Written by: Amee Picchi
Source https://tinyurl.com/y27btksn
Melissa Wirt owns Latched Mama, an online clothing retailer geared to nursing moms based in Midlothian, Va. She has five kids
LINDSAY MARTIN
When the coronavirus pandemic hit in March, Lenore Estrada was in the middle of constructing a kitchen for her bakery, buoyed by demand from Google and Lyft, which served her desserts in their cafeterias.
When she learned her clients were shuttering their offices – and cutting their food orders – she made the painful decision to lay off most of her staff.
Estrada said she worked many all-nighters to keep her Three Babes Bakeshop afloat, even as she prepared to have her second child in October.
She’s juggling parenting a newborn and a 2-year-old and keeping her business alive.
“I sometimes get down, and I feel really scared about the future,” Estrada, 37, of San Francisco, told USA TODAY, noting that she worries about filing for bankruptcy. “I have had many a tearful day. I don’t have (any) choice but to press forward.”
The pandemic has been tough on women’s careers. Mothers are stretched thin between work and the strain of child care as the majority of large school districts reopened with remote instruction this fall.
Women who run small businesses face a unique set of stressors as the pandemic threatens the viability of their companies, as well as the nation’s economic growth, experts said.
Women hit harder by coronavirus
Women are more likely than men to own businesses in industries that have been hard-hit by the pandemic, such as restaurants and retail shops. Women and people of color are less likely to have the same access to capital as white men. A House committee report found the Paycheck Protection Program left behind many minority- and women-owned businesses because banks prioritized lending to customers.
Women-owned businesses have been a driving force in the economy’s growth. About 42% of businesses were owned by women in 2019, compared with about 4% in 1972, according to American Express’ State of Women-Owned Business report in 2019. In the past five years, total employment by women-owned businesses rose 8%, versus an increase of 1.8% for all businesses, the report found.
“Women are disproportionately owners of foot-traffic-based companies,” such as salons, spas and retail establishments, said Sarah Gustafson, lead data scientist at Gusto, a company that provides payroll and benefit services to small businesses. “What we saw is that female-owned businesses have had larger net losses in their headcounts than male-owned businesses.”
COVID-19 forces women-owned businesses to cut more jobs
Women-owned businesses cut more workers in April – at the height of the pandemic lockdowns – than male-owned businesses, Gusto’s analysis found. From March through September, male-owned businesses had more than double the headcount recovery compared with those owned by women, Gusto said.
Women-owned businesses are less optimistic about the future, according to a study in August from the U.S. Chamber of Commerce. It found 36% of male-owned businesses plan to increase staffing in the coming year; 24% of female-owned businesses expect to do so.
“That really points to the prolonged negative impact the pandemic can put on women,” says Neil Bradley, chief policy officer for the Chamber of Commerce.
That lack of optimism among women business owners is “a very real thing,” said Melissa Wirt, owner of Latched Mama, an online clothing retailer geared to nursing moms based in Midlothian, Virginia. “There are great partners and great men who support their entrepreneurial wives, but at the end of the day, there is so much extra weight on women’s shoulders that can’t even be measured.”
No relief check
The next few months could pose new threats for businesses if coronavirus cases continue to set records and congressional relief negotiations fail to produce a new aid package, experts and business owners said.
“Without stimulus or some sort of relief, there is a strong expectation in the next couple of months that things will turn worse,” says Daniel Sternberg, head of data science at Gusto.
Doughp (pronounced “Dope”), a cookie dough company started in 2017 by Kelsey Moreira, had more than 20 employees before the pandemic. Most of its revenue came from its location on the Las Vegas Strip.
Moriera, 29, said she noticed foot traffic falling in January as large businesses postponed conventions because of the spread of the coronavirus.
Her retail location is shuttered, and her employee count is down to two: herself and her husband.
“I’m taking it one day at a time,” she said, focusing on pivoting to an online business. “Embracing change is so important.”
New strategies are a familiar theme for the women business owners who spoke with USA TODAY. Estrada started online piemaking classes geared to corporations that want to provide their at-home workers with a bonding experience.
Because 95% of her employees are mothers, Wirt – herself the mother of five children – said she focused on supporting her staff. That included adding a remote learning center to their offices, where employees’ children could attend remote school while their parents worked.
PPP loan helps small business pivot
Wirt faced another challenge when flights stopped arriving from China, where her clothing is produced. She switched to sea freight, which has longer delivery times. A PPP loan helped her company fund the first boat shipment, and she hasn’t cut any of her employees, she said.
“It’s forced us to be more disciplined and forced us to act ahead,” she said. The upside: higher margins, given that sea freight delivery is cheaper than air freight.
Wirt, who said the PPP funds are long gone, said she worries about the future even though her business is going strong.
“I don't have backers or people who are ready to throw money at me if we get into trouble,” Wirt said. “We are only one devastating event away from disaster.”
