Published in Economic Development

Business owners discuss reacting, coping and planning for the future in the era of coronavirus

BY Sunday, April 12, 2020 06:06pm

Call it the six stages of COVID-19 coping: Experiencing shock. Assessing. Recalibrating. Cash Flowing. Helping. Imagining.    

That seems to sum up an emotional and intellectual path many West Michigan business owners have travelled recently as their companies faced extraordinary circumstances brought on by the spread of coronavirus. 

Over the last two weeks, MiBiz spoke with owners and executives in a variety of industries. No matter what sector they work in, they all pretty much experienced the same rollercoaster of emotions. 

First came the shock at how fast the virus was spreading throughout the United States, then panic when it became clear that all non-essential businesses in Michigan would need to close to help “flatten the curve” and give the state’s hospitals a fighting chance against the highly contagious COVID-19. 

Once they got past the chaos in which the rules seemingly changed by the hour, they all needed to take a step back, assess what their next steps would be and recalibrate their business strategy. In many cases, that strategy focused on figuring out how best to take care of employees in the short term while also addressing the company’s viability in the long term as the crisis continues to play out without a realistic end date in sight. 

To that end, business owners also thrust themselves into applying for government relief programs, finding novel ways to generate revenue, and — this being West Michigan — figuring out how they could use their platforms to help others in need. 

Here are six stories of local executives dealing with the crisis, coping with the “new normal,” and looking ahead to how their companies and society could change as a result of the pandemic.

Erin Dressander, Co-owner of E+L Salon LLC, Grand Rapids

Even before Gov. Gretchen Whitmer issued the stay-home order and shut down all non-essential businesses in the state, the owners of E+L Salon LLC in Grand Rapids opted to close their doors. 

Co-owner Erin Dressander said the company took the drastic measure out of concern for the safety of “our staff, ourselves, our guests and our families.” 

“We just work so closely with people,” Dressander said. “We have people come in sick all the time — believe it or not — because they want to get their hair done.”

Dressander and her business partner Lauren Glowacki discussed the options with salon staff members, who were “on board and supportive” with temporarily closing the doors. They immediately helped their staff members file for unemployment to help during the closure. 

While the promise of expanded unemployment benefits helped ease the decision, the move came with its share of uneasiness for Dressander and Glowacki because at the time it wasn’t clear whether business owners would qualify for similar benefits. 

That uneasiness continued as the owners and staff members grappled with an overtaxed state filing system. 

At the time of this interview, about 90 percent of the staff still had not received unemployment benefits or had their claims denied. Dressander was the lucky one: “I got in right away and already have my unemployment check, but my co-owner got denied and hasn’t seen anything or gotten any answers yet. … Yes, my money is in the bank, but there’s still a lot of uncertainty. I get it: It’s obviously unknown territory, but I don’t know how everyone can sit tight without any money coming in.”

Despite those challenges and the waiting game with the salon’s bank to submit a Paycheck Protection Program application, Dressander says she’s trying to remain positive about her situation, noting “this has to end at some point.” As well, the company is lucky to have an understanding landlord in Pure Real Estate Management “who wants to keep our business and work with us.” 

In the meantime, the company is trying to stay connected with customers via social media updates, as well as eke out new ways of generating revenue, including by selling gift cards and beauty products online. 

E+L Salon also wanted to find a way to give back during the shutdown and partnered with Eastown restaurant Terra GR and other small businesses — Chasing Vanity Salon, The Barre Code and Motive Training GR — to feed medical staff at Spectrum Health.

While she expects E+L Salon will reopen “when we can,” Dressander worries about local restaurants and retailers who might be forced to close their doors for good as a result of the shutdown. 

“Leaning and depending on each other in the community as small business owners is key, especially from an emotional standpoint,” she said. “Our philosophy in the salon is that it’s community over competition.” 

Rob McCarty, CEO of The Image Shoppe Ltd., Grand Rapids

After the initial chaos of the state’s shelter in place order subsided, clients of Grand Rapids-based marketing and branding firm The Image Shoppe faced distinctly different realities. 

While the essential businesses were allowed to remain open, others “were just wiped out” and forced to close their doors “for the foreseeable future.” 

CEO Rob McCarty said his firm made sure to contact clients in both camps. 

“We’re just trying to be sensitive to what’s going on and trying to be there for (our clients),” McCarty said. 

