The COVID-19 pandemic has forced life as we know it to a halt in Baltimore and across the country.
As only essential business operations continue and many companies must shift to work remotely, our favorite restaurants, music venues, barber shops, nail salons and other local businesses have been ordered to close. Though these closures are meant to be temporary, many businesses will be forced to shutter permanently, unable to weather the economic impact of COVID-19.
Baltimore is a city whose economy relies heavily on small businesses, especially family-owned, as well as minority and women-owned businesses. As a proud native Baltimorean and longtime Baltimore business owner, I understand and recognize that our small businesses are the lifeblood of our city. Now, more than ever, Baltimore City’s leaders need to recognize the value of small businesses and lift them up during these challenging times.
There are several initiatives Baltimore leaders must implement to help small businesses survive this crisis.
City leaders must recognize the severity of the impact this virus is having on our business community and act immediately to help. Most small businesses are not flush with liquidity to keep them afloat for more than a month without incoming cash flow. If a business runs out of cash during this time, it will be forced to close its doors. The old adage that “cash is king” is especially true for our local entrepreneurs.
As a business owner in Baltimore City, I know first-hand the challenges vendors face in being paid on time for various projects and contracts with the city. Our leaders need to take immediate action to protect our small businesses. This can be accomplished by having the city of Baltimore commit to consistently pay its vendors on time.
Mayor Jack Young should mandate that the city pay all its outstanding invoices to its local vendors within the next seven days. Going forward, the mayor should make a commitment that the city will pay local vendors within 15 to 30 days. This is an easy, obvious step the city can take to help provide a direct flow of funds to small businesses with city contracts, especially at a time when other sources of income may be drying up.
City leaders should also immediately create what I call ‘entrepreneurship support SWAT teams,’ or teams of professionals that are mobile and can provide stabilization and continuity to our at-risk businesses. The main thing small businesses need right now is to replenish the cash that has been lost due to COVID-19.
These SWAT teams should be formed through partnerships between the city and Baltimore based law, accounting and technology firms that are willing to volunteer and lend some of their time to help the businesses that make up our community. These professionals would provide immediate consulting, accounting, legal and technical assistance to businesses most affected by the COVID-19 pandemic – with the goals of helping to inject cash back into small businesses and helping stabilize them during these hard times.
Finally, city leaders must recognize that the resources needed to keep our local businesses afloat are not all going to come from within the city. Many of these resources will come from the state and federal level, as well as the private sector. As the business landscape changes rapidly, there is an influx of new information and resources. City officials and city agencies, in close partnership with the Small Business Administration’s Baltimore District Office, must provide better guidance and act as a conduit to facilitate the rapid flow of resources to our businesses in Baltimore.
In times of crisis, small businesses need three things – predictability, faith in our governing institutions and, most importantly, cash. If our city government can facilitate those three things, then many of our small businesses will be able to survive this exceptionally trying time.
If the COVID-19 crisis has shown us anything, it has helped to illustrate the difference between the kind of leadership our city needs in times of crisis and uncertainty and what we have historically received. As we emerge from this pandemic, and we will, the evidence of which of our local leaders provided effective leadership during this crisis, and those who failed our city yet again, will be painfully clear.
Robert L. Wallace (RWallace@bithgroup.com) is a Baltimore business owner, engineer, entrepreneur, author and business consultant. He is the founder and chairman of BITHGroup Technologies, a Baltimore-based technology company.