Coronavirus is forcing small businesses to close for good: ‘There’s nothing we can do’

It’s a cloudy Sunday afternoon and Rachael Flynn is sitting in the middle of her homey two-story Mount Airy salon, at times appearing shell-shocked, as her sons haul a heavy cabinet down the steep staircase to the curb.

Here, inside Culture Hair Studio on Germantown Avenue, trays, carts, and styling chairs are strewn haphazardly around the room. Flynn has sold some, donated others.

The end has come.

“Every time I come here to move out, it’s emotional,” she said, sitting near the lacquered vintage wood countertops she had carefully picked out five years ago. “It’s been a roller coaster. Yesterday I was so grief-stricken, I couldn’t talk to anyone. Many nights I can’t sleep.”

She stares at an old thrift-store-bought wooden bureau that reminds her of her kids when they were young. She can’t stand to part with it.

“You should keep it, Mom,” said her elder son, Julian, 23, taking a break from emptying the storefront with his brother, Brent.

“My mom has had this business as long as I remember,” he said. “She was proud of building it. It was her baby. To see it shut down is upsetting, to say the least.”

Flynn’s business is drowning under the first wave of the worst economic tsunami since the Great Depression.

Despite government’s efforts to save small businesses from the wreckage of the coronavirus pandemic, many are already shuttered or on the brink. Economists estimate that more than 100,000 businesses across the nation have closed permanently since March, according to a study by researchers at the University of Illinois, Harvard Business School, Harvard University, and the University of Chicago.

More than one in five small businesses say they are two months or less from closing, according to a MetLife & U.S. Chamber of Commerce poll released earlier this month.

Small businesses have always been at risk of failure. Some 30% fail in their second year and about half die after five years, according to the Bureau of Labor Statistics. But for some, the pandemic has accelerated the deathblow.

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Restaurants, bars, salons, hotels, and small retail shops are particularly hard hit. Three Philadelphia-area restaurants recently announced they were closing: Farmicia in Old City, Mad River Bar & Grille in Manayunk, and Vitarelli’s in Cherry Hill, which opened in 1975 as a deli and grew into an Italian BYOB and catering facility.

For Inspired Brews Fermentary in Old City, the pandemic put a nail in the coffin. It is shutting down after 6½ years, founder Jessa Stevens said.

The kombucha brewer didn’t see its usual boost in sales when spring arrived, and its distributor wasn’t able to order as much either. Inspired Brews sold much of its supply to small mom-and-pop shops that are now closed.

“Financially, things have been hard anyway in the past a little bit,” Stevens said. “I think just taking this extra hit was a breaking point.”

Heartfelt messages continue to pop up on Facebook, with business owners penning their final goodbyes, often beginning with the words that Flynn used to announce the closing of Culture Hair Studio: “It’s with a very sad heart …”

It’s one of the most gut-wrenching notes she has ever written.

Flynn, 49, had launched the salon 16 years ago when she was a divorced mom of two young sons. She later added two business partners, Annie Hauser and Amy Lydon, and 10 other employees, providing health insurance, a retirement plan, and paid vacations.

At the beginning of the mandatory shutdown, Flynn thought they could stay afloat.

She applied for a loan through the Paycheck Protection Program for small businesses. As of May 23, Pennsylvania ranked in the top 10 in the nation for the amount of money small businesses had received under the federal rescue program. Flynn’s business, unfortunately, wasn’t one of the lucky ones. As the weeks slipped by, the situation became dire.

“We plugged in all the numbers on an Excel spreadsheet and realized there’s no way,” Flynn said.

“There’s no money left. We couldn’t do it,” she said, her voice shaking. "There’s nothing we can do.”

Other businesses are hanging on — barely.

“Of my three businesses, only one is still open,” Terrell Barkley said. That’s his Brewerytown soul-food restaurant, Barkley’s Barbecue on 29th Street near Ridge Avenue, which he opened in 2014.

Barkley will permanently close his concession stand at 30th Street Station. And even though he is now allowed to operate his food truck, he decided to not reopen it — at least for now.

“I’m not sure it’s safe," he said. "And the Amtrak location, I think I will just take the loss. Cases are still growing in number and I want to stay healthy.”

“I’m down about 80% in sales,” Barkley said. “We worked hard to get to this point. I had a big opening at the Amtrak station this year. I put a lot of money invested in getting in there, and our numbers were looking good. People found out we were there and were loving our food.”

