Small business guide: weathering economic storms

In 2021, professional services firms helped small businesses recover from the COVID-19 pandemic by working with the US Small Business Administration to provide or help access the Paycheck Protection Program and emergency loans. of economic disaster.

As things return to normal, fear has been replaced by uncertainty as New Jersey small businesses grapple with inflation, interest rate hikes, recession fears and labor shortages -work.

Here’s a look at what a leading law firm, accounting firm and financial institution are doing to help small businesses meet these new challenges.

“The immediate financial pressure businesses faced when the pandemic hit and the resulting economic shutdown have passed,” says John Cromie, corporate and business law group leader at Connell Foley in Roseland. “Our customers have figured out what to do with their businesses in the wake of the COVID shutdowns, and the supply chain issues seem to be easing,”

Cromie says companies have adapted and are finding new ways of doing business. However, “inflation has created a whole new set of issues for our customers to deal with,” he said.

For example, on the construction side, Cromie notes that construction companies bid their jobs with prices that did not reflect the potential for significant escalations and delays in purchasing materials for the job. As a result, construction companies are now facing these issues and need help.

“On the real estate side, we see companies that are in [industrial] spaces