How The Economy Is Doing in “Uncertain” Recovery

Jennifer McCluskey

This article presents a brief overview of how the economy is reportedly doing in this uncertain “recovery” from COVID, and how national trends are echoed in our north country area. As of time of this writing, the first week in October, the economy is starting to grow again, slowly, with a lot of uncertainty. According to The Economist Magazine (9/19/20 edition), after dropping 20% in the second quarter of 2020, global gross domestic product is forecast to grow 7% in the third quarter. Other articles call this a “historic bounce.” While growth is fantastic, there is still a lot of ground to be made up. The Economist reports the global economy is operating at about 90% of capacity. 

    Some industries are doing better than others. For example, housing purchases have dramatically increased, which may in turn lift consumer spending as new home owners begin to buy furnishings and realize they need new water heaters. Even in the north country, properties are getting multiple offers both from local residents ready to upgrade and from downstate people looking to move farther from crowds. According to a local real estate broker, houses with land or waterfront are being snapped up as soon as they come on the market. Local hardware stores and contractors are also busy as homeowners try to get repairs in before winter. Other businesses that relate to home improvement or socially distanced outdoor activities, like powersports sales, RV sales, garden centers, and golf courses, among others, have seen record years. Burpee, the online seed retailer, has said this has been their largest sale year ever in their 144 years. 

    Retail sales have bounced back somewhat nationally and internationally. According to JPMorgan Chase, global retail sales were back to where they were before the pandemic by July. Which makes sense, people stuck at home have had nothing else to do but shop on their computers, and have had stimulus checks with which to do so. There’s also been a little more money around as people commute less and travel less, so save on their gas bill (which is maybe not so good for local gas stations!). This is one of the reasons retail businesses should get into ecommerce. New York state has recently developed several initiatives to help retail businesses sell online. Check out https://coopcareers.org/mainstreet-online for more details and keep an eye on news releases from New York State as other programs may be available soon. 

    Some retail businesses have been busy but have also been hampered by lack of supply from manufacturers. I have heard reports from several people that automobiles are being sold as soon as they hit the lot. Kayaks too are hard to come by, as this summer saw a great increase in demand with less supply coming in from manufacturers. 

    Services, however, have been significantly down as these are much more susceptible to people avoiding crowds, and restrictions like decreased dining capacity in restaurants. According to data from OpenTable, the number of diners in restaurants remains 30-40% lower worldwide. This is likely even lower in New York state due to strict social distancing regulations. Flights, travel, and hotels are also way down. Consumer confidence is somewhat unstable as well, falling in August to its lowest level since 2014. This is likely a combination of the end of government stimulus programs and increased COVID cases in parts of the country. Visa surveyed small business owners (www.visa.com/EconomicInsights) and found that 35% report they have started to recover financially and expect to fully recover in the next 12 months. Of those that have not yet started to recover financially, 43% expect to start seeing recovery in the next three to six months, while 22% do not. The long-term employment forecast is also pretty slow, projections from the Fed indicate unemployment will not return to is pre-pandemic levels until 2023. So while there are some high points, there is still a lot of ground to cover, especially in the restaurant and hospitality industries. Further federal stimulus money seems somewhat unlikely at this point unless there is another surge of COVID forcing additional business closures, but these industries in particular could benefit from more assistance. 

    If your business needs help with recovery, you can contact your local Small Business Development Center to talk with a business advisor confidentially and free of charge. You can reach the SUNY Canton SBDC at (315) 386-7312, SUNY Canton SBDC at Clinton Community College at (518) 324-7232, or the Watertown SBDC at JCC (315) 782-9262. 

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Taking Care Of Business

Sarah O’Connell

As I write this, we are in the fifth month of the COVID-19 pandemic. Businesses in the North Country region have gradually been reopening through the four phases under specific guidelines and with many restrictions. 

    However, for businesses that deal with health and wellness, many are still not allowed to reopen yet due to the level of physical contact or proximity that is part of their normal customer interaction. 

    As the North Country region entered Phase 3, massage therapy businesses were allowed to reopen, as were hair salons and some other personal care services. As we all struggled with the isolation and anxiety produced by the crisis, this was a much welcomed development for those who needed the comfort and care that was beyond essential survival. At the same time, the operators of these businesses had to prepare rigorous safety plans for the state of New York and develop schedules and strategies to minimize risk to their customers. 

