16 Apr What Salon & Spa owners need to know about COVID-19 federal relief programs.
2020 rolled out, and we were so excited about the plans we had made for salon.marketing and the fantastic opportunities landing ahead of us. I still remember sitting in our planning meetings, thinking about how this booming economy was going to take us to the next level. We were on track to double our numbers in 2020!
Our latest victory at the time was getting accepted to Premiere Orlando as educators. I mean, my partners and I could not believe win after win. We had all hands on deck, from buying new technology and equipment to expanding our team. Life was good!
Then March rolled out, and we started hearing about event cancellations, travel restrictions to and from other countries, school closings, etc. But, honestly, I was so concerned about hitting our benchmarks, delivering high ROI to our clients, and dealing with all the current projects, that I had no time to breathe. I was in my la-la land. Parallel to my world was the real world; every person on the planet was now preoccupied, touched directly or indirectly by this invisible enemy.
With the majority of small businesses closed and our economy barely limping through, we have all wondered about the future. How are we going to get to the next month, and the next? Some of you may have a six-month reserve, but let’s be real; if you are a salon owner, your income is now zero. Your stylists are home, and your chairs are empty. Luckily, there are COVID-19 federal relief programs available to assist salon and spa owners.
If you are searching for assistance, here is a breakdown of the opportunities that are available to you. We are going to help you get through this and help you understand everything you need to know about the COVID-19 federal relief programs in simple terms.
Paycheck Protection Program (PPP)
What is this program?
The Paycheck Protection Program is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll.
SBA will forgive loans if all employees are kept on the payroll for eight weeks, and the money is used for payroll, rent, mortgage interest, or utilities.
How could you apply for it?
You can apply through any existing SBA 7(a) lender or any bank, federally insured credit union, and Farm Credit System institution that is participating. You should consult with your local lender as to whether it is participating in the program.
What are some of the general requirements of some banks?
Have an existing small business relationship with one of the following: A small business checking account.
Have a small business lending relationship, inclusive of credit cards.
Some banks will require the usage of their only portal only.
Contact your bank for their specific requirements.
When could you apply for PPP?
Lenders started processing loan applications on April 3, 2020. The Paycheck Protection Program will be available through June 30, 2020.
For more information visit the U.S Small Business Administration
If your salon does not run payroll, Economic Injury Disaster Loan Emergency Advance (EIDL) is the program for you.
What is this program?
This loan advance will provide up to $10,000 of economic relief to the businesses that are currently experiencing temporary difficulties. In addition to the 10K component, the SBA will review your loan application, and based on the needs of your salon or spa; additional loans could range up to $2M.
Who is Eligible for it?
This program is for any small business with less than 500 employees (including sole proprietorship’s, independent contractors and self-employed persons), private non-profit organization 501(c)(19) veterans organizations affected by COVID-19
How quickly could I get my EIDL?
The EIDL advance fund will be made available within days of a successful application.
Will this EIDL have to repay?
This loan advance will NOT have to be repaid.
How could I apply for (EIDL)?
To apply for COVID-10 EIDL click here
If you have an existing loan or relationship with the SBA, Express Bridge Loans might be the answer for you.
What is this program?
Express Bridge Loan Pilot Programs allows small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,000 quickly. These loans can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing and can be term loans or used to bridge the gap while waiting for a direct SBA EIDL.
What are the terms for this loan?
- Will allow up to $25,000
- Fast turnaround
- Will be repaid in full or in part by proceeds from the EIDL loan
Do you have a current SBA Loan?
If you currently have an SBA loan for Commercial or Mortgage. SBA is waiving up to six months of payments. Ask your SBA lender for details and how to qualify for this option.
Do you have private commercial loans?
If you have any other commercial loans, talk to your lender. Most lenders are offering some type of deferring payment program. All you have to do is ask!
I hope this breakdown of COVID-19 federal relief programs was helpful and provided some guidance. We offered our monthly clients the ability to differ April payments, while we will continue to work on their websites and their SEO. Remember that ALL of us are in the same boat, and together we will get through these challenging times!