The Strand Book Store in New York City has stood as a source of pride for the Bass family for 93 years. With its famous slogan “18 Miles of Books,” the Manhattan shop has weathered the Great Depression, survived 9-11, and gone to battle with Amazon (AMZN) — all without a single layoff.
That all changed in March, when owner Nancy Bass Wyden, the granddaughter of founder Benjamin Bass, made the painful decision to cut nearly 200 jobs because of the coronavirus.
“We shut everything down. We shut our store down, we shut our website down, we shut our warehouses down, because we were very concerned about the safety of our employees and the customers,” Wyden told Yahoo Finance. “We went from over 200 employees to 12 employees to conserve the payroll.”
More than two months later, the Strand is still in limbo: A little more certain about its next few months with loans secured through the government’s Paycheck Protection Program (PPP), but uncertain about its long term viability, given business lost from a sudden economic shock.
The store partnered with a third party seller to revive its online business, but Wyden worries if health concerns will trump the bookstore experience when she reopens.
“There’s probably going to be a mandate on how many people can be on each floor, how many people can come to events, having to distance people six feet apart … everybody’s going to wear a mask,” Wyden said. “I wonder about those components because people love to come in the store and just get lost in the stacks, and they love to browse, and I just worry is that going to get in the way of people having that freedom to browse here as long as they want to.”
Wyden’s concerns mirror those of small businesses across the country. As states lift stay-at-home restrictions allowing some stores to reopen, business owners are assessing the cost benefits of drastically reduced traffic with their ability to conduct limited activity.
‘Teetering on the edge of bankruptcy’
The economic pressures are magnified for small businesses, which account for 50% of total employment in the U.S. A recent study by Deutsche Bank found that one quarter of small businesses only had enough cash on hand to operate for one to two more months, while 7% said they had no liquidity.
“Many [small businesses] are in sectors that require face to face interactions with consumers. Many of them have a hard time getting credit to tie them over the types of liquidity problems they’re facing now,” said Jason Furman, who served as chair of the Council of Economic Advisers under President Obama. “There aren’t mechanisms like Chapter 11 bankruptcy that work particularly well that would help a small business restructure, shed some of its debt and continue operating and moving forward.”
This article was originally published on finance.yahoo.com/news.
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