Businesses get flexible to survive pandemic shutdown

If anybody understands the economic impact of the COVID-19 crisis, it’s Christi Callahan.

Instead of reporting for work at The Salvation Army Family Store & Donation Center on John Hawkins Parkway on March 23, the Hoover resident was told to go to the human resources office in Birmingham, where she was let go with no promise of return.

She had been employed full-time with The Salvation Army for four years, but now she and about 14 others in the Hoover and Homewood stores have lost their jobs, she said. This followed a March 20 order by the Jefferson County health officer to close all non-essential businesses to slow the spread of the COVID-19 disease.

Callahan joined more than 80,000 Alabamians who filed new unemployment claims that week, compared to about 1,800 new claims just two weeks before, according to data from the Alabama Department of Labor. The following week, more than 100,000 additional new unemployment claims were filed in the state.

“It’s really a bummer the way it all worked out,” Callahan said.

The COVID-19 pandemic has wreaked havoc on just about all sectors of the economy, from retail stores to restaurants, hotels, entertainment venues, health care, manufacturing and service industries.

“I keep hearing the word unprecedented,” said April Stone, executive director of the Hoover Area Chamber of Commerce. “None of us have ever been in a situation like this before.”

Probably the hardest hit industry in Hoover has been retail because the economy in Hoover is so retail-oriented, Stone said.

While businesses that sell food and other “essential” items have been allowed to stay open, most others had to close. The Riverchase Galleria, the state’s largest enclosed shopping center, closed all its interior space.

BIG AND SMALL SUFFERING ALIKE

The shutdown has affected big businesses, such as Macy’s, and small ones, such as the Keagan Ross Furniture store off U.S. 280, a family business run by Daniel and Tami Manofsky.

The Manofskys, who live in Greystone Ridge, have been making and selling custom furniture for businesses and individuals since 2014 and were “rockin’ and rollin’” with strong business this year when the virus threat hit and they had to close their doors.

They have orders to fill but aren’t allowed to work and thus have no income.

“It’s so bad,” Tami Manofsky said. “We put all of our money into this company, and then we had to stop. ... We have to pay our bills. We have a house. We have a car payment.”

They had been saving money and planned to move closer to Berry Middle School in May, but now they’re having to use the money they had saved for a down payment just to survive, she said.

They were denied both unemployment and a relief small-business loan but were invited to reapply for the loan after criteria loosened and for a pandemic unemployment program.

The Manofskys recently had dropped off food for the Hoover Helps organization through the Neighborhood Bridges group, but now Hoover Helps is bringing food to them.

“It’s just amazing,” she said. “We’re just hanging in there. There’s nothing really you can do.”

Robyn Gayheart, owner of the Hammer & Stain DIY Workshop in River Oaks Village, said she had to tell her four instructors she couldn’t pay them right now because they can’t hold workshops anymore.

She’s selling do-it-yourself kits online, arranging for curbside pickup and was working to develop online classes.

She thinks she can make it through this crisis because she had some money saved up for a rainy day, and she was hoping to get one of the new federal grants that are part of the COVID-19 relief package approved by Congress.

RESTAURANTS AND HOTELS

Bob Baumhower, owner of nine Baumhower’s Victory Grille restaurants (including locations in Hoover and Vestavia Hills), said the shutdown of dining rooms is a whole lot scarier for restaurants than most people realize.

Like many restaurants, his company was hit hard and scrambled to beef up its online ordering and curbside pickup service, offering a “Pick Me Up Menu” with individual and family meals and a new “Just Wing It” wings-only drive-through tent outside all its restaurants.

Then on April 13, his restaurants started selling groceries to try to bring in more revenue and meet demand, including bread, milk, cheese, hamburgers, ground meat, chicken breast, chicken wings, chicken tenders, beer, wine and toilet paper.

Will Kadish, the developer of the new Stadium Trace Village, said restaurant shutdown orders have put a halt on most deals for construction of new restaurants across the country.

Walk-on’s Bistreaux and Bar was slated to close on a location in Stadium Trace Village in mid-April. Franchise owner Matt Roth said they still definitely plan to build there; there will just be a delay.

The hotel industry also has been hit hard,as travel limitations and meeting cancellations dried up bookings.

Most hotels in Hoover are running about 5 to 7% percent occupancy, while they’re normally about 80% full this time of year with numerous spring events occurring, said Tynette Lynch, the city of Hoover’s director of hospitality and tourism.

“They’ve cut staff to the bare minimum,” Lynch said. “Our industry is really, really suffering. ... It’s pretty drab.”

Paul Dangel, director of sales and marketing at the Hyatt Regency Birmingham – The Wynfrey Hotel and president of the Hoover Area Chamber of Commerce, said his hotel already has lost more than $2 million worth of business due to COVID-19, including $300,000 worth of business alone due to the cancellation of the SEC Baseball Tournament.

The silver lining is that the business slow-down has allowed the Hyatt Regency to speedup a renovation project to 30 rooms per week, he said. They also are able to get new escalators installed without disturbing anybody, he said. The renovation project should be complete June 1.

SERVICE PROFESSIONS

Personal service professions such as hair and nail salons were deemed non-essential and forced to close.

Fatima Mitchell Bardo, a Hoover resident who owns Fatima’s Family afHair salon in Helena, said she had already begun extra sanitizing and limiting the number of people in the salon when the state ordered all hair salons to close. She and the four women who rent booths from her are out of a job, and she has bills to pay.

“I don’t know what we’re going to do,” she said. “If I don’t cut hair, I don’t make money.”

Plus, hairdressers serve a broader purpose, Bardo said. They’re trained to sort of serve as personal counselors, listening to people’s problems, she said. “Everybody just thinks we cut hair. We do so much more.”

