These Winnipeg businesses say they're on life-support after new pandemic restrictions
Canadian Federation of Business says micro-businesses, sole proprietors are falling through the cracks
This spring, Carla Deroy began wondering whether she should pay the rent for her retail shop.
Sales at her Winnipeg beauty products store were down more than 75 per cent and cash was tight.
The federal government's commercial rent assist program hadn't yet been announced, and tension was rising in her family as their financial situation worsened. She remembers thinking, "At the end of the day, I don't want to come here and find out that they changed the locks on the store."
Deroy took a chance and held off on paying her rent. Then, federal rent assistance kicked in and business picked up over the summer as people's comfort level with the pandemic eased.
It seemed the tide was turning — but now, Deroy is back in a similar predicament.
The store she founded, the Beauty Box by Sheriff, has a retail location on Ellice Avenue, and offers online classes and an e-commerce site. But it's struggling to survive the second week of increased restrictions in Winnipeg, which is under the orange, or "restricted," level on the province's pandemic response system.
The Canada Emergency Commercial Rent Assistance program has ended and its replacement has yet to be announced.
"We're just kind of taking things day by day … and we're doing a lot of praying and trusting that God will get us through," Deroy said.
The biggest blow to her business is the current gathering limit of 10 people. It's meant bookings for weddings, glam parties and children's events have been postponed — again. Foot traffic in her retail store has slowed down too.
And because neither she nor her two daughters, who run the business full-time, were on a formal payroll, they're not eligible for the federal government's wage subsidy, which pays up to 75 per cent of an employee's wages. Instead, they collected less through the Canada emergency response benefit.
It's a concern affecting family-run businesses across the country, according to Corinne Pohlmann, the senior vice-president of national affairs for the Canadian Federation of Independent Business.
"So many small businesses pay themselves and their family members dividends, and not through salaries," she said in an interview from Ottawa. Only about 30 per cent of CFIB members have seen their revenues return to pre-pandemic normals, she said.
It's just one example of how small businesses are falling through the cracks with government assistance, she said, and the CFIB is pushing the federal government to allow pandemic-affected business owners who collected dividends to be included in some kind of federal aid.
She gave the Canada Emergency Business Account as another example. The program makes a partially forgivable $40,000 loan available to owner-operated small businesses. But it requires them to have a business bank account and non-deferrable expenses of at least $40,000.
Pohlmann said lots of micro-businesses don't have business accounts or meet the required expense threshold. "It ended up kind of again eliminating a whole swath of businesses that may not have quite reached that 40,000 [dollar mark]."
Sheila Bennett got the loan, but then realized taking the assistance would mean she would have to pay back a $6,000 forgivable loan from the province.
Bennett owns Kitchen Sync, a licensed commercial kitchen and private event venue in the Exchange District, that's now on life support.
She too had clients cancel events due to the new restrictions in Winnipeg. Like Deroy, Bennett said many events had already been postponed from earlier in the year.
'Not an even playing field'
One family recently cancelled a bar mitzvah for 21 people — down from the 60 who were originally going to attend earlier this year.
"I was devastated," she said. "I feel bad for them, because what do you think they probably did? Squeeze into somebody's house, which is exactly the opposite of what we're trying to do here."
Bennett feels like she's been forgotten by the provincial government, and doesn't think it's fair that restaurants, bars and casinos can still open with more than 10 guests. The current provincial order makes it clear weddings, funerals and banquets are all required to abide by the limit, with few exceptions.
"It's not an even playing field," for businesses like hers, she said. "We have spent time and money figuring it out. It's our reputations, and a lot of us have been around for a number of years. We're not going to do anything to tarnish that."
She doesn't know if her business will survive if the Winnipeg restrictions last longer than the currently planned one month.
"I do worry. I've been worried since March. How could you not? It's five years of blood, sweat and tears here."
Back at the Beauty Box, Deroy is helping mentor her 13-year-old daughter, Cassidy Busby, a Grade 9 student at Glenlawn Collegiate. Busby has come up with a creative concept to solve a mask hygiene problem.
She's selling colour-coded masks designed for students. The concept is simple: they wear a new numbered mask three times a day, with a different colour for each day.
The masks are Busby's response to a challenge from her mom to come up with a business idea while being home-schooled during the pandemic.
"My mom had told me, 'You're not going to sit at home all day and watch TV. You're going to put your mind to something.'"
WATCH | Small businesses struggle under new COVID-19 restrictions:
This story was possible in part thanks to Manitobans who filled out CBC's survey about the financial impact of the pandemic. In it, we asked Manitobans to share their top concerns and questions about the personal economic impact of the pandemic.
For more stories about the experiences of Black Canadians — from anti-Black racism to success stories within the Black community — check out Being Black in Canada, a CBC project Black Canadians can be proud of. You can read more stories here.
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