This past month, corporate lobbyists swarmed Washington to get the best shake for their industry from the Senate’s coronavirus relief bill. However, with no power to arm-twist, small businesses have found their interests overlooked as their sales plummet. Middletown’s downtown Main Street is a paradigmatic example of how small family owned businesses with less than ten employees have been impacted by the COVID-19 pandemic. 

Touted by the town’s politicians, the burgeoning main street area has seen a boom in recent years with a number of new restaurants and stores opening up shop, making it a competitive new hub for business. 

Yet, as new restaurants and stores were just on the cusp of getting their financial bearings and older restaurants were adapting to this new competitive environment, the COVID-19 pandemic has thrown a wrench into day-to-day business.

“We’re incredibly proud of our downtown main street which has been really strong and we need to come together to support them in these times,” Mayor Ben Florsheim said.

Most restaurants already run on razor thin margins just to stay afloat, and now, many don’t know if they will be able to survive the pandemic slowdown.

“Business is way down and we are barely making it on the number of orders we’re getting right now,” the owner of Tibetan Kitchen, Sherab Gyaltsen, said. “It’s been really difficult so far, and we are just hoping we can get through this period.” 

On March 16th, as an early effort to curb the spread of coronavirus, Governor Ned Lamont issued an executive order that ordered all non-essential businesses to close and restaurants to switch to only serving takeout and delivery. With this new emergency measure, small businesses scrambled to figure out how they would survive through the coming months. In the subsequent weeks, businesses saw a dramatic drop in their sales numbers with some restaurants reporting a seventy to eighty percent decrease. 

“Because many of our downtown restaurants like mine have had to scale down our business operations so greatly, we’re seeing some of the hardest times that we’ve ever gone through,” Chu Ngo, the owner of Lan Chi’s Vietnamese Restaurant, said. “Our sales are down eighty percent because we’re not seeing our regular customers come in anymore.”

Ngo, along with other restaurants and local community organizers, patched together a food drive to provide affordable meals to those impacted by business and school closures. This drive not only provided food to over 2000 people, but served as a small source of income for struggling restaurants. 

Since transitioning to a takeout/delivery model, restaurants have not been getting enough orders to maintain anything close to their typical numbers. For Tibetan Kitchen, they are only getting around four or five take out orders on week nights, while on weekends they receive a larger amount of orders. 

Part of the issue for restaurants, however, is that they’re getting more delivery orders than take out. This means that restaurants have had to start relying on Uber Eats, Door Dash, and GrubHub delivery services, which ask for a hefty cut of profits. 

“Uber Eats and Door Dash Delivery are hurting us because of the fees they charge to do delivery,”  Ngo said. “Uber Eats can ask for 30 percent of the sale in many cases.” 

For a restaurant like Ngo’s that can seat over a hundred people and didn’t even offer delivery before the pandemic, switching to delivery service apps has come at a great cost. She’s had to reduce the options on her menu to cater more for delivery and take out orders. 

But for some restaurants, delivery is not even worth the fee that the apps charge. Even though their sales have been hit by seventy percent, Thai Gardens has decided not to pay delivery services and instead just do takeout from the restaurant. 

“We don’t partner with Uber Eats  or DoorDash because it’s too much for the fee and we can’t afford to lose that much revenue,” Nuntiya Sripa, the owner of Thai Gardens, said.

Meanwhile, liquor stores have been allowed to stay open as essential businesses, but to their own challenges. For Forest City and Metro Spirits, foot traffic has been minimal because of the stay-at-home policy. Although liquor sales around the state of Connecticut have surged during the pandemic, Forest City has not experienced that boom. 

“Our sales are down by about thirty percent or forty percent and we have a lot of clients that aren’t coming anymore,” Abhay Sheth, the owner of Forest City,  said. “The only reason that our numbers are not lower is that people have been stocking up in bulk recently to prepare for the month-long shutdown we’re expecting.” 

With liquor vendors in particular, the pandemic has disrupted an entire commercial ecosystem. To manage costs, stores like Forest City have been forced to cut down their hours of operation and are purchasing less from liquor distributors, since the stores only have a thirty day credit to sell the liquor and repay the distributor.

Another reason Forest City has been hurting is because their customer base centered largely around University students, most of whom have returned home. 

“Wesleyan is a big buyer and we’re very popular for students, so that’s been affecting our foot traffic the most,” Sheth said. “We also relied on Wesleyan student workers heavily that we don’t have anymore.” 

While Forest City used to employ five or six Wesleyan workers, they now only have two other part time employees to help run the store. 

“Because we’re not getting as many customers, we don’t need as many workers and can’t afford anyone full time,” Sheth said. 

As restaurants have downscaled their operations, they also have had to lay off workers. Restaurants like Tibetan Kitchen and Thai Gardens used to employ three or four workers, but now only employ one. Since they’ve moved exclusively to take out and delivery, part-time positions like dishwasher have now become obsolete. While it’s seen as a matter of financial necessity for many restaurants, layoffs have taken a toll on the social bonds between owners and employees. 

“It’s really tough because our employees are like family,” Ngo said. “It’s a small business so we’ve very close with the workers and in these times it’s like saying to your relatives, ‘I’m sorry but I don’t have the finances to support you.’”

With the passage of the Senate relief aid package on March 26th, an estimated $377 billion has been allocated for companies across the country with five hundred employees or less through emergency grants and forgivable loans. In addition, Mayor Florsheim and the common council has been working with the Middlesex Revitalization commission and Economic Development Fund to potentially offer more funds to struggling Middletown businesses. 

However, some restaurants have reservations about whether or not federal and state relief can really help their businesses stay afloat. 

“I just don’t know what they can offer us that will be helpful in the long run if this continues,” Gyaltsen said. “It’s a lot of paperwork to go through and all the things you have to list down so I just don’t know we have the time right now because we’re struggling to try and keep things running here.” 

Unfortunately, in the case of other businesses downtown, the relief might have just arrived too late. Moonlight, Pokemoto, Eli Cannon’s, Perk on Main, and Forbidden City Bistro have all closed down indefinitely this past week. 

Even for someone like Ngo, who has gone through many transitions in her life, from emigrating as a kid to the United States from Vietnam, to making a mid career switch into the cut-throat restaurant business, the pandemic might be one of the most disruptive transitions she’s experienced. Yet, Ngo has hope that the close knit community of restaurants in town that welcomed her as a newcomer seven years ago can pull together and get through the hardships that the pandemic will bring. 

“It has been very difficult to see the business that my mother and I built from the ground up go through these difficult times but I’m not going to give up,” Ngo said. “I have put too much hard work and dedication into this business and have made too many sacrifices to get to the point where it is now so I will fight to keep it alive and use every option available.”

 

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Luke Goldstein can be reached at lwgoldstein@weslyan.edu