loans of up to $10 million each. If at least 75% of the loan was invested into employee payroll the loans would be completely forgiven.

Separately, the New Hampshire Department of Revenue Administration disbursed over $322 million in federal stimulus money last month to 5,017 businesses across the state, each of which had applied and detailed how much they expected to receive. That money, given through the Main Street Relief Fund, was distributed proportionally based on the amount of money the businesses projected to lose in 2020.

At Strings and Things, Bilodeau applied successfully to both. It’s helped keep things afloat. Yet it hasn’t staved off the longterm business slow down.

The store used the downtime of the early weeks of non-essential business shut down to get its website upgraded for sales, and it used the Paycheck Protection Program loans to cover payroll. But for guitars and other instruments appealing to first-time buyers, online sales can’t replicate the real thing, Bilodeau said. It’s not unlike the modest but insufficient boost that takeout services provide a restaurant, he said.

Meanwhile, music lessons are largely on hold. Teachers are continuing lessons for existing students remotely, but new students are not coming in.

Bilodeau says that the store is on relatively stable footing, with some increased foot traffic since stores re-opened to the public. He hopes to safely bring back in-person instruction eventually, and hire back two workers who were furloughed in the process.

Still, he said, “We are incredibly nervous about the thought of a second wave (of virus).”

Keach, of D. McLeod florists, also applied to both programs.

Keach’s predicament is somewhat better than others. The flower business has been doing alright in recent months, as social distancing has prompted some families to order flowers sent to hospitals, nursing homes and houses in lieu of visits.

Still, nearly all of his sales these days are online. Walk-in traffic to the South State Street store has dried up, a problem indicative of a broader problem for downtown Concord, Keach says.

And while he has benefited from the Paycheck Protection Program loans, nearly all of it has had to go into payroll – and nearly all of it is gone now. That’s true for almost every business that received a PPP loan.

For many downtown stores, the real test will be seasonal. How the coronavirus progresses through the fall and winter will affect a crucial period for retail, restaurant and lodging businesses, noted Keach.

For Gerry Lesmerises, the picture is different. As co-founder of Glazier’s Resource in Concord, which draws drafts for glass and glazing jobs, Lesmerises can’t look to foot traffic or holiday sales for success. Glaziers’ clients span the country, involving construction sites in rural schools and big cities.

That means they’re dependent on economic conditions in other parts of the country. The wave of shutdowns that began March have damped business considerably – as will the likely contraction of school budgets coming down the line.

And while Glazier’s has taken advantage of the PPP program and the Main Street Relief Program to keep its head above water, the realities of the business are hard to escape.

“It all depends on the work,” Lesmerises said. “If the work stays at the same level, we’ll need to do something. We won’t be able to keep everybody.” That could be four to six months in the future.

That experience gets at a universal reality, Lesmerises added.

“Everybody’s kind of skating though this time and almost falsely feeling it’s okay,” he said. “But eventually the money from the government will run out.”

Despite a promise by Gov. Chris Sununu that the relief money from the Main Street Relief Fund would be sent out in one package, some businesses – like Bilodeau’s – are waiting for the check. Others received theirs weeks ago.

Either way, most Concord businesses said they appreciated the program. That includes Tim Sink, president of the Greater Concord Chamber of Commerce. “Just about everyone eligible applied and received it,” he said of the funds.

But the program has its caveats, Sink says. One complication is that businesses aren’t sure how much they’ll need. The Main Street Relief Fund is distributed based on how much a business thinks they’ll lose in 2020. If that projection is off and the business loses less, the grant agreement allows the state to reclaim some of the grant money down the line.

That proposition has prompted some businesses to approach the funding cautiously, setting aside money only for emergencies, according to Sink.

“The fear is that if things are better than what they had planned … that they likely owe that money back,” Sink said.

Additionally, owners of franchises – like restaurants and hotels – were shut out of the application process, to keep the money local. Those businesses employ local people too, he noted.

Sink agreed that the next few months are crucial for businesses. Much of it is out of their control.

“A lot of them are looking toward the end of the year as a decision point,” he said. “And a lot of them are crossing their fingers and hoping that a vaccine can come sooner than later. I think that would create a level of confidence in people getting back out there.”

As businesses navigate, the Concord Chamber has stepped in with webinars and general advice to let them know of the state relief programs available to them. Sometimes strategy is helpful. Some loan programs can convert into de facto grant programs if conditions are met.

The end goal: to stop any potential closures. “It’s a last resort to close your doors and go home,” Sink said.

Back at Strings and Things, Bilodeau has no intention to let that happen.

“We’ve been in town for 38 years and we’ve been through recessions and depressions and pandemics for the last 30 years,” he said. “The way things are at present, we are going to be sticking around.”


Please support the Monitor's coverage

Help us fund local COVID-19 reporting in our community.




Concord Monitor Office

1 Monitor Drive
Concord,NH 03301
603-224-5301

 

© 2019 Concord Monitor
Terms & Conditions - Privacy Policy