By Jenina P. Ibañez

SOME small businesses are seeking more government assistance, such as utility subsidies and lower rental rates as they struggle to stay afloat amid the extended enhanced community quarantine (ECQ).

Juan Miguel G. Eslava, owner of Cafe Juan Miguel, said in an online interview that his coffee shop in Imus, Cavite has lost 90% of its customers.

None of his employees are able to go to work as public transportation is suspended and coronavirus disease 2019 (COVID-19) cases continue to rise in the area.

Mr. Eslava and his girlfriend still run the café for loyal customers, sometimes making deliveries to nearby homes themselves and selling coffee beans directly to augment income. The Imus City government has also sponsored them to deliver food packs for frontliners.

The Department of Trade and Industry (DTI) earlier allocated P1 billion for a loan program for micro, small, and medium-sized enterprises (MSMEs) affected by the ECQ, and commercial rent can be deferred for 30 days from the last due date within the ECQ. DTI had also requested state banks for a P30-billion loan fund for MSMEs.

As the ECQ has been extended until May 15 for areas including Metro Manila and Calabarzon, MSMEs like Cafe Juan Miguel are struggling.

While he doesn’t have to pay rent, Mr. Eslava wished the government could provide some utility subsidies for MSMEs and transport assistance for workers.

Almost one million MSMEs were recorded in 2018 — accounting for 99.52% of businesses and 63% of the country’s total employment with 5.7 million jobs, government statistics showed.

The Department of Finance (DoF) has set aside a P51-billion wage subsidy for employees of small businesses, and is proposing an extension of the net operating loss carry-over to lower tax payments for small firms by two years.

DoF said small firms may lose P465.3 billion after they temporarily halted operations or reduced their work force during the ECQ.

Calixto Chikiamco, Foundation for Economic Freedom president, said in a BusinessWorld online forum that many MSMEs can afford to stop operations for only a month.

“In two months, they’re already out of working capital and I think facing bankruptcy,” he said.

Mahalia Joy Anne V. Agapito, co-owner and operations manager of Al Jograts Persian Grill in Sampaloc, Manila, said in an e-mailed response to questions that the store has been closed for a month to ensure the safety of employees.

“After a month of quarantine, we were forced to open our store to continue supporting our employees. Half of our employees were forced to stay home and were just given an allowance from us for their daily needs,” she said.

With the restaurant’s sales cut by 75%, Ms. Agapito said they now rely on orders made via food delivery services. While payments for rent and utilities have been deferred, she noted “daily sales are only enough to support our employees and their families.”

While the government has already extended the 30-day grace period for the collection of commercial and residential rents, Ms. Agapito said landlords should be required to cut rental fees by at least 50% during the crisis.

“They can also provide loans which do not require much document requirements to give a leeway for the daily cash flow concerns of small businesses. And making sure cash assistance is provided to MSME employees and their families,” she said.

Ms. Agapito said her business had reached out to the Labor department for the P5,000 financial aid for workers displaced by the ECQ, but has not yet received a response.

Philippine Chamber of Commerce and Industry — Quezon City President Sarah P. Deloraya-Mateo in a phone interview welcomed the loans for MSMEs offered by the government.

She noted there is a big gap between larger companies and MSMEs, as the former has bigger reserve funds.

Mga SMEs, wala ’yang masyadong savings. May mga utang ’yan kaya malaki ang effect. (SMEs don’t have as much savings. They have debts so the effect is big),” she said.

Many employees have not yet received subsidies.

Maraming no work, no pay ngayon although most of the employers nagbigay ng mga financial assistance. Pero alam naman natin na hindi siya enough for the employees. Inaasahan sana natin itong mga ma-re-receive from the government. (There are plenty of people under “no work, no pay” schemes now although most employers give financial assistance. But we know that’s not enough for employees. We are hoping for what we will receive from the government),” Ms. Deloraya-Mateo said.

While brick-and-mortar companies struggle with utility and rent payments, online food delivery services are doing well.

Raul Raphael P. Tesoro started Farm2Table in December, a company that delivers produce to consumers while cutting several middlemen.

He said in a phone interview on Saturday that the lockdown has improved demand.

“We’re currently expanding — a proper distribution center, proper storage,” he said, noting that recent events have leveled the playing field and allowed new players to come in.

“Normal forms of distribution and acquiring everything is gone,” he said, referring to centralized distribution and brick-and-mortar shopping.

The company encountered logistics challenges at local government checkpoints, adding that there has been some recent improvement in the movement of goods.

Mr. Tesoro plans to expand the company further and hire more employees.

But the rapid shutdown of business operations for manufacturing materials supply has slowed down e-commerce.

Handmade crafts company B&B Crafts lost online sales because they are unable to deliver goods during the lockdown.

“All of our sewers have a sew-from-home arrangement. We did not anticipate the ECQ so we were not able to stock up on the accessories needed for manufacturing the products,” B&B Crafts owner Leigh M. Tugot said in a mobile message.

She said operations will continue to be at a standstill during the extended quarantine. They plan to conceptualize new product lines and resume online delivery after the lockdown is lifted.

“Support of the government could be in the form of tax holidays for the year to make up for loss in the first semester of the year,” she said.

Meanwhile, Cafe Juan Miguel’s Mr. Eslava said he is working on plans to improve their online presence and expand their logistics services.

Ms. Agapito of Al Jograts Persian Grill also said that they will continue to fulfill orders through delivery apps and make more efforts to sell online.

“COVID-19 has really made an enormous impact on our business plans but as individuals we also understand the threat of it to humans thus, we’d rather struggle to survive this pandemic than to risk the lives of our employees,” she said.