The way Justin Ladha sees it, there’s good news and bad news in the latest lockdown for the St. John’s metro area’s business community.
“First of all, a lot of businesses, particularly small businesses, which comprise the majority of our membership, are in a worse financial position going into this second wave (of COVID-19) than they were going into the first wave,” said Ladha, the new board chair of the St. John’s Board of Trade.
“However, this is not March of 2020. We know a lot more about COVID-19. We do know there’s a light at the end of the tunnel, although we don’t know exactly when, but we do know it’s coming.”
There are vaccines, but there’s also knowledge. “Our businesses know what to do. There’s existing supports in place, but they were amazing at quickly developing online platforms, curbside pickup, advertising online and developing all the safety protocols to have their employees work under those circumstances to keep them safe. That’s all done, so they can react much quicker.”
That’s why Ladha, CEO of real estate and property management company KMK Capital Inc., feels it’s reasonable to think businesses can make it through this rough period.
Timing matters
Restaurants missed out with the move to Alert Level 5 just before Valentine’s Day but having a lockdown in mid-winter isn’t all bad.
“You never want to have to shut your business, but if you do have to shut your business, you want it to be at the slowest time of the year,” he said. “For the retail trade, you don’t want to have that in the latter part of November or December, and for the restaurant trade, you don’t want to have it over Christmas and you don’t want to have it over the summer. Now I know Valentine’s Day was a big hit for some of the restaurants, so that’s really unfortunate. But overall, the winter would be slower for restaurants and in a lot of cases retail.”
The fact this lockdown involves a new, more easily spread variant of the virus will force business to reassess how they serve customers and clients, ensuring their health and safety measures also protect employees, Ladha said.
“They do need to be extra cautious in putting in additional measures to the extent that it’s recommended,” he said. “That needs to be taken very seriously, because the stricter we are with this and we adhere to all the public guidelines, the quicker we’ll get out of it.”
Spending stimulus
Getting back to a point where the public can once again safely go about their daily business also ties in with efforts to boost Newfoundland and Labrador’s economic picture, which was murky even before the pandemic. While he acknowledges many people in the province and across the country have lost employment since last March, others who were able to work managed to save money because there were fewer opportunities to spend. Coming out of this lockdown, he anticipates more spending.
“Savings as a whole are accumulating, and you combine that with the record lower interest rates and when restrictions eventually do relax, there’s stimulus there in the form of getting people to spend — houses are more affordable, lines of credit are more affordable — to go out and purchase other items,” Ladha said. “I think for businesses, you will see some additional spending when we come out of this and when people are allowed to move.”
Provincially, Ladha sees strong willingness among the political parties to address economic reform and recovery, but also the province’s fiscal situation.
“The quicker we take action to correct the path we’re on, the better we’ll be. It doesn’t have to be fixed right away, and we don’t need mass layoffs or anything like that. But we do need to be put on a path where we’re not spending way more than we’re taking in. Once we’re on that path, that will create more confidence, and people looking from the outside in to invest in here ... and come here will see that, and they’ll have even more confidence.”
Immediate action
In the here and now, the St. John’s Board of Trade recently launched a program to help businesses with advertising. Staff have also been working with members facing challenges related to the lockdown and offering help where they can. That often entails connecting businesses with the right resources. New virtual information sessions with business experts are also being planned.
“We looked at this and said, ‘We need to take immediate action.’ That’s how we thought we could best help businesses that need help today. They don’t have time for us to take a month and figure this out. They need help, and they need it now. We know that, so we’re acting now.”
Andrew Robinson is a business reporter in St. John's.
