Return of foot traffic in malls key to survival for some SMEs

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Metro Manila (CNN Philippines, July 24) — The COVID-19 pandemic has pulverized profits of small businesses, including this decades-old family venture which has long relied on in-store sales.

The House of Polvoron, best known for its large-scale production of the iconic powdery treat, revealed its struggle for survival since coronavirus crisis crashed into the local scene.

"Prior to the lockdown, business was very stable and very good," owner Charlotte Caliwara-Tanoja shares with CNN Philippines' The Exchange.

When the lockdowns were imposed in March, Tanoja said their brand lost 70 percent of their revenues. This forced them to pull out three of their nine mall kiosks, with more stalls likely to fold if foot traffic in malls does not improve in the coming months. Mall goers either have little money to spare at this time, or are afraid to contract the virus when out in public.

For now, company employees work just three days a week and are told to find part-time jobs as they could not be paid in full, she added, with the fear that more closures may be on the table.

It's been a struggle to keep their workers as Tanoja said HOP did not receive help from various government agencies offering financial assistance or wage subsidies.

Taking the business online helped, which now accounts for 80 percent of sales. However, it was still not enough to match last year's figures, Tanoja admitted.

House ways and means committee chairman and Albay Rep. Joey Salceda said the stimulus package being prepared by Congress could be of help, as it would boost financial support and loans to keep small businesses afloat. However, the wait will take longer as the measure still needs to be approved by the Senate and reconciled with the House version before it can be signed into law.

Micro, small, and medium enterprises account for two-thirds of local employment and comprise 99 percent of all businesses in the country, but are more vulnerable to financial shocks due to their size.