    On the other hand, physical fitness businesses like fitness centers and group yoga classes continue to be under additional scrutiny due to the risks inherent in gathering people together in activities that might increase transmission of the virus. Some exercise-related businesses have pivoted to offering virtual or online classes, particularly those with certain instructors who have a dedicated following who are willing to pay through an online payment portal to participate in a Zoom or similar digital meetup. 

    While doctors’ offices and medical clinics were open all along for emergency visits or telemedicine, dentists were not generally allowed to open until June 1 except for emergency situations. However, many of our local providers have noticed that their patients are delaying some appointments like routine checkups until later on in the year. The procedure for entering a medical office often involves waiting in one’s car until called, answering questions about recent health issues, possible contacts with ill people and travel outside the area, and undergoing temperature checks. 

    Some mental health providers who already offered online or telephone counseling have been able to continue to offer that support and have even expanded their customer base due to need. NAMI (National Alliance on Mental Illness) has gathered a pool of volunteer mental health counselors to handle calls from people feeling especially stressed or anxious during the pandemic. (1-800-950-6264). It can also offer connections to local resources. 

    As with all businesses reopened or reopening in the various phases that the state allows, the key to getting customers, clients or patients to return is to demonstrate clear and well-thought out approaches to providing as safe an experience as possible. Surveys and anecdotal evidence have shown that many people are still very wary of venturing out into situations that might expose them to the virus. Reports of uneven or absent compliance will only delay the process of economic recovery. Recent spikes in infection were directly related to unsafe gatherings during July 4th celebrations leading to the reclosing of some area businesses. Enforcement of the safety guidelines needs to be universal to bolster the confidence of the general public. 

    As of this writing, the EIDL (Economic Injury Disaster Loan) program was still open and the application window for PPP (Paycheck Protection Program) loans was open until Aug. 8. Go to www.sba.gov for more information. The SBDC advisors are here to help you through the application process and beyond. We are also available to help you with any other business needs, whether it’s ideas for recovering, marketing, or opening, expanding or buying a business. We are available by phone and email and can have video sessions as well. As the JCC campus begins its reopening process, we will keep you informed if and when we can resume in-person appointments. 

    The New York Small Business Development Center at JCC offers free, individual, confidential counseling to new or existing business owners in Jefferson and Lewis counties. For more information, contact 315-782-9262, sbdc@sunyjefferson.edu. St. Lawrence County residents can contact their SBDC at SUNY Canton, 315-386-7312, sbdc@canton.edu 

Planning Ahead For Your Business

Jennifer McCluskey

I am proud of all the work that you and all of our North Country business owners have done to make it through this difficult time. We may have a long road ahead, but you have worked hard to get here and have held on through many challenges. One way to be stronger for the path ahead is to take a good hard look at how your business did during this crisis and find out if there are things that you could do better to prepare for the future. This is a great time to figure out a solid contingency plan for your business, since this disaster may have exposed areas in which your business is weaker. You have a chance now to learn and to figure out policies that will allow you to be better prepared in the future. 

    One big area where businesses struggle significantly is cash flow and being able to set aside a “cushion” of savings. Sometimes businesses expand too fast or buy that bright shiny piece of new equipment maybe before they were ready. This pandemic may have shown you that your cushion might have been too small to deal with a possible emergency. Have you ever played the board game Risk? In the game of Risk, if you expand too fast then on the next turn the other players will wipe out all your armies because you’ll be too weak to defend. You have to expand slowly from a solid base that can be maintained. It’s the same in business: you need to shore up your current business and have enough savings to support yourself before you start trying to expand. 

    I know this is hard for businesses that are constantly living on the edge of solvency. But maybe now is a good time to make a financial plan to figure out how you can get to the point where you do have enough of a cushion to get through a couple of months with little to no income. And if you don’t think it’s possible for your business to ever get to that point, maybe you need to make some radical changes, or possibly maybe it’s time to move on and try something new. Talk to your SBDC counselor. We can help you develop strategies, look through your budget and see where changes can be made, and provide support in whatever way you need. 