“It’s really dim right now," he added. He was lucky enough to receive a $5,000 grant from The Merchants Fund to help stay afloat.

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Neighborhood bar owners also can’t fathom the future.

PJ Dolan owns the third-generation family-owned Dolan’s Bar in Ridley Park. “It’s been my life. It’s all I know,” he said. He started working there as a kid washing dishes.

“I’m not at the point of considering closing, but I don’t see how social distancing would ever apply to a small neighborhood bar,” he said.

The bar, which regulars know as the quintessential Irish American dive bar and has won the “Most Delco Bar” award, seats 30. “It’s walls and bar,” as Dolan puts it. To sit six feet apart, only five or six customers could be permitted inside at any given time, and they’d have to walk by one another to reach the bathroom.

“How do you pay bills if you’re not maximum capacity?” he asked. “Our weekends pay our bills. Even if we open, we may not survive. ... People who own the bricks can hang on longer. We’re lucky that way. But other people, I know they’re really sweating.”

“This is uncharted waters,” Dolan said. “Everyone is looking for the balance of health and economic health. What’s the answer? I don’t know."

The increasingly acrimonious debate over how to reopen businesses while weighing the growing economic pain against the ongoing public health threat has left some business owners distressed.

“There’s such a divide between the people who feel like we should be on lockdown for a very long time and people who feel the need to get back to work and take proper precautions,” Flynn said.

“You can be someone who wants to go back to work and still love and care about people,” she said. “It’s not mutually exclusive.”

After Flynn announced on Facebook that Culture was closing, most people were empathetic and wrote how sad they were. But a few accused her of putting profit above human life because she wanted to reopen.

Hair stylists and cosmetologists are trained how to sanitize their workspace, she said. “I don’t feel like our governor is giving salons a fair shot," she said. "We’re smart and capable. We could open with proper safety precautions.

“But we weren’t given that opportunity,” she said.

“It was taken from us.”

At the same time, across the city in Fairmount, Elvira Aslanova was closing her salon, too. She’d had Beehive for 11 years and had just redecorated with new cherry wood swivel chairs, bleached oak mirrors, and canvas art of Marilyn Monroe and Audrey Hepburn — for an old Hollywood glam vibe.

"We were ordered to shut down Monday, March 16, and I remember like it was yesterday,” she said. “We were told it would be two weeks. I called a lot of clients and rescheduled everyone for the beginning of May.”

The green light to open never came. Her landlord told her he could lower the rent by $1,000 for the next three months. “But I’d still have to pay $2,000. When you’re not making a single cent, it’s a lot of money,” she said. Or, the landlord told her she had three months to vacate with no penalties. She decided to pack it up.

“Emotionally, at first you think it’s OK. It’s for the best. It’s the beginning of a new life,” she said. “Then you take the artwork off the walls and you hear from clients and you realize that’s it. It’s gone.”

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Aslanova didn’t just live the American Dream. She is the American Dream. Now 43, she came to the United States from Baku in the former Soviet Union with her family when she was 14. Because they had fled violence and torture, they were granted refugee status.

“It's a land of opportunity. It's a land of dreams,” she said.

She always worked. As a kid, she chopped up vegetables and made salads for Franklin and Marshall College. She made $4 an hour. “You do what you have to do to survive,” she said.

After cosmetology school, she worked for other salons before deciding to take a leap and open Beehive. She had four employees.

Katherine Zaleski was one of them. She had worked at Beehive for two years and now worries about what’s next.

“When I can’t see the future, I get anxiety,” she said. “I’m learning to take it day by day. But for any hairdresser, it’s like a bomb that dropped in our lives.”

Aslanova, a single mom of a 7-year-old boy, said she couldn’t sink deeper into debt.

“We were doing well. This was supposed to be our best year. Nobody saw this coming,” she said. “But I can’t live with this uncertainty. I have to take care of my child. You should never have a business that is costing you money. You need to know when to walk away.”

Aslanova will return to her old stomping grounds at Spa Elysium in Chestnut Hill, where she used to be a stylist. “It will be like being back home,” she said. “Now I have to start over. I can take my crown off. I will do whatever I have to do.”

For now, she is collecting unemployment and trying to stay positive. “I believe that the only things you can lose are your life and health," she said. "Everything else, you can rebuild.”

But it’s still painful to walk away.

“This country gave me everything I ever dreamed of,” she said.

“And now corona has taken it away.”

Staff writer Christian Hetrick contributed to this article.