Small businesses are the fabric and backbone of a community, but what happens when something like a pandemic forces them to shutter temporarily or rethink their operations?
How the public responds during and after such a crisis can make or break their fate.
Hyper Local Impact's Kristin Giant
As COVID-19 causes shutdowns and stay home orders across the U.S., impact investing
advocate and guru Kristin Giant of Fort Wayne says now is the time to re-evaluate how and where we spend our money as consumers. And perhaps this evaluation is long overdue.
“The pandemic is highlighting systems of inequality and inefficiency that already existed,” Giant explains. “The need to shop local and support local businesses and advocate for them existed last month and even last year.”
With this in mind, the COVID-19 pandemic is compounding anxieties that began long before its existence, forcing some small business owners to wonder what's on the other side of the epidemic.
Will things go back to "normal," or will a new normal exist? And most critically, will it be better or worse?
To fully understand the scope and scale of what’s at stake, Giant offers a few statistics. For one, Main Street businesses are some of the largest employers in the country as a whole, with millions collectively on their payrolls. Yet, about 50 percent of these businesses were fewer than 15 days from running out of cash before COVID-19. Perhaps most sobering is the fact that, on average, 85 percent of businesses fail within five years.
In other words, small business owners don't have much room to absorb the blow of COVID-19, and are thus, at the mercy of the community to help them weather this uncharted territory.
“What that looks like on a day-to-day basis is choosing local first, and then finding other ways to engage right now,” Giant says. “I think one of the big needs right now is to advocate to our local, state, and national representatives to include Main Street businesses in whatever bailout packages are coming.”
Similarly, if there’s one key takeaway for small business owners and supporters alike, it’s that we’re all in this together. In the event of a crisis, some quickly discover that social capital can be the last remaining safety net upon which they can rely. Giant says she’s seen some heartwarming acts of solidarity in Fort Waynes' community the past few weeks as people put their differences aside for the common good.
“Leaning into relationships right now becomes important,” she says. “My hope is that this becomes a new habit, too, because research shows there's a link between the presence of diverse locally-owned businesses, and better health, economic stability, and resilience.”
While Giant acknowledges the contributions of chain or franchise retailers also matter in communities, she poses a rhetorical question to consumers when making the choice between shopping local or going with a corporate alternative.
“Support what you want to be there in the future,” she says.
For example, say you like to dine at a chain restaurant regularly. Giant says there’s nothing inherently wrong with supporting such an establishment. She does, however, challenge people to think bigger and more long term in their decisions.
As she puts it, “It’s the businesses that are indigenous to our city that make Fort Wayne Fort Wayne.”
The much-revered Fort Wayne’s Famous Coney Island
is one example of the city's flavor, Giant says. There's a reason this purveyor of coney dogs is on T-shirts and postcards: It's a local landmark, and people take pride in its "unique character."
Economics also frame the argument. Local, independent businesses, generally speaking, recirculate about 48 percent of their revenue within their community, compared to only 14 percent for chains or franchise establishments, according to data from the American Independent Business Alliance.
Along with being important reminders in the era of COVID-19, these points are also factors in Giant's recent decision to launch her own consulting business in Fort Wayne this spring: Hyper Local Impact
Having built her career working for impact investing pioneer the Impact Finance Center
in Colorado, as well as Ambassador Enterprises in Fort Wayne, Giant's vision for her company is to bolster small and independent businesses and nonprofits, which are often the most vulnerable during economic downturns.
As the country faces a recession, her work is timely.
“The overarching goal of Hyper Local Impact is to rebuild an inclusive local economy, acknowledging that we win when everyone in our community is building wealth and security,” she says. “It's about helping individuals, for-profit businesses, and nonprofits rethink the way that they deploy dollars to do it in ways that make the most sense for our community, as a whole.”
Giant says her inspiration to launch the enterprise comes from her tenure at Ambassador, which manages the exit earnings of Daryle Doden's company Ambassador Steel. She’s slated to leave the organization at the end of the month, but it has left an indelible mark on her and has opened her eyes to what it means to put impact investing into action, she says.
“Daryle Doden at Ambassador has been a huge motivator and inspiration for launching this," Giant explains. "He’s shown me how having concentrated resources deployed in a narrow geographic region can have an outsized impact.”
According to Giant—who has lived in several cities before relocating to Fort Wayne—the Summit City’s size naturally lends itself to a spirit of collaboration. There’s not as much red tape here as there is in bigger places, so it’s easier to effect change in a timely manner.
Overall, she’s optimistic about the community’s prospects to recover from COVID-19 and make its future even better than its past.
"There's a real openness and willingness to collaborate and think in innovative ways in Fort Wayne," Giant says. "That makes me excited to focus all my energy here.”
Additional resources for small businesses
Startup accelerator gener8tor is hosting emergency one-week virtual programs for small businesses affected by the COVID-19 outbreak. To learn more about the Indiana Emergency Response Program, visit their website.