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AN INDEPENDENT SUPPLEMENT BY MIA MEDIA & COMMUNICATIONS GROUP TO THE MIAMI HERALD
4 Steps Black Business Owners Can Take to Survive Pandemic
on certain recurring expenses. For example, instead of paying that monthly Quickbooks subscription, switch to a free accounting software like Freshbooks, Xero or Wave.
BY DANIELLE ST. LUCE
RISE Miami-Dade Fund & Black Business Initiative Fund It’s no surprise small Black-owned businesses have been disproportionately hurt by COVID-19. From February to April 2020, the number of Black-owned enterprises diminished by 41 percent, according to the National Bureau of Economic Research. Some of the decline is attributed to being in hard hit industries, like restaurants or retail. But much of it is associated with a historic lack of access to capital and the inability to move business online. Still, it’s critical to ensure small Black-owned businesses weather this crisis. Here are four moves entrepreneurs can make to protect themselves: RENEGOTIATE PAYMENTS Don’t be afraid to negotiate for better payment terms during the pandemic. Landlords and suppliers are often open to this because their own options are limited, too. Ask to defer payments for a number of months or create a payment plan. Remember, not every vendor will be amenable, so prioritize paying providers who won’t negotiate while you work with ones who are more flexible. CUT COSTS If you can’t increase income, you must cut costs. This pandemic should open your eyes to the expenses that are essential to keep your business functioning — and, just as important, what’s non-essential. Most business owners will cut their own salaries, reduce staff, and even break a lease. If these options aren’t viable, try chiseling down
REFINANCE YOUR DEBT Nationwide, interest rates have dropped to near zero, making now a great time to refinance or restructure debt. Start by calculating your prepandemic debt-to-income ratio by dividing your monthly debt by your monthly income. If your pre-pandemic DTI was above 30 percent, think about refinancing or restructuring your debt. Ideally, look for opportunities that will keep your monthly debt payments at or below 25 percent of your monthly income. One major opportunity are low-cost emergency loan programs that offer interest below 4 percent. Other opportunities exist with Community Development Financial Institutions, local credit unions, and community banks. Smaller financial institutions tend to have better rates and more flexibility than their larger counterparts. At minimum, you should be taking advantage of your lender’s forbearance options and penaltyfree prepayment, if available. TAP INTO EMERGENCY RELIEF FUNDING Emergency relief programs — like the federal government’s Paycheck Protection Program or the SBA’s Economic Injury Disaster Loan — can be a very safe way to protect your business. The RISE Miami-Dade Fund is an example of a relief program operating locally. It’s designed specifically for Miami-Dade small businesses, with fewer than 25 employees and less than $2 million in annual revenue, that have been hurt by COVID-19. Unlike most loans that require debt-to-income ratios, complicated lists of documents and a two-month wait to receive funding, RISE is easy and fast. The online application is simple, the list of required documents is short, and funds can be secured in as few as 15 days. Learn more and apply at RiseMiamiDade.com. n
WEDNESDAY, AUGUST 12, 2020
