We are living in uncertain times. The outbreak of COVID-19, better known as coronavirus, has brought normal life to a halt around the world. Each day, new guidelines are being put forth by state and federal governments in order to help stunt the growth of this highly contagious virus.
As of this writing, several states have ordered the closing of all restaurants and bars for dine-in service until further notice. As a small business owner, that’s a scary thing to hear. Not only are your customers affected by these decisions, but your employees and their families as well. We are here to help answer some of the questions you may have around closing your business and what steps may help you through this time.
What is COVID-19?
COVID-19 is the latest coronavirus that’s currently spreading across the globe. Coronaviruses are a large family of viruses that commonly circulate among humans, causing mild illnesses such as the common cold. COVID-19 is the latest strain that’s having a wide-ranging and serious impact, readily spreading from person-to-person contact. Therefore, self-quarantine is currently the best preventative measure.
The risk assessment is currently changing daily. Though many can catch this virus, there are some at a higher risk of more serious complications, including older adults and those who have serious chronic medical conditions like heart and lung disease, and diabetes. Though you may not fall under this high-risk population, COVID-19 is easy to catch and transmit to those who are. Therefore, precautionary measures are being mandated by many local and state governments, as well as recommended courses of action stemming from the federal level. These include limits to dining out, traveling, and attending large group gatherings.
Per the Centers for Disease Control and Prevention (CDC), current symptoms of COVID-19 include mild to severe respiratory illness with fever, cough, and difficulty breathing. If you are experiencing symptoms such as fever, cough, and difficulty breathing, or have been in close contact with a person confirmed to have COVID-19, or who has recently traveled from an area with an ongoing spread, the CDC recommends you stay home and contact your healthcare provider.
In addition to quarantining, frequent and thorough handwashing is highly recommended to kill bacteria and slow the spread. You can view CDC-recommended handwashing practices in our Crash Course on Food Safety.
Where Can I Find More Information About the Small Business Administration (SBA) Disaster Assistance Loans for Impacted Businesses?
The Small Business Administration has an ongoing list of disaster-relief programs to assist in times like these. State and federal government and health officials are working together to ensure the safety, security, and health of its citizens and small businesses are encouraged to do what they can to keep their employees, customers, and themselves healthy.
SBA is doing its part to assist small businesses in accessing federal resources to navigate this turbulence, including guidance for businesses and employers and access to capital. View SBA resources here.
Filing Bankruptcy for Small Business
If your debts incurred through this crisis are too much to withstand, bankruptcy is an option that can help provide some relief. Depending on your situation, you can file for business bankruptcy under Chapter 7, 11, or 13. Which chapter you file under depends on many factors, such as:
- Are you personally responsible for business debts?
- Whether your business is a sole proprietorship, partnership, or corporation
- If you want to close your business or keep it running
The legal advice site NOLO has developed a comprehensive guide to small business bankruptcy. It discusses the pros and cons of each type of bankruptcy, as well as resources that can help you decide further.
We also recommend you speak with an attorney specializing in bankruptcy. They will know the ins and outs of your situation and can lead you to the right steps that will benefit you the most.
Closing for Good and Selling Your Business
Unfortunately, not every restaurant will survive this event, as much as we hate to think about it. If you decide the best course of action is to close your business for good, one of the questions you’ll likely have is deciding what to do with your equipment.
Luckily, there are several options for selling used equipment. The most direct way is by selling through an online marketplace such as Facebook Marketplace, Amazon, or eBay. This will be a good option if you have the time and storage space, as the fees from selling though these channels are lower than going through a liquidator or reseller.
If storage and time are not on your side, you can find a reseller or liquidator. Their goal is to buy out your equipment at a lower price and sell at a profit. You will want to be ready to negotiate, as their initial offer will likely be a low one.
The other option is to go through an auction house. An auction house will list your products on their site and take a portion of the final selling price as a fee.
Cody Bell is a content specialist with Central Restaurant Products. With over 7 years of experience in the foodservice industry, Cody has developed knowledge on topics from all aspects of commercial foodservice, from the front of the house to back of the house. He is a NAFEM Certified Foodservice Professional. In his free time, Cody likes to spend time with his wife and puppy.