While The Image Shoppe was considered one of the non-essential businesses, his team of creative professionals quickly made the transition to work remotely, leveraging technology to stay in touch with one another and the company’s clients.

McCarty thinks the sudden shift in how his team works may have accelerated a long anticipated transformation.

“Look at how long people have said, ‘Hey, you’re going to have to get used to this because it’s eventually going to happen,’ and now we’ve just been thrown into it,” McCarty said of remote working. “The horizon seemed maybe years out a month ago and now it’s becoming the new norm. If you’re not on four Zoom calls a day, it’s weird.”

As a B Corp, a designation that certifies the company incorporates broad social considerations into its mission, The Image Shoppe focused on being transparent with employees about how the organization is handling the shutdown and a corresponding dip in business. 

“We’ve been able to be real transparent about where we are and how it could affect them and give weekly updates on where we’re at and what we’re doing beyond the obvious,” McCarty said. “Everyone is looking for business, but beyond the obvious, what else are you doing? Are you looking at grants, are you looking at SBA loans, PPP and on and on?”

McCarty aims to take a page out of his customers’ strategies and find ways to adapt to the ever-changing situation. 

“For us, the change is going to be looking at our model at a time when we have to balance every dollar that comes in and hour that goes out,” he said, noting the current market forces the company to “become very hawkish and have to manage our labor that way.” 

“Those changes may drive staffing levels over the long haul — what we need and what we don’t, based on how the market’s changing,” McCarty said. 

From a client perspective, McCarty remains concerned about the fate of many retail and service businesses, in part because he expects consumers “are going to be very different” once the pandemic subsides. 

“It’s going to take a while for people to trust the built world that we’re in, knowing all the things that they’re going to know by the time this is over,” he said. “We’re going to have to work really hard as businesses, services or whatever to create environments that people will feel safe in. You name it, where there’s a gathering, you’re going to have ramifications that last longer than three months.”

Still, McCarty believes businesses in West Michigan and beyond will be resilient and find silver linings in the middle of the crisis.

“I’ve seen a lot of people adapt really quickly to what the opportunity is and what’s available for them to do. I’ve seen businesses completely reorganize themselves to be able to support and participate in this environment,” he said. “If you look back four weeks ago or three weeks ago even, they would have been, ‘How could I possibly change my business like that, that fast?’ Yet they have. Really, it’s pretty impressive.”

Kurtis Trevan, CEO of Gun Lake Investments, Grand Rapids

Amid all the turmoil that’s beset the business community in recent weeks, Kurtis Trevan has noticed people becoming more interested in one another as individuals. 

Business leaders are finding themselves bonding over “this huge unknown” and how it’s affecting one another, he said. 

“A lot of the conversations have started with: ‘How are you? How’s your family? Are you healthy?’ And then relating on a personal note: ‘How is your isolation going?’” Trevan said. “That’s been the part that’s been very different from a typical Monday through Friday business week.”

Trevan said the personal bonding “has been nice to see” and offers a distinct contrast to the “chaos” executives are grappling with in their businesses. 

“It feels almost daily that we’re getting hit by a semi truck with something unexpected,” he said. “You felt like you were under attack, so you’re constantly looking for where we are going to get hit next.”

Gun Lake Investments is the economic development entity of the Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians, commonly known as the Gun Lake Tribe. Across the board with the organization’s portfolio companies, revenues dropped off “50 percent plus or minus” in the short term, Trevan said. That includes for businesses with exposure to the health care industry, which is singularly focused on combating the coronavirus, not new projects or installations, he added. 

Tribally owned Commercial Sanitation Management LLC (CSM), a Hudsonville-based commercial custodial services provider, also was directly affected by Gov. Gretchen Whitmer’s closure of all public schools for the rest of the year. 

“A common example across many businesses is, one, your revenue is reducing if you don’t have clients that are critical or essential and, two, businesses are wanting to conserve cash so they’re pushing out accounts receivables much further,” Trevan said. “In many cases, there just hasn’t been a person who could physically provide payment.”

Despite the challenges, GLI has leveraged its strong balance sheet to maintain employment levels throughout the shutdown, “but that’s not to suggest that we can operate in that way forever.” The company has focused on constant communication with employees and stakeholders as the situation continues to unfold. 

