One thing I know most of you are sick of hearing about is that small business is the backbone of the United States. But the fact is the cliché is right: a vibrant country needs growth and small businesses provide the growth we need to prosper as a nation. They spend, they spend on hiring, on physical buildouts and on commerce. Big business, ex tech, has been trying to trim its payrolls for years. The larger companies almost seem proud about their restructurings -- a code word for firing -- because it raises the earnings per share that stock holders want so badly.
But the companies I am talking about don't have stockholders. They are businesses that run franchises or own restaurants and retailers. They create. But they tend to not be well-capitalized. And, we discovered from the pandemic, not essential. According to Fed Chief Jay Powell, 20 million people have lost their jobs and those jobs have come from the backbone we are talking about. When you talk about the fabulous numbers from Walmart (WMT) or Home Depot (HD) , think that those numbers came at the expense of the backbone, too.
Now the Treasury Secretary did come up with a novel plan to keep workers on the payroll during the pandemic by shoveling small and medium-sized businesses loans to keep workers on the rolls, loans that turn into grants if you keep your businesses open. In full disclosure our restaurants took money from the Paycheck Protection Program and it's been the difference between closing and staying open. After all, we aren't allowed to be open, so what the heck were we supposed to do? The plan's a brilliant one.
That said, I have a nagging feeling that many restaurants will not be able to keep going after they accept the money. The social distancing rules make most restaurants dependent on takeout and delivery. The lack of patrons is forcing retailers to develop an e-commerce system that is efficient and works.
So is the backbone being ripped out?
No, actually, it is shifting, shifting away from brick and mortar to your house or your workshop or your garage.
What's happening is people are creating things, making things, baking things, and selling them on-line in businesses that are powered by Etsy (ETSY) or Shopify (SHOP) . Welcome to the new world of the sole proprietor artist who has something to offer that we all crave: handmade goods that can't be gotten at the now godforsaken mall.
I know it's small right now. But in a world of lay-off and quarantine, and often heartless landlords who own buildings and don't need the rent money, these micro businesses are thriving. They are using Wix (WIX) to develop websites that look no different from the big boys,. They are using Adobe (ADBE) for a design and commerce. They use Square (SQ) at the register and they take PayPal (PYPL) . They can Zoom (ZM) you a demonstration and they can do so while under quarantine or when the shoppers are bound to home, correctly concerned about going to a store that may not be covid clean. They can flag specials with Twilio (TWLO) . They can get it to you fast via FedEx (FDX) or Uber Eats (UBER) or Postmates, and Grubhub (GRUB) and Doordash.
Now this cohort is not going to replace the substantial bar, restaurant and retail ecosystem we have built that was a hiring a machine. But it is something that can use Facebook (FB) or Instagram to show what they have, and then sell those handmade masks or those delicious cookies or those fantastic pillows and handmade tools. You want to see their handiwork. Explore Etsy. It's amazing, a celebration of small business creativity unleashed by a pandemic that will never be snuffed and this wave deserves our patronage and our money.