Small businesses in San Jose struggling to stay afloat during pandemic

Sporting events were considered the “bread and butter” for Josh McGhie’s 4th Street Pizza Co. in Downtown San Jose, which would have hosted large groups gathered to watch March Madness play out on the big screen.

But the shelter-in-place orders have banned group gatherings to slow the spread of COVID-19, decimating McGhie’s business and forcing him to operate through take-out only.

His story is similar for local businesses across the country. A recent Goldman Sachs survey of 1,500 small business owners said that more than half were worried that they cannot survive a sustained shutdown beyond three months. 

McGhie’s employees are also facing the consequences of coronavirus, fighting financial struggles of their own.

“Our employees are in limbo,” he said. “None of our bartenders are working. It’s just a tough time for everybody.”

“It’s impacted us big-time,” he said. “We are basically wiped out money-wise right now.”

Missy Wiegand owns Salon 383 in Downtown Campbell, and has seen a sharp decline in business due to COVID-19. With all of her clients quarantined, she cannot keep her stylists, who as independent contractors cannot receive any unemployment benefits.

Changing business models

4th Street Pizza Co.

Offers takeout pizza during shelter in place.

Method 3 Fitness

Customized workout, recipes and lifestyle tips.

Salon 383

Styling products sold online.

“We can’t apply for disability,” she said. “We’re pretty much screwed.”

Wiegand said she had seen reports that more than 60% of salons will not survive the shutdown, a grim assessment of the financial toll taken on small business owners

“I don’t know how many salons will survive this,” she said.

Despite the downturn in business, the owners are optimistic that customers will return once they reopen.

Wiegand said she believes her business will be a part of that portion of salons that survive due to good customer relationships and support.

“I do like I feel good about my clients,” she said, as well as her landlord “because I have a good relationship with him.”

Despite the hardship, McGhie’s customers have continued to keep the establishment afloat with take-out orders.

“We’re strong enough to make it,” he said. “We’re successful, and we’ve been around. We’re gonna get through it.”

While many businesses have temporarily closed their doors, others are finding ways to adjust to keep their business afloat. To keep their members in self-isolation fit, Method 3 Fitness studio owner John Heringer and other trainers have launched an online format where they host daily workouts and provide lifestyle tips. 

“It’s been going well so far,” he said.

Like Wiegand, he’s appreciative of his customer base. 

“Our members are absolutely unbelievable people, he said. “They’re hanging with us. They are appreciative of all the efforts that we’re taken so far.”

The online approach is a 21-day program where participants are emailed a daily quote, a schedule of workouts, healthy recipes, a food journal, and other lifestyle tips. Participants pay a $5 fee, where half of the proceeds go to paying the trainers and the rest goes toward gift cards from small businesses. Participants can win gift cards through the program. Heringer said they have already raised over $6,000 from over 100 participants in the span of a few days.

“It’s a really cool way for us to bring in some new business, but also really support other businesses like us,” he said.

Wiegand’s salon closing was also a chance for her to explore online ventures. She said she has been working on her website, adding all products for sale, including hair root touch-up kits. 

“It’s gonna help give us some kind of generated income, rather than nothing,” she said. 

To help local businesses, McGhie, the owner of 4th Street Pizza Co., advises Bay Area residents to buy their meals from small restaurants, such as a local burger place instead of McDonald’s. 

“The little guys, they’re gonna have a tough time,” he said. “That’s my thing: support the local businesses.”