“We’re just reserving enough cash in our operations to be sure that we are able to get through these things and support our existing portfolio, but we also want to find some opportunities to help. It’s a delicate balance,” Trevan said. 

GLI is letting organizations it has relationships with know that it’s ready to help “otherwise good companies” that are being hurt because of the pandemic. 

“We’re not out aggressively seeking that as we’re focused on the portfolio, but it is still important for us to get that word out,” Trevan said. 

Additionally, Trevan wonders how business development activities could change in the future as a result of the current widespread adoption of technology like Zoom and video conferencing. 

“I think people are going to be hesitant for a long period of time to get into dense environments,” he said. “That will include large weddings, fundraisers, concerts, airlines, casinos — anything where you’re sitting right next to somebody else.

“The worry is if this does become a new norm, the relationship building which you need for business is going to be a challenge. We’re going to have to find new ways to get in front of new people.”

Raquel Guzman, Co-founder of Avanti Law PLLC, Wyoming

When Gov. Gretchen Whitmer took executive action to close restaurants to in-person dining in an attempt to slow the spread of the highly contagious coronavirus, attorney Raquel Guzman knew her practice would be affected. 

“I immediately realized that at some point I was going to get hit as a business,” said Guzman, the co-founder of Wyoming-based Avanti Law PLLC who represents a handful of businesses in West Michigan’s burgeoning restaurant industry. 

The hit became a double-whammy when Whitmer issued the stay-home order that forced the closure of all non-essential businesses, including law firms like Avanti Law.

“While we continue working from home in the legal services industry, we were faced with a bigger issue: I still have work that I need to get out for clients,” Guzman said. “I had to put 18 employees to work full-time, continue getting the work out while the office is closed and not generating the normal income stream that we had.”

Immediately, Guzman started to dive into the various state and federal relief programs aimed at helping small businesses survive through the disruptions caused by the pandemic. The problem: The amount of information was overwhelming. 

She started to reach out to various local business groups and advisers, including her accountant at Morgan & Associates CPAs PC, who helped her apply for the Paycheck Protection Program from the U.S. Small Business Administration. 

Guzman empathizes with other fellow entrepreneurs given all the chaos and gut-wrenching situations they’re facing in the current crisis. 

“From the business perspective, it’s like, who’s going to come to help and give me a net?” she said. “You cannot ask a business to close the doors without then putting a net for helping that business fulfill their obligations. What is happening was not created by my business or someone else’s lack of business acumen. It was not a mistake in how they manage their funds or having the bad business idea or having bad finances. This that is happening is just the result of something that is outside of our control.”

She remains thankful for the glimmer of bipartisanship in helping small businesses weather the storm.

“I know everybody is very nervous, I know everybody is scared,” she said. “I know we’re going through very difficult times, but I have seen how the community has risen together. … I’m so glad to see people working together and coming to an understanding that this is time to just get our economy back together and get people back to do what they need to do.”

Aaron Zeigler, President of Zeigler Automotive Group, Kalamazoo

Zeigler Automotive Group started the year with brisk business, culminating in the first two weeks of March, which suggested the company was on pace for a record month. 

Then as the state of Michigan began taking action to curb the spread of the coronavirus by limiting gatherings and closing restaurants to in-person dining, sales got progressively weaker until car dealerships also were forced to close their doors as part of Gov. Gretchen Whitmer’s stay-home order. 

All new and used car sales ceased on March 23, leaving dealerships open with limited staff in the service and parts departments. 

“It’s the governor’s call on something like that. They make the rules and we play by the rules,” said Aaron Zeigler, president of Zeigler Automotive Group. “Obviously, we’re doing things a little different than what we would normally do.”

He stayed in touch with employees, prioritizing “over-communication” with his teams, which are spread across Michigan, Indiana and Illinois. As the crisis unfolded, he sent as many as two video messages a day to keep them up to speed with how the company was reacting, its strategy and what it meant for them. 

“We’ve just stayed calm,” Zeigler said. “That over-communication was really, really good for everybody and calmed everybody down when they realized, ‘Hey, we’re going to be fine. We’ll get through this and we’ll come out the other side stronger.’”

Without the ability to sell cars in Michigan, Zeigler Automotive had to get creative with its sales staff, who are working from home. (An updated executive order issued April 9 as this report went to press allowed dealerships to conduct limited online sales.)

