COVID-19 Could Kill Over 60% of Toronto Small Businesses in 3 Months: Survey
Closures, reduced hours, pay cuts, and layoffs — businesses big and small are doing everything they can to make it through the COVID-19 pandemic. And while some industries are able to continue with business as normal, the situation has already proved to be devastating for many others.
In fact, a survey of hundreds of small businesses throughout Toronto found that 61% or nearly two-thirds of them may be forced to close their doors for good in the next three months as they struggle to stay afloat in a sea of amounting bills and incurred expenses amid the COVID-19 pandemic.
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The survey, which was conducted by the Broadview-Danforth BIA, was based on responses from 561 small business tenants and 137 landlords from across the city.
The responses revealed that 17% of businesses believe that they can only last for another month given their “current/expected revenue,” 21% said that they could make it another two months, and 23% said that they could only last for three months.
What’s more, 76% of businesses would be forced to close down for good within five months, while just 9% of businesses said they would survive, regardless of how long orders forcing their closure remained in effect.
The survey also provided stark insight into how businesses are managing rent — 50% of respondents were unable to make April’s rent, and with May rent due next week, 72% said they feel like they’ll be unable to pay it.
Landlords in the survey indicated that 74% of them did not receive all of April’s rent, while 82% of landlords feel they will not receive all of May’s rent either.
When asked about the financial aid that is being offered by the federal government 78% of respondents said the wage subsidy doesn’t help. Just 18% indicated the federal government’s Canada Emergency Business Account (CEBA) loan of $40,000 loan helps, but 32% said it would offer better assistance if there were “no strings attached.”
The CEBA, which was launched in March, offers an interest-free backed loan of $40,000 for small and medium-sized businesses that have a payroll between $20,000 and $1.5 million a year. Previously, the requirements had been $50,000 to $1 million in total payroll.
What’s more, over 75% of landlords and 84% of business tenants said that a rent relief program is what would be most helpful.
Last week Prime Minister Trudeau noted that commercial rent relief was coming, though no further details have been provided.
Ginger Robertson, the owner of The Edmund Burke and Off the Hook, said, “What we really need is rent relief. Both businesses and landlords agree that loans and wage subsidies are not enough. We need to be able to pay rent and that’s becoming extremely difficult.”
“Without any rent relief assistance, many of us will have to shut down,” said Nathany Hynes, owner of The Auld Spot Pub on Danforth. Adding, “Our main streets won’t look the same when we come out of this. The survey clearly shows what’s not working and what’s most needed.”