What Hair Salons Are Going Through

Comments

1

There are a lot of people in the same boat, and for a lot of them it makes sense to talk to a bankruptcy attorney. That costs money, or course, but it is cheaper than paying rent. It also makes sense to talk to your landlord. Many, if not most landlords would prefer getting, say, 10% of the usual rent, rather than nothing (the result of bankruptcy). A hair salon is tough, because they obviously have invested money in the equipment, which would probably be lost if the business becomes insolvent. The same is true for restaurants, while bars often have nothing much besides beer handles.

It isn't clear at all what the new "stimulus package" does for people in that situation. It was a clear need (I'm not an economist, but I wrote about this exact situation a couple weeks ago). As to whether they actually provided anything or not is a different issue.

2

Hang tight, talk to your landlord, it's not like he can replace you with a new business.

Then wait for "COVID hair". It will be a thing in 2-3 months. Expect a rush of customers.

3

All small businesses should reach out to the SBA and seek disaster assistance.

https://www.business.wa.gov/site/Resources-for-WA-State-Businesses---Workers-Impacted-by-COVID-19/alias__business/1561/Resources-for-WA-State-Businesses---Workers-Impacted-by-COVID-19.aspx

We are all in uncharted territory. It will not be feasible for every landlord to evict every tenant and for every property owner to be foreclosed on. The entire country is going to be financially decimated. There is going to have to be a huge amount of forgiveness and forging forward. We already, as a society, ignore the hundreds of thousands of homeless in this country. What are we going to do, make tens of millions or more homeless? Put everyone out of where they currently live and have businesses and let the homeless population skyrocket and let buildings be empty and rot?

99% of the people in this country are worse off than the other 1%. Trump and the GOP and the wealthy in this country have made it clear they want people to die so they can keep their wealth. Do they really think that is how this will play out? They underestimate how people are going to behave when it gets really bad, because they are used to the compliance of the poor and the working class in this country. They are used to taking and taking and taking and taking with little or no push back and getting away with it.

I, and this is just my personal opinion, believe that if tens of thousands or hundreds of thousands or god forbid even millions or tens of millions of people's lives and livelihoods are destroyed by what is happening now (and let's be clear, that is what we are looking at, from renters to property owners to businesses to towns and cities ~ from the smallest to the largest), to this country as a whole being decimated in ways most people living here can't even begin to fathom, there will be action taken against the billionaire class that sat around and did nothing while it happened.

People are already fighting over toilet paper and Trump spews hatred at all who don't stroke his ego and feed his delusions. What do you think it is going to be like in 6 months? And we're not even remotely looking at any kind of vaccine for this virus for 18-24 months. The government is taking their $500 BILLION now and will continue to take whatever they can get, but they are delusional if they believe everything will just go on as usual, with them doing what they want and the people taking it. Scared people, dying people, starving people, people with literally nothing left to lose do not remain compliant.

There will be a reckoning.

4

I’m not trying to minimize the difficulty but tenants are not going to be easily replaced… Most landlords are not big businesses and they are probably going to get some kind of forbearance from the lender if they have a mortgage....

Key thing to do is TALK TO THE LANDLORD IMMEDIATELY, if not sooner.

5

I emailed my salon weeks ago to find out how I could financially support my regular stylist. I figured a $100 "tip" given to the stylist along with the payment for the appt. that got cancelled due to Covid-19 would be real useful to the stylist and the salon owner. The owner of the salon never emailed me back. So I gave that money to the Union Gospel Mission instead. Just because your business is closed doesn't mean you should ignore your inbox. Good luck to those impacted by this sucky situation.

BTW, an observation about how this is all playing out: there are now two layers of society. The "haves" work from home on their computers, shop online, and expect low-paid unskilled workers to do the dirty work. The "have nots" get to spend their days in crowded warehouses next to people who receive low wages and no sick pay. There is something very wrong with this picture. I NEVER use Amazon - I have no desire to have blood on my hands. Good luck out there, people. The "gig economy" is being shown for what it is - the latest scam perpetrated on the dumb peasants by the crafty ruling class rich.

6

@2 -- Expecting salons to be open in three months seems optimistic. I would expect salons to be closed for at least six months. The numbers are still going up locally, while they are accelerating at a faster pace just about everywhere else in the country. It is possible that we could get the numbers down to a manageable level in a few months, but you would still need to have massive amounts of testing to warrant opening up something like a hair salon. This country is way behind in terms of testing and I don't expect the problem to be fixed in three months.

We should be testing every employee and patient in every hospital, nursing home, jail and prison. We should be testing everyone who works outside their home as well as anyone who wants it. This should all be done daily, so we can track and treat the problem. If that were to occur, then we could operate in a somewhat normal way (like South Korea) as opposed to simply having things keep getting worse, and then shutting everything down for a long time (like so many other countries did).

Anyway, that is another reason why it makes sense to talk to the landlord. It is possible the landlord is more optimistic than me. They may agree to a waiving the rent until the business can reopen, figuring that it will only be a couple months.

7

@2, @6 -- She did talk to the landlord. It's in the second half of the piece.

8

@7 -- Yeah, sorry, I meant someone in a similar position.