    Other areas you might want to consider looking at include:  

  • Develop work from home or contingency location plans. You may have found that having some of your employees work from home went OK for your business. If you likely now have the technology capabilities you need to implement this strategy again in the future if needed.  
  • Assess communication between you and your employees. Now that they are back in the office, find out if there could be ways that you all could communicate better in the future. What systems are you going to put in place so people can get access to critical information and can make critical decisions? Does everyone know his or her role in a crisis?
  • Put key business instructions in writing in an employee manual, or consider training employees to be able to do each other’s jobs. What if a key employee or owner gets sick? Would the business be able to function without that person? Are other people than the business owner authorized to speak to the bank, accountants, and attorneys if needed?

If you need assistance with your business during this difficult time, you can reach out to your local Small Business Development Center office. If we can’t meet with you in person, we can talk on the phone, teleconference, or email, whichever works for you. We are free, confidential, and always available to help. You can reach the SUNY Canton SBDC at (315) 386-7312, SUNY Canton SBDC at Clinton Community College at (518) 324-7232, or the Watertown SBDC at JCC (315) 782-9262. 

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Sydney Schaefer/NNY Business
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Five Tips For Starting Fresh With Your Business

Jennifer McCluskey

As we start with 2020 it’s a great time to think about how you can freshen up your business to grow and have a greater impact this year. There are a few simple things that you can do to start your business off right:

Tip 1: Take Care of Yourself
Small business owners are some of the hardest working people I know. Long hours, no sick leave, and being the one in charge of all the moving parts can wear on you after a while. Frequently your needs get pushed to the side so that your business can succeed. While this can be necessary, it also means that occasionally you do need to take care of yourself. Take time out for you, whether it’s an actual “unplugged” short vacation (scary, right?), or a weekly yoga class, or even a Saturday hiking in the mountains with your family, do what you need to refresh yourself. You’ll return to your business rested and more able to see the big picture.

Tip 2: Get Organized
Getting organized will help you cut down on wasted time. Have you found yourself looking for a file for over an hour since you didn’t put it in the right folder? (Speaking from experience on that one). Or do you frequently forget tasks? During one of the slower times in your business, it can be a good idea to declutter, get your systems back in place, or try a new time management technique. I’ve found the yearly file cabinet purge and restructuring is really helpful for when business gets too busy later. There are also a lot of apps that can help you get organized. A couple of my favorites are Quickbooks Self-Employed for keeping track of business income, costs, and mileage; Cozi, a free calendar system; and Colornote which allows you to set Post-it note reminders on your phone. Also see what tasks are “time wasters” and see if there are any that you can outsource. Getting a bookkeeper to keep track of the giant box of receipts, or a Virtual Assistant to help with scheduling and returning emails may be more cost-effective than you think if they allow you to spend more time on tasks that create sales.

Tip 3: Improve Your Customer Service
Take a moment to see if there are any things you can do for your customers to improve their experience. For example, do all of your employees greet your customers with a smile? Now might be a good time to check in about that. Ask your customers if there’s anything you can do to improve, either off-line with conversations or comment cards, or online by getting Google or Yelp reviews. If there’s something that you can improve on, they’ll tell you. More reviews also help bring more people to your website. Do you have really great customers who refer a lot of business to you? Maybe get them something special as a thank you.

Tip 4: Get To Know Your Finances
If you feel like you don’t have a good handle on your expenses or know the streams of income that are most important to your business, it might be a good time to get your bookkeeping in order. Whether you keep books by hand, Excel, or use a software program like Quickbooks, it is very important to know your profit margins and overhead expenses. Making sure you do your data entry in a timely manner can save a lot of headaches at tax time and can help you keep a better eye on changes you might need to make in your business. For example, your prices may have to change to match with different costs. Take a look at your numbers and see how you feel about where you are.

Tip 5: Meet With the SBDC!
Would you like to do some of these, but just don’t know where to get started? That’s what we’re here for! The Small Business Development Center offers FREE confidential business counseling, and we can help you with any of the above tasks, and more. Just contact the office closest to you. You can reach the SUNY Canton SBDC at (315) 386-7312, SUNY Canton SBDC at Clinton Community College at (518) 324-7232, or the Watertown SBDC at JCC (315) 782-9262. We’d love to help.