Latino-owned businesses adjust to “new normal” amid COVID-19
As the leading voice for Latino-owned business and entrepreneurs in the region, the GPHCC has further expanded its efforts with new initiatives to help them…
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As the United States begins to slowly reopen its economy, many small business owners have had a challenging time adjusting to the new normal caused by the COVID-19 pandemic.
This is especially true for businesses owned by people of color, which have been disproportionately impacted by the pandemic, with Latino-owned businesses among those significantly impacted.
“What that means is that the commercial corridors in our communities are vulnerable, and the livelihoods of many families are at stake,” said Jennifer Rodriguez, president & CEO of the Greater Philadelphia Hispanic Chamber of Commerce.
Two weeks after the World Health Organization declared COVID-19 a pandemic, the Stanford Latino Entrepreneurship Initiative (SLEI) conducted a survey of 224 Latino-owned businesses in the U.S. to gauge an understanding of the immediate and potential long-term business impacts of the pandemic.
The survey found that 86% of those Latino-owned businesses reported significant immediate negative effects, which included loss of revenue, complete closure, loss of clients and client engagement, and layoffs.
In addition, 66% of the businesses reported it's likely they would go out of business if current restrictions continued beyond six months.
“We are facing a significant decrease in entrepreneurship in the Latino community if the businesses and the owners do not receive the capital assistance, technical assistance and coaching necessary,” said Rodriguez.
Given the relative uncertainty of the current situation, the GPHCC has broadened its work further in helping advocate for Hispanic businesses and advancing the economic growth of the community.
To that end, GPHCC developed a new initiative campaign called Recalibrate, Retool and Restart.
“This initiative is really about helping Latino businesses successfully recover from the impact of COVID-19,” said Rodriguez.
It provides Latino business owners with the tools and resources that will help them adjust their business models in a way that allows their businesses to continue to operate and make profits during this “new normal.”
For Sofia DeLeon, owner and CEO of El Merkury, a restaurant that specializes in Central American cuisine, the pandemic caused a transformation in her business model, from catering to individual meals, as many of the weddings and large events were canceled.
“Having all the experience of making individual meals for the homeless or the front line workers has helped me put together a new [individual] menu,” she said. “It’s going to help me transition my catering department from family-style to all individual.”
Just before the shutdown occurred, Silvia Lucci, founder and owner of LUHV Food, a manufacturing company of vegan food, was in negotiations with Whole Foods to expand the business significantly.
It was tough to navigate once the pandemic hit, however Lucci credited her “immigrant grit” of coming to the United States from Argentina for helping her figure out a way to effectively adjust to operating her business.
While most restaurants were deemed essential in the wake of the shutdown, other businesses, such as Tozuda, a company that designs and manufactures safety products for sports and industrial applications, have faced a different set of challenges.
At Tozuda, 95% of the company’s revenue came from contact sports, which is likely one of the last avenues that will return as the pandemic eventually subsides.
“So, we had to take a step back,” said Jessie Garcia, CEO & founder of Tozuda.
However, by leveraging the partnerships the company had built prior to the pandemic, the team has been able to utilize its various skill sets to connections to keep the business running.
“We are actively developing a new product, our first digital product,” said Garcia. “It’s a web app platform for COVID liability tracking for organizations.”
DeLeon, Lucci and Garcia are three graduates of the first cohort of the GPHCC’s Accelerate Latinx program, an extensive seven-week business management program for Hispanic entrepreneurs.
“Latino and Latina entrepreneurs have risen up every time this country has had a predicament,” said Mark Madrid, CEO of the Latino Business Action Network (LBAN), noting 9/11 and The Great Recession as examples.
As Latino entrepreneurs continue to find solutions to rise up during this current situation, Madrid encourages Latino entrepreneurs to utilize all the resources GPHCC is providing, as well as to help and rely on each other.
At LBAN, Madrid said, there is a mantra that is used for the Hispanic entrepreneurs who take part in their scaling program.
“Do business with each other, and get business for each other,” he said. “We have to become the architects for our own solutions.”
In addition to the Recalibrate, Retool and Restart Program, the GPHCC has also created the R+ Small Business Relief Fund, which will help fund Latino-owned businesses most impacted by the pandemic and ineligible for government and institutional assistance, with grants.