This is a great article, that mentions many of the big problems that small businesses have to deal with. B and O tax, licensing fees, credit card fees -- it all adds up.

In her particular case (and people in a similar position) I would consider the possibility of bankruptcy. I don't think they could take her home, assuming she didn't put it up for collateral (and operates an LLC). But again, that is where a lawyer would come in handy.

9

I am so overdue for a cut and color.

Best of luck to you Jodi.

10

My partner is a commercial landlord in Pierce county. He and his business partner are already planning on forgiving rents for the next few months. Turnover is expensive. Even if you were to kick out your tenants - you'll have no income until you get new ones. The huge difference between residential and commercial property is that once a commercial tenant leaves, the next tenant has to build out the space for their needs. It isn't like residential where you take over an empty space that has been cleaned up and is a blank slate. So you have empty space with no tenant, you get a new one - then THEY have to go through the build out process before they open. Now - you have the availability of contractors and materials to deal with. God forbid a heat pump goes out in winter or AC in summer - good luck finding someone to fix it! True story - the heat pump went out in November one year. MAJOR hassle getting anyone with any open slots to fix it. Weeks with no heat.

Sucking up the loss of rental income is the smartest move for landlords. Once this is over - everything is in place to start up again.

11

@5 - you are correct

12

What I find fascinating is to date, I have seen nothing mentioned about Property Tax payments.

I can only conclude that the counties will remain untouched, and will expect their payment as normal.

13

@12 Death and taxes.

14

@12 I didn’t pay property tax from 2007-2009. Nothing happens. They send you a letter every month until you pay.

16

@14 That's a very risky thing to do. Because they can put your property on auction for non-payment of property taxes. It'd be better to call them and ask what you can do, instead of just not paying. I believe that there are some programs people can apply for to defer the taxes, but I don't know what the eligibility criteria are. Maybe the governor will enact something to at least delay the payment date. But definitely call them, don't just not pay!

17

I wonder if a state income tax would change any of the business fees?

18

Those taxes may drop some but will never go away. The State, County and Cities can't even let a tax that was promised to sunset go away.

19

Even with an income tax what these people would pay would be the same if not more. The Government powers that be only want tax revenue to go one way, up.

20

@17 -- The B and O tax is essentially a regressive form of income tax. Yes, it is most likely that a real income tax would lower it.

@18 -- You don't know what you are talking about. Check the facts. The last two initiatives for an income tax would have lowered other taxes. It is right there in the description. https://www.sos.wa.gov/elections/research/income-tax-ballot-measures.aspx

1982 Initiative 435 Shall corporate franchise taxes, measured by net income, replace sales taxes on food and state corporate business and occupation taxes?

2010 Initiative 1098 Initiative Measure No. 1098 concerns establishing a state income tax and reducing other taxes. This measure would tax 'adjusted gross income' above $200,000 (individuals) and $400,000 (joint-filers), reduce state property tax levies, reduce certain business and occupation taxes, and direct any increased revenues to education and health.

The only reason we have a regressive tax structure is because of pinheads like you.

21

No income tax. No compromise.

23

@22 Look at your pay stub and then you will know.

24

Didnt the stimulus package include $600 per week on top of regular state unemployment benfits to each unemployed person? I believe that provision is funded for four months. If I am right, the people in this article should each receive just under $1000 per week in unemployment for up to 39 weeks. They will also get their $1400 one time payment (as per stmulus package for each adult) and $500 one time payment for each child. So, the couple who are both unemployed should receive combined $7000-8000 monthly in unemployment benefits plus those one time payments. Obviously this would take time to obtain, and it may not completely replace their income, but it might be enough to allow them to meet all their financial obligations.

26

@25 We're talking about a state income tax here. And, the federal government will do as it always does when it cannot raise enough tax money...it will inflate the currency.

28

@27 Sure, but enact a state income tax and see a lot of investment and economic opportunity melt away to Texas, Nevada and other no-income-tax states. Money seeks a combination of the highest returns and lowest taxation. Look at New York and Illinois...their populations are shrinking as their tax burdens become ever higher due to too-generous government pensions.

Enact a state income tax in Washington and watch it become a voracious consumer of the people's weal. Watch the jobs decamp for Texas and Nevada.

No state income tax. No compromise.

30

5
and yet Seattle's prosperity is built on the backs of the new slavery.
Seattle talks a good 'progressive' talk but is really just the 21st century flavor of Robber Barons and Ante-Bellum plantation owners.

31

@28 -- Such bullshit. California is still growing. New York is shrinking largely because northern New York (Buffalo) is shrinking, and overly restrictive zoning prevents the creation of new housing in New York City (where lots of people want to live). DC has one of the highest income tax rates, and it is growing faster than any state. Utah is the fastest growing state, and it has a 5% income tax, which is relatively high.

Nor has income taxes hurt business. The top three states in GDP per capita are Massachusetts, New York and Connecticut (all high income tax states). D. C. has higher per capita GDP.

We have the most regressive tax system in the country, and some selfish assholes love it that way. Tax the poor, feed the rich while making up bullshit arguments for why it should be that way.