Businesses Struggle to Regain Financial Footing

BUSINESSES STRUGGLE TO REGAIN FINANCIAL FOOTING

Contributing Reporters on this Newscast: Yuxiao Yuan

State and federal loans are available to help small businesses heal from storms. Even though the snow and extreme cold are gone, many Somerville businesses are still recovering from the harsh winter.

“When we didn’t have many guests in January and February, we still had our expenses. We depleted out our cash basically and that is not yet back,” Diana Kudajarova, the owner of Journeyman at Union Square, told the Somerville Neighborhood News (SNN).

Kudajarova said restaurant sales were down 25 percent in February compared to the previous year. Journeyman was not alone. Many other restaurants in the city also experienced substantial losses, especially on Valentine’s Day.

“There was a lot of snow outside this Valentine’s Day,” said Roberto Rendon Jr., the manager of Cantina La Mexicana. “A lot of customers canceled their reservations.”

“Typically a lot of businesses will have a big weekend that allows them to pay the bills for three or four months after that,” said Maxwell MacCarthy, the Urban Revitalization Specialist for the city’s Economic Development Department, “For businesses that depend on Valentine’s Day, they didn’t have that. It was really, really tough.”

To help businesses bounce back, the Massachusetts Growth Capital Corporation is offering low interest loans that range from $5,000 to $10,000. Eligible businesses need to have been profitable before the 2015 snowstorms and have to pay back the money in three years.

Magpie Kids on Elm Street took advantage of the loan program. “Getting a loan really helped us. It gave us some capital to keep going in March and April right after the winter,” storeowner David Sakowski told SNN.

However, for new stores without a financial record before 2015, the owners have to figure out more creative ways to increase business.

BeadKreative, a jewelry store on Somerville Avenue, opened last July. “Going through this hard winter was even harder for us because this was our first year of operation,” owner Milla Castillo told SNN. “There was one period of time that we went ten days without any sales.”

To bring in more customers, Castillo has been holding Open Mic events in the store every month since May. Residents are invited to come and sing. Castillo hopes this event will create greater community visibility for the store.

The Economic Injury Disaster loan provided by the U.S. Small Business Administration has also been created to help those affected by the harsh winter. Businesses can apply for up to two million dollars with terms up to 30 years.

Somerville local community groups are also lending a hand. “#Somerbliss” is a social media campaign going on throughout the month of June to encourage people to shop and eat locally. Patrons can tweet out their comments after visiting a local business using #Somerbliss. The business with the most mentions will get free memberships to Somerville Local First, Somerville Chamber of Commerce, Union Square Main Streets, and East Somerville Main Streets.

“[It] is a way to help our businesses recover from the money they lost through this really hard winter. It’s also a great way to enjoy what Union Square is offering at the same time,” said Esther Hanig, the executive director for the Union Square Main Streets.

Somerville Neighborhood News is a production of Somerville Community Access Television, made by professional journalists, volunteers and staff. The half-hour news show has as its mission to provide a lively, informative newscast focusing on the events, issues and information impacting Somerville residents.