There’s no denying that a lot of businesses are hurting this year. The economic struggles brought on as a result of the coronavirus pandemic have left many businesses grasping at straws and struggling to stay afloat. While many businesses are suffering regardless of industry, some industries have been hit much harder than others. These are some of the industries that can benefit from a small business loan right now.
The energy industry is essential to life as we know it today. From the electricity that powers our technology, to the gas that heats our water and the oil that keeps our cars running, we rely on this industry at virtually every point of every day. The gas and oil industry has suffered greatly during the pandemic. People aren’t traveling nearly as much, and many have transitioned to working from home. The demand for gas and oil has plummeted as a result, causing the prices to drop significantly. This has significantly cut into profit margins. It doesn’t help that China, one of the world’s top 10 oil consumers, was the source of the virus. The resulting shutdowns and decreases in profits have increased the probability of gas and oil companies defaulting, though that risk has dropped since it first shot up in March.
One of the headlines that made the news early on in the weeks following various shutdowns across the country was that farmers didn’t have the demand for their products they had anticipated. This resulted in a serious dairy product supply chain disruption that left many with no choice but to dump their raw milk. Other farmers had similar experiences with eggs and a wide variety of produce. The schools and restaurants responsible for a significant portion of the demand were closed, and the grocery stores were initially unable to keep up with the demand of consumers who were panic buying. While there may be some government compensation for the destroyed crops, it’s not likely to be as much as they would have been sold for, and expenses are unlikely to decrease as a whole. Small business loans for farmers could help make up for such losses and provide the funds to pay for those costs that would have normally been covered by the profits gained by selling their crop.
The transportation industry relies on moving as many people at one time as possible. Under normal circumstances, that isn’t usually a problem, but with the social distancing guidelines set forth by the CDC, packing people into relatively small spaces doesn’t work so well. Airlines and other transportation companies that rely on meeting certain capacities to stay afloat have been especially hurting. The idea of being in a confined space with lots of people close by when that increases the risk of contracting the virus doesn’t sit well. With more people telecommuting, the demand has dropped, making it difficult to turn a profit. Airlines have been taking measures to improve flier safety, but people are still wary of flying. Until there is a vaccine readily available and case numbers drop and stay down, that isn’t likely to change.
In the early stages of the pandemic, many restaurants were forced to close their doors while the nation raced to better understand the virus. Some were able to keep operating by adding and relying on takeout and delivery options, but it hasn’t been enough for others. Restaurants have overhead costs they are responsible to pay regardless of the economy’s condition. They still have rent, utilities, and staff to pay. Some costs can be mitigated, but others can’t, leaving many wondering if they can hang on long enough. Business loans for restaurants can help cover some of those costs and be invested in improving current profitability. For example, a POS system can improve your restaurant’s profitability. If yours is outdated and isn’t set up to handle contactless payment, an upgrade may be in order. A loan could potentially be used to cover that cost.
In 2011, 10% of America’s workforce could be found working in the retail industry. That number only grew, at least until the pandemic hit. Like restaurants, retail businesses have ongoing expenses they have to pay, regardless of whether or not they have customers coming in. Employees have found themselves working fewer hours, furloughed, or without a job altogether as retail companies have worked to find a way to stay in business in an economy that rapidly declined. Measures were put in place, such as the Paycheck Protection Program, to incentivize businesses to keep employees on their payroll, but with funding limited for individual businesses, this only ended up being a stop-gap measure for many. Once funding ran out, layoffs and furloughs were to be expected. Further funding could help struggling retail businesses afford to continue to pay employees instead of creating a bigger unemployment problem.
Despite the ability to work at an appropriate distance from others and to work outside, the construction industry has also suffered thanks to the pandemic. Businesses are unlikely to expand right now, decreasing the demand for commercial construction services. In many states, nonessential construction was halted. Like the agricultural industry, the supply chain experienced significant disruption. A lot of important construction materials are made in China, and with the complications brought on by the pandemic in conjunction with the ongoing trade war with China, construction companies have been feeling the pinch. Many of the construction industry’s 11.2 million employees have found themselves in similar situations to retail workers as companies struggle to respond to a changing economy and see the recession through to the other side.
Some of the harder hit industries can really benefit from small business loans right now. Industries such as the energy, agriculture, transportation, restaurant, retail, hospitality and leisure, automotive, and construction industries have been struggling to overcome the challenges brought on by the pandemic. Small business loans have the potential to go a long way towards bridging the financial gap left by consumers who have limited their spending in order to make their own funds go further. These industries have important roles to play in our economy. Helping protect them with small business loans is a step towards ensuring that they are still there for us when we get to the other side of the pandemic.
Could you use a small business loan to get your business back rolling again? Apply for one from us today!