The Paycheck Protection Program returned to the news last week after it emerged that a number of Republican members of Congress who had criticized President Joe Biden’s student loan forgiveness order had taken PPP loans and forgave them.
The federal pandemic relief program provided small business forgivable loans to help business owners keep staff on the payroll as the pandemic ravaged the economy. More than two years after the program launched, many small business owners say their business has changed a lot since then.
It took Sherard Duvall a while to secure a PPP loan for his South Carolina video production company, OTR Media Group. The company finally received its check in July 2020 – four months after submitting its first application.
At the time, Duvall said he used the money to pay workers and pay bills.
“It freed up our ability to say, ‘OK, now that some of this debt is gone, let’s consider recalibrating sales and advertising, let’s consider creating a website,'” Duvall said in 2020.
By the time he got the loan, Duvall’s video production work had dried up. So the company started a new line of business: setting up live streaming equipment in home offices, businesses, and churches.
Duvall said business has been good since.
“Almost every week we would do an installation, or we would do training, or we would send a team to an office or hire a team to go somewhere,” Duvall said.
Meanwhile, video production work returned, so Duvall expanded the business. In May — nearly two years after getting his PPP loan — Duvall took out a small business loan to buy video equipment to help the company meet demand.
“Without the success we’ve had since the pandemic, I wouldn’t have gotten this loan in May,” Duvall said.
Duvall has also hired more staff and he wants to build offices. Now he is preparing to take out another loan.
“We may have to purchase a seat, or we may have to deposit a large enough amount up front on a rental space so that we can make adjustments to the physical space inside,” said Duvall.
The pandemic has forced many businesses to evolve.
Before the pandemic, Naomi Pomeroy ran a restaurant in Portland, Oregon called Beast. Diners ate a set menu for around $175 per person. Award-winning chef James Beard said all of this was not very COVID-friendly.
“People literally sat almost side by side, with people they had never met before, for two and a half hours, eating the same thing at the same time,” Pomeroy said. “It was super fun, but I didn’t see a future with it for quite a while.”
Pomeroy closed the restaurant and used its PPP loan to start a new business: Ripe Cooperative sold boxed meals people could cook at home, as well as pastas, sauces and salads.
Then, in the spring of last year, restaurants started to reopen. “As soon as people started getting vaccinated, I had a lot of FOMO, honestly, with my friends, who had these big outdoor patio spaces,” Pomeroy said.
Last November, Pomeroy turned Ripe Cooperative into a cafe. She used some of her remaining PPP money to expand her own outdoor patio.
Pomeroy said she likes the cafe to be a lot less exclusive than her old restaurant. The challenge, she said, has been to generate profits.
“Now the model is very, very different, because it’s a cafe, and we have a lower check average,” Pomeroy said. “So it’s busier for us, but it makes a little less money, actually.”
Turning a profit has been particularly difficult for restaurants as costs rise throughout their supply chains.
“We’re at the end of that, so we’re seeing all of these increases as we buy the produce,” said Mark Frier, owner of two restaurants in Vermont. “And then we have to turn around and try to make a profit. It’s tough right now. »
Frier had a third restaurant, as well as a concert hall. He said his PPP loans kept his three businesses alive at the start of the pandemic. But late last year, between higher costs and new COVID variants, it closed the restaurant and the concert hall.
“That concert hall had been there for 50 years,” Frier said. “And I felt bad for being the one closing it. But there really was no other option. We still bore the cost of that space, even though we couldn’t make a dollar out of it. »
Frier said the outlook for his remaining restaurants is bleak. He said he couldn’t keep raising prices to cover costs. During this time, it has been difficult to find workers, so he has to close his restaurants one day a week.
“We would like to go back to seven days a week,” Frier said. “We can’t get along with the staff so we continue to stay closed for a day.”
This means he has to cover all his expenses for the week in just six days, instead of seven.
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