New businesses face even greater uncertainty amid virus crisis

New businesses face even greater uncertainty amid virus crisis

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SOUTHINGTON — After opening their gaming and hobby shop on March 1, The Raven’s Nest owner Christina DeVeau said she and her husband Eric had some great first weeks. Customers dwindled as virus news increased and the shop shut down last Saturday.

“It was booming up until last week,” DeVeau said. “It’s an awful feeling. We had a great start and then it just fizzled.”

Businesses that started recently such as the DeVeau’s are dealing with mandatory shutdowns and quarantined customers in the midst of trying to establish themselves. Business owners say they’re also not eligible for some low interest loans, which require tax records from the previous year and other documentation that new ventures don’t yet have.

The U.S. Department of Labor announced Thursday that 3.3 million workers had applied for unemployment insurance in the past week, demolishing the previous record of nearly 700,000 in 1982.

Barbara Coleman-Hekeler, president of the Greater Southington Chamber of Commerce, said all businesses are working to stay afloat and retain their workers whenever possible.

“The number one concerns have to do with layoffs and employees, how they’re going to keep a qualified workforce when layoffs are over,” she said.

Christina and Eric DeVeau don’t have employees and are hopeful that they’ll be able to reopen once the quarantine is over. They’re working to promote events at the shop that will hopefully take place soon.

Their landlord and loan company are offering deferred payments during the shutdown.

“We think we’re good, as long as we can open within a couple of months,” Christina DeVeau said. “We’re doing things that are going to get people excited.”

The Manhattan

The Manhattan, a bar with a speakeasy, Prohibition-era theme, opened on Eden Avenue in November. Owner Diane Mulholland said their business model was upended by the quarantine order but that they’ve switched to take-out and have kept their kitchen running.

They’ve cut hours to wait staff and other workers that they don’t need right now.

“The coronavirus has essentially killed our business,” Mulholland said. “We’re struggling because we’re competing with all the people who’ve always done take-out.”

The bar had established a good following, but Mulholland said they now have to reestablish themselves for food delivery.

On Thursday, Gov. Ned Lamont announced $25 million in zero-interest loans for businesses with fewer than 100 employees. The conditions announced Thursday, while excluding real estate, firearms, adult and multi-level marketing businesses, didn’t mention that businesses had to be operating for a certain amount of time.

Mulholland filled out an application for a Small Business Administration bridge loan to help pay for rent, utilities, insurance and other expenses she’s incurring. At the end of the application, she found out that the loan is only for businesses that have been open for a year. Mulholland said she’s applying anyway and hopes the rule will be waived.

“We’re going to look at every loan we can,” she said. “Our expenses with renovation and opening the business caused a lot of debt.”

She and her husband Rob Sitz heavily renovated the building which they rent on Eden Avenue.

Not essential

Coleman-Hekeler has been gathering information from local businesses that was used to help craft the federal stimulus bill. 

The governor’s order to shut down certain businesses was a financial and personal blow to some owners.

“I think one of the most difficult things to hear is that your business is non-essential,” she said. “For most business owners, their business is their livelihood and for their employees as well. Their business is their life.”

In talking with businesses, Coleman-Hekeler said she’s found that owners are worried about loans, even ones with low interest.

“Anything in the form of a grant is a little more appealing to the businesses right now,” she said. “Some of our businesses are concerned about taking debt on top of debt.”

Chamber events, which are revenue-generators, have been cancelled. The chamber is now a one-woman operation: a full-time employee and intern aren’t working right now. Coleman-Hekeler said another blow is that the federal stimulus doesn’t offer aid to chambers of commerce, something that she’s working to change.

Polish Plate

Polish Plate opened shortly before Thanksgiving on West Street and had lines out the door for its first few months. Owner Margaret Kopacz said they’re now doing take-out and delivery, but that sales some days aren’t more than $200.

“It’s not even enough to cover employees,” she said.

That’s partly because the restaurant isn’t known as having delivery, according to Kopacz, and partly because many of its customers are older and more reluctant to leave their homes now.

“For us, most of the customers were 65 and over,” Kopacz said.

She heard about the loan program on Thursday and said she plans to apply. Even after the quarantine is lifted, Kopacz thinks people will still be afraid to go out and expects it will take months before business is back to where it was.

“It’s hard, because we’re a brand new business,” she said. “Only a few months open and now this.”

jbuchanan@record-journal.com203-317-2230Twitter: @JBuchananRJ

"The coronavirus has essentially killed our business. We’re struggling because we’re competing with all the people who’ve always done take-out."

-Diane Mulholland
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