While many health care workers are working overtime to serve COVID-19 patients, others have been sidelined because the state postponed non-emergency procedures.

Stephanie Schambeau, a Ross Bridge resident who manages business operations for her husband’s dental practice, said it’s not fair that they must close while car dealerships and liquor stores are open. The number of people getting sick with COVID-19 doesn’t justify shutting down the whole economy, she said.

They’ve applied for a $10,000 grant offered through the federal relief package, but “that’s not going to cover your overhead,” she said. “We’re just like ducks in water.”

Entertainment venues also are feeling the heat. Lenders for AMC Entertainment Holdings, the nation’s largest movie theater company (which has three movie theaters in Hoover), have hired lawyers who specialize in restructuring after the chain closed all its theaters nationwide March 17 and furloughed all 26,000 employees, according to The Wall Street Journal.

People in professional services such as law, accounting, insurance and real estate were allowed to stay open, but they’re feeling the effects, too.

Some people who want to sell their homes are reluctant to open up their houses for people to visit, and some buyers are reluctant to go, said Tracy Dismukes, a Hoover resident who works for ARC Realty.

Real estate agents are setting up more virtual tours, and when they do take potential buyers into homes, many sellers are turning on all lights and opening all doors to limit hand touches, Dismukes said. “People are being very, very careful and considerate,” she said.

Closings also are being done virtually now, she said. ARC Realty had 64 new contracts in the last week of March, Dismukes said.

Her primary business, Collage Designer Consignment in Vestavia Hills, was having its best year in 28 years when she closed the doors due to COVID-19, she said. None of her 10 employees are getting paid, but she hopes to bring them all back when this is over, she said.

The COVID-19 crisis hit at a rough time for her family. Her husband has no income right now due to extended hospital stays related to heart surgery and brain aneurysms, but “we have faith in God,” Dismukes said.

She believes God led her into the real estate business last summer to give her another income stream during this time, she said.

BRIGHT SPOTS

There are some bright spots in the economy. While restaurants are having a tough time, grocery stores have experienced a surge in demand as people are eating more at home.

“It’s been crazy,” said Naseem Ajlouny, a Hoover resident who owns 13 Piggly Wiggly stores, including the one in Bluff Park. “People— they went wild. They started hoarding this stuff. This is worse than the snowstorms, worse than holidays. ... It was like doing business on steroids. ... I’ve never seen anything like this before.”

But the surge in demand, coupled with the dangers of COVID-19, have added some challenges, Ajlouny said.

He’s had to take extra measures to protect both employees and customers from the new coronavirus, with extra cleaning and plexiglass to separate cashiers from customers.

Supply chains around the world are over-burdened, meaning shortages on certain goods, such as milk, toilet paper and sanitizing agents, Ajlouny said. He’s having to rely on alternate suppliers, such as companies that normally supply restaurants, he said.

His people are doing their best to restock the shelves as soon as they can with what they can find, he said. “You may not get the brand you want,” but they’re trying to find the products people need, he said.

He’s having to pay a lot of overtime because there is so much work to do, and employees are tired, he said. Some customers complain about the lack of certain items, but most have been understanding and thankful the stores are open and employees are there, he said. He doesn’t think the supply situation will get better until restaurants reopen and take some of the pressure off groceries, he said.

Other “essential” retailers with locations in and around Hoover are hiring thousands of workers in stores and distribution centers to meet strong demand, including Walmart, Publix, CVS, Walgreen’s, Lowe’s, Home Depot and Dollar General. Delivery companies such as Amazon, Shipt and Instacart also have been hiring more people.

Many of those companies are offering workers bonuses right now due to increased workloads.

‘RISING TO THE CHALLENGE’

There also has been more business for technology companies as workers telecommute and students learn from home.

The Hoover-based ProctorU online test proctoring company has had about five to 10 times as many inquiries as usual from potential customers, said Stephanie Dille, the company’s chief marketing officer. Near the end of March, ProctorU was seeing as many as 200 inquiries a day, though the number more recently decreased to 75 to 100 inquiries a day, Dille said.

Some of the increased business has come from existing universities already using ProctorU’s services but adding more departments, programs or classrooms, while other inquiries have come from new institutions or professional organizations who need the ability to conduct exams remotely during this crisis, she said.

Most notably, in late March, ProctorU began delivering graduate school entrance exams and English-as-a-foreign-language exams around the globe for the Educational Testing Service, the world’s largest private, nonprofit educational testing group.

Jarrod Morgan, ProctorU’s founder and chief strategy officer, said it has all been happening quickly and forcing the company to add staff.

“We’ve been hiring like crazy,” Morgan said. “We’re staffing up all over the world.”

That includes test proctors, support staff and people to handle all the inquiries, he said.

ProctorU has grown to about 250 full-time employees and substantially increased its total proctoring operations from 600 to nearly 1,000 people over 13 locations in six countries, Dille said.

Morgan said the COVID-19 crisis has forced some institutions that were skeptical about online tests to make the jump and given ProctorU a chance to prove itself. “I think we’re making believers out of people,” he said.

But many businesses are fearful this crisis could cripple them for a long time or put them out of business altogether.

Stone said she looks out her window at the Hoover chamber office above the empty Riverchase Galleria food court and is reminded everyday what businesses are facing.

“I think about all the people who just want to work hard, and they’re not able to right now,” she said.

But she has been impressed with the ingenuity and entrepreneurial spirit she is seeing shine through in Hoover’s small business owners, she said.

“They’re rising to the challenge,” Stone said. “This is a dream of theirs, whatever they can do to keep the work going.”