Local businesses hurt, seek equal opportunities to earn a living

While the lockdown is relatively minor compared to what business owners witnessed in March 2020, a sense of panic is hard to escape.

On a warm evening in March, staff members worked swiftly inside a glitzy salon in Malad, Mumbai, to sanitize their customers’ hands and feet as they noted down their details and studied the number of appointments pending for the evening. 

Most masks stayed on as a customer waited for her hair color to set in just as another client soaked in the afterglow of her manicure.

The Glam Factor salon, a family-run establishment in the western suburbs of the city, was slowly getting back on track this year after the pandemic stalled their profits in 2020 after India went into a complete lockdown last March. This was a huge setback for Farha Siddiqui and her family as they fretted over their salon’s future. The Siddiquis had decided to invest in the salon in October 2019, just months before the pandemic took over the world.

Siddiqui spoke about the challenges that confronted the family as soon as they decided to open for business after the lockdown months. “People were scared of getting into a salon,” Siddiqui explained. “This is very natural – nobody wants to get affected [by COVID].” Her team zeroed down on precautionary measures such as regularly sanitizing all equipment, implementing temperature checks, and restricting the number of customers and staff members inside the premises to cope with the situation. Profits slowly started picking up as customers started trickling back into the shop over the next few months. 

Read more: COVID19 broke the backs of Mumbai’s informal sector workers. What does 2021 hold in store?

Deja Vu

To the Siddiquis’ dismay, this was short-lived and a second wave of the pandemic prompted the Maharashtra government to call for a partial lockdown and a night curfew on April 3. 

In a few days’ time, local authorities decided to ramp up the restrictions as the number of cases continued to rise in Maharashtra. According to an Indian Express report, public movement has been restricted in the state and only essential services such as medical operations, grocery stores, food services, vegetable stalls, fruit-sellers, and dairy shops, are allowed to remain open. Meanwhile, restaurants have been permitted to offer home delivery services while e-commerce services are now limited to essential goods. All other services such as gymnasiums and salons have been instructed to stay closed until the end of the month.

Vidhya Soundararajan, a professor at the Indian Institute of Management, Bangalore said that the lockdown is likely to scare migrant laborers the most. Soundararajan is a microeconomist who specializes in labor markets and is certain that the latest developments can hurt Mumbai’s migrant laborers which in turn can leave business owners feeling helpless. “I’ve spoken to some firm owners [in Mumbai] recently,” she explained. “They’re saying that some of [their] workers are going back [to their hometowns] before they even know what is happening.” The fear in the air is palpable. Soundararajan said that while the lockdown is relatively minor compared to what business owners witnessed in March 2020, a sense of panic is hard to escape. A probable solution, according to the professor, is for business owners to provide a ‘safety net’ to their workers in a bid to ease their worries.

Shivdi 2020. (Pic: M. Gopal)

The restrictions left Nilesh Shah, a small business owner from the city, utterly distraught. He had lots of questions on his mind: Would his staff members leave the laundry shop and head back to their villages in fear? How would he continue to provide for them and keep profits running? How long will this ordeal last? Shah said that it was discouraging for him to discover that the restaurant industry remained partially opened while his laundry shop was out of bounds. “I [didn’t] have enough work to call all staff members,” Shah said, pointing out that he was already running at 50 percent capacity before the second lockdown. As per his estimate, his business suffered a massive loss last year and Shah lost as much as 78 lakhs in seven months. As a result of the economic slowdown, the entrepreneur decided to shut down one of his shops in the city. A few customers did approach Shah for laundry services after the lockdown was lifted but things remained slow at the shop for months. 

After the announcement of the latest lockdown restrictions, Shah can’t help but feel disheartened. “Many [migrant] workers will go back to their hometowns if things don’t open up soon,” he emphasized. “Some [of my] staff members have loans,” he added, explaining that they’re under pressure to provide for their families and stay afloat.

Venting out on social media

Even as the Maharashtra government announced its restrictions on April 5 , many small business owners and major players in the industry took to social media and lashed out at the government for its decision to impose restrictions. Saransh Goila, a chef and the owner of the popular chicken delivery service, Goila Butter Chicken expressed his concerns on Instagram. He lamented about the lack of support from the government in terms of providing relief and offering measures such as ‘relaxation on licenses, rent, salaries, taxes, [and] bills.’ Goila mentioned that his peers from the industry in other parts of the world have received aid from their local governments. He wrote, “Why don’t we get or deserve the same? Sad and exhausted and as a young entrepreneur fully demotivated to run a business in India.” 

A few days later, some respite did make its way to Goila and others like him in the food and beverage industry. According to the Economic Times, The Brihanmumbai Municipal Corporation announced on April 7 that restaurants and other businesses delivering essential goods would be permitted to offer their delivery services 24/7 on all days of the week in Mumbai. However, non-essential services such as laundry shops and salons weren’t included in the statement.  

While Siddiqui understands the need to observe a partial lockdown to curb the spread of the virus, she wishes that things were slightly different for business owners like her. She explains that it’s possible to offer services by observing full precautionary measures, limiting the number of clients to one or two at a time coupled with organizing regular RT-PCR tests and vaccinations for all the employees. “We are very cautious when a client comes to us. We’re responsible for them,” she stated. Shah feels similarly. He said that even when stores were allowed to run, he only worked with one client at a time and ensured that everyone wore masks and used hand sanitizers at the shop. Additionally, an irate Shah pointed out that he could still see lots of people milling about in public on a hot Tuesday afternoon. He said, “From where I stand, I can see so many people [in front of me]. What is the point of a lockdown? Only we are suffering.”

Loans for small businesses

In 2020, after observing the devastating impact on small businesses and enterprises, the Indian government decided to extend the MSME (Micro, Small, and Medium Enterprises loans) scheme that allowed small business owners to apply for loans. As per a Bloomberg Quint report, the Emergency Credit Line Guarantee Scheme was meant to complement the Atmanirbhar package that focused on helping small and medium business owners during the pandemic. However, those looking for financial aid needed to find a way to cross several hurdles along the way. 

As per Soundararajan, only business owners who had previously registered with the board could get access to the scheme. Plus, there was another caveat. Soundararajan explained that those who had applied for a loan in the past could apply to the scheme. This was confirmed by a CNBC report last year that highlighted the fact that only ‘existing customers on the books of the Money Lending Institutions (MLIs)’ could obtain access.

Siddiqui isn’t aware of the loan scheme. And for Shah, getting into debt is an option he’d rather not consider in these uncertain times. However, the pressure is immense. For example, his team members have been getting restless about the lack of increments over the past year. He is also dealing with an ethical dilemma: some of his staff members have been with him for several years and asking them to quit their jobs is something he can’t live with. “Long-term relationships are starting to suffer,” Shah reflected. “And there’s no price attached to them. These things are priceless.”

A plausible solution, as per Soundararajan, is to provide equal opportunities to all players and offer online marketplaces as a viable option for business owners to sell their products and services online. “Who has really survived the pandemic? People who work from home because technology enables them,” the professor explained. “Sometimes, the government has to think about giving everyone an equal space.”

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  1. Neha Gupta says:

    Very well explained Boshika. Hope this helps in any small way possible

  2. Shefalee says:

    True ” government has to think about giving an equal space to everyone”.

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