What to know about PPP

The past year has been one of the most challenging years in history for small businesses.

The coronavirus pandemic has stretched and broken many small businesses in the Dayton area. The next three months will be the toughest for many businesses as the first quarter is normally a slow time for them.

Small business owners will have to be resilient, pivot, and adapt their business models to navigate the continually changing conditions.

According to the U.S. Small Business Administration, here are some of the trends small businesses will see in 2021:

E-commerce will grow: While e-commerce was already growing before the pandemic, a report by IBM shows the shift away from physical stores to digital shopping has sped up by roughly five years. According to the report, e-commerce is projected to grow by 20% in total in 2020.

Alternative payment options tor increase:

The dominance of alternative payment options will grow. In their annual State of Retail Payments study, the National Retail Federation found that no-touch payments (e.g. contactless credit and debit cards or mobile pay) for retailers have increased 69% since January. Among retailers that have implemented contactless payments, 94% expect the increase to continue over the next 18 months.

Remote work will persist: During the pandemic, many small businesses shifted to part-time or full-time remote work schedules in response to local ordinances. According to a survey by Intermedia, 57% of small to medium-sized business owners said they will continue to offer remote work options in the long term.

High demand for virtual services: According to the U.S. Chamber of Commerce, the pandemic has led to increased demand for certain business types, particularly those related to technology and virtual health and fitness. These include cybersecurity, at-home fitness, food delivery, gaming, home improvement, and telemedicine businesses.

Second round of PPP launched

The U.S. Small Business Administration and the Treasury Department last week launched a second round of the Paycheck Protection Program. The relaunch prioritizes small businesses, authorizing $284.5 billion to be distributed through March 31, or until the funds are depleted.

Here’s what the SBA says small businesses need to know:

■ Only businesses with 300 or fewer employees and those that can show at least a 25% reduction in gross revenues from comparable quarters in 2020 and 2019 are eligible.

■ The maximum loan size is 2.5 times the average monthly

payroll costs for non-food service businesses, up to $2 million. If this is your first time receiving PPP, the maximum pay-out is $10 million.

■ Small businesses in the Accommodation and Food Services industry can receive Second Draw loans up to 3.5 times their average monthly payroll costs.

Borrowers will receive full loan forgiveness if they spend at least 60% of their PPP Second Draw loan on payroll costs over 8 to 24 weeks.

Rich Gillette is the Dayton Daily News business editor. He can be reached at rich. gillette@coxinc.com or on Twitter @richgillette.