“Even though you can’t sell a car, you can’t do a test drive, the showrooms are closed, we still connect with customers online with emails back and forth, text messages, phone calls, stuff like that,” Zeigler said. “We can still connect with customers and get ready to deliver them a car when the state opens back up for business.”

Zeigler Automotive also adapted its service practices to the new realities of the coronavirus pandemic. All of the service personnel now wear gloves, and dealerships started picking up cars for maintenance right from customers’ homes and then dropping them off. As well, the company implemented new cleaning procedures to disinfect every car before it gets returned to the customer. 

To keep leadership engaged even while they’re unable to work from the showroom floors, Zeigler brought in various speakers for conference calls, including Jim Craig, the gold medal winning goaltender for the 1980 U.S. Olympic hockey team, to talk about leading through adversity.

“We talked about how in every situation you can make it a positive. In situations like these and with our leadership team, what is it going to look like 30 or 60 or 90 days from now? The cool thing with our business is if somebody doesn’t buy a car today or doesn’t get it serviced today, they still need to buy a car, they still need to get their car serviced,” Zeigler said. “Over the course of the year, whatever we don’t sell now, we’re going to make up in subsequent months.

“The way that I look at it, there’s never been a better time to buy a car now or probably in the next three, four months. The government package is helping out small businesses and helping out individuals with stimulus checks. That puts a lot of money in play, and right now there’s not a lot of stuff to spend money on. Everybody’s spring break plans got canceled, and nobody’s going to the movie theater, nobody’s flying anywhere. That’s why we think there’s going to be a lot of pent-up demand on the other side of this.”

Amy Sparks, President and CEO of Nuvar Inc., Holland

When companies operate in crisis mode, it can be difficult to find any certainty on which to base decisions. 

In the early days of the coronavirus pandemic, state officials said Michigan had no plans to shut down, so Nuvar Inc. President and CEO Amy Sparks felt prepared to weather what initially looked like a slowdown in business. 

“We’re going to live through this thing. It’s going to be like an ’08, ’09, and I remember how we operated in that. We can do this. There’s a little bit of a familiarity and a playbook,” she said of her thinking in early March. “And then, right in an instant, it was we are shut and closed for business. … This is a work stop. It’s not a slowdown. There’s no playbook for this one.”

As a contract finished goods manufacturer for the office furniture industry, Nuvar had to plan on the fly as critical information “was literally changing by the hour.” Sparks pulled the management team together to try to develop a plan for what seemed unthinkable. 

“What do you do when orders just literally stop overnight?” Sparks said. “We were running financials, figuring out what we can do to protect our employees and our team members. What’s the best route for them in terms of being able to get the most financial help? How does the company come out of this stronger, and how do we still service our customers who are servicing the critical health care needs?”

From a leadership perspective, Sparks had to get “really comfortable with the complete unknown,” which is an end date for the virus and a return to normal. 

“I’ll tell you, if it wasn’t for my faith, I don’t know where I would be right now,” she said. “The first week and a half, I don’t know that I got two hours of sleep. … You just have to stop for a minute and breathe and then look at what can I control, what don’t I have control over, and that’s probably the hardest thing to accept. From a leadership position, your job is to remove barriers and fix things and you can’t fix this. That’s out of our control.”

What’s also helped Sparks to cope is setting small goals within the company just to be able to feel some level of control and accomplishment. She’s learned to simplify, compartmentalize and remove as much emotion as possible from her business decision making.

“We all have a heart and so many of us have never had to lay anybody off or go through anything like this ever, and it just hurts,” Sparks said. “I keep telling our team, we want to get the family back together as quickly as we can.”

Sparks also prioritized finding a way for Nuvar to help out with critical needs in the health care community, which kept some people on the job. The company quickly repurposed a team of industrial sewers and upholsterers to make personal protective equipment like facemasks for health care workers. 

Nuvar worked with Holland Hospital to design, prototype and begin production of masks within 24 hours. 

“We’re not the huge mega corporations, but we’re agile and we’ve shown we can move fast,” Sparks said. “That’s what I think is wonderful about the small business community that does support so many jobs in this country. From a bright side standpoint, we’ve always been an agile and innovative company. This has pushed us to do it even more.”

Read 5532 times Last modified on Thursday, 14 May 2020 21:25