Here’s how many small businesses are being left behind by government emergency benefits

If earnings from eight-year-old Julie Skirving’s clothing business continue to decline at their current rate for the rest of the spring and into the usually lucrative summer season, she said it may not come to fruition. ‘fall.

“I would have lost hundreds of thousands of dollars in income and it would be almost impossible to regain any ground afterwards,” Skirving said over the phone from Logan & Finley, her clothing store in trendy Queen Street West in Toronto, home to a myriad of independent businesses have run out of revenue since the coronavirus pandemic lockdown began five weeks ago.

The Canada Business Emergency Account (CEBA) loan program, which offers interest-free loans of $ 40,000, is supposed to help small businesses weather the storm, but some, like Logan & Finley, have fallen in the meshes of the eligibility net because they are just too small.

Skirving, which employs only three part-time workers, is not eligible for a CEBA loan because its payroll was less than $ 50,000 for fiscal 2019. Eligible businesses must prove they paid between $ 50. $ 000 and $ 1 million to their employees in 2019.

“The odds are stacked against me,” she said. “My ecommerce business only generates 7% of the income that I had before. I was turned down by the banks… it’s just really hard to get financing right now.

Since the pandemic hit, the federal and provincial governments have developed a variety of income support programs for businesses, including the CEBA, a 75 percent wage subsidy up to a maximum of $ 847 per week , loans from the Business Development Bank of Canada (BDC) and Export Development Canada (EDC), and a series of tax relief measures.

But none of these initiatives provide financial assistance to small independent businesses.

Even the CEBA fails when it is a program designed specifically to help small businesses.

Meg Watson, the owner of

Frances Watson, another independent clothing store in the Parkdale neighborhood of Toronto, i

is so furious that her business has been left out that she has put a sign on her store window that says “CEBA will not save us”. The tagline has since spawned a social media hashtag, #CEBAwontsaveus.

“Telling ourselves that we have to shut down our businesses and stay home without any security to do so leaves our hands tied,” she said. “We are doing our part for the greater good, but we cannot turn around like martyrs. ”

Just paying rent on her store costs $ 5,000 a month, Watson said, adding that she had suffered a 96% drop in sales since mid-March and had $ 60,000 in invoices due very. soon for a collection of spring clothes.

“Even if the economy comes back to life as Trudeau promised, I won’t have any product (to sell) – for fear that I won’t be able to pay to buy it,” she said.

We really are the kind of small businesses that need help … otherwise the list of us going bankrupt is going to be quite long.

Julie Skirving, Owner, Logan & Finley

The prospect of the closure of hundreds of small businesses – clothing stores, flower shops, nail and hair salons – is real and could dramatically change the cultural makeup of a city like Toronto, said Janet De Silva, CEO. from the Toronto area. Chamber of Commerce.

“We cannot let this happen,” she said. “Small micro businesses make our neighborhoods work and that’s why 80% of our recovery efforts are focused on mainstreet recovery. ”

An extension of CEBA’s eligibility criteria to include all companies, regardless of payroll amount, would be a good start, De Silva said, adding that some form of rent relief is crucial to maintain small businesses afloat.

The Toronto Region Board of Trade recently submitted a recommendation to the Ontario and federal governments proposing that landlords get tax relief on the rents they collect, which would help

the two landlords as they ask the banks to defer the mortgages and their tenants.

“If landlords don’t have to pay immediately, it spills over to their tenants,” De Silva said.

Sara Jameson, owner of Sweetpea flower shop in Toronto, agrees that rent relief is the only thing that could really get her through this crisis.

She said she finds herself in a unique situation because although she paid almost $ 300,000 in wages to her employees last year, she is not sure if her company qualifies for CEBA as she suffered a major restructuring in February which resulted in the company being registered as a new numbered company.

“If they rate the business as a new company, then I’m not eligible,” Jameson said. “If I get the loan, I’ll have over $ 80,000 in debt by August without a clear plan on how to pay it back. If I don’t get the loan, I’ll have to beg my landlord not to shut us out.

Prime Minister Justin Trudeau hinted at some form of rent relief for commercial tenants on Wednesday, although no details were given.

“I’m really grateful for what the government has done so far, and I don’t want to be the type of person who always complains,” Skirving said. “But we really are the kind of small businesses that need help… otherwise the list of us going bankrupt will be quite long.”

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