What About the Pandemic Business Death Count?

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Even years from now, when history sorts this out and we can read about it from a much more clear vantage point, there won’t be any answers for these questions.

Like most people, my social media acquaintances have diverse working backgrounds. A lot are business owners, either sole proprietors, or small business. They live all over the world and are dealing with different responses to the pandemic. Everything from being ordered to stay in your home, to life – and business – as usual.

There’s no consistency to treatment of business, even in the same areas. What makes one business essential and another not? Why is one business too “high risk” to open while another operates with impunity?

Even years from now, when history sorts this out and we can read about it from a much more clear vantage point, there won’t be any answers for these questions.

Some businesses are going to weather this terrible storm. Some are not. I know of several that have already called time and declared themselves out.

One thing I have noticed across all these business is how many were already flying close to the wind even before this. One month without business is a problem. Two months without business is a disaster. Three is a catastrophe of epic proportion. Four… well… you get the picture.

It’s easy to say that it shows just how little a business keeps in reserve. That it’s up to the business to have savings for a rainy day. That’s true for individuals, of course, but anyone who would say this about a business has probably never run one.

Margins are incredibly thin, everything is plowed right back into most business in order to fuel growth. “Economies of scale” is more than a term taught in university. It is a target destination that every business strives to reach. Some do, some never do.

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Humans are resourceful. Entrepreneurs the most resourceful of all. Many have retooled their business models for now or with an eye toward the future. They will survive by being adaptable. I know businesses that have closed one business to open another, mostly in their same industry.

I know others who haven’t made that transition yet. They don’t know the direction they’ll head, only that they are done where they are. An uncertain future brings a certain finality in many cases.

Today I read from one of those business owners, “It took twelve years of hard work to build a personal service business. The clients I’ve worked hard to earn have found others to provide the service I’m not allowed to operate. Meanwhile, I’m waiting on a government to tell me if and when I can go back to work. My expenses haven’t stopped. I still have rent to pay. I still have utilities for an building with no trade. I still have insurance and debt service and my own personal expenses that would be paid by the salary I’m not earning.

“So what am I supposed to do? Start selling off the equipment I need if I ever go back to work? Give up the retail space where I would serve my clients as soon as they were allowed to come back, if they came back? Am I supposed to find a job elsewhere to fill the gap until then?

“I’ve done everything I know how. I’ve done what was asked, I’ve tried things that still stayed within the guidelines and requirements I was given. But for my business, that just does not work. And the rules are constantly changing. I can’t even keep up any more.

“What am I supposed to do?”

After several months of asking that question, he finally decided the answer was to just stop. Stop trying to figure it out. Stop trying to hold together a business that was under attack by his government. Stop the bleed. Just stop.

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His business has closed, this time for good.

His situation is not unique. That’s what makes it even more sad.