After Ida, small businesses face uncertainty
A week or more after Ida, business owners from Louisiana to Connecticut are still adding up the financial losses and assessing the physical and emotional toll, grappling to find a way forward.
Many say it’s difficult to figure out the future when they’re unsure of the answers to some immediate questions: When will the power come back on? How long before I get new supplies? When can my business be rebuilt?
“There’s no more anxious situation to a business owner than a complete lack of clarity in how to plan,” said Pike Howard, director of finance and development for New Orleans-based Felipe’s Mexican Taqueria restaurants. Many businesses have already dealt with a long stretch of uncertainty due to the coronavirus pandemic.
“The amount that we’ve been tested the past 18 to 24 months it’s hard to imagine the roller coaster,” Howard said. “If you didn’t have a cash reserve going into this situation, I don’t know what you would do.”
Some help is being made available. On Monday, President Joe Biden approved major disaster declarations for six New Jersey counties and five New York counties. That follows similar announcements for Mississippi and Louisiana, the initial targets of the hurricane.
Disaster declarations are
year ago. In Connecticut, it has showrooms in downtown Greenwich, downtown Westport, downtown West Hartford and at Danbury Fair mall.
Also in the past quarter, the company saw a 36 percent decrease in internet sales. The decline was “reflective of channel shift back to showrooms that are now fully open,” Nelson said. Digital platforms remain, however, a major source of income — with the company’s initiatives including a temporary ‘pop-up shop’ on costco.com.
The rebound of Lovesac underscores the furniture industry’s growth during the pandemic, as the sector has benefited from the spike in demand generated by the residential real estate market boom in much of the country and the significantly greater amounts of time that millions of Americans have spent at home in the past year and a half.
But the pandemic has also disrupted supply chains. Lovesac officials said their firm has made a number of adjustments to mitigate rising freight costs that have resulted from factors including container shortages.
“We have deliberately and strategically built a geographically diverse supply chain with manufacturing in Malaysia, Vietnam, along with China and Indonesia, as well as the U.S., to create redundancies that we view as critical to ensure short lead times and strong in-stock” positions, Nelson said.
Most of Lovesac’s sales come from its signature line of couches, which are known as Sactionals. The seating arrangements can be reconfigured, the covers are washable and the covers and seat filling are changeable.
Another major seller are Sacs, which are beanbag seats filled with Durafoam and the source of the company’s name.
The company held its initial public offering in 2018, 20 years after its founding by Nelson.
“We’re attracting a lot of new customers across the board, but that core young parent ‘want-it-all’ is critical to our business,” President and Chief Operating Officer Jack Krause said on the call. “We’re doing very well with that group. Our awareness is growing dramatically. The young parent want-italls are part of the older Millennials who are engaging in either looking to buy a home or expanding their family.”
Executives said they have seen robust demand in the current quarter.
“We had a very strong Labor Day weekend — actually stronger than what we had projected internally to happen,” Executive Vice President and Chief Financial Officer Donna Dellomo said on the call. “We had a strong promotion that we ran, I think, for four days over Labor Day weekend. It was very well received, and that could be because we’ve pulled back on discounting over the last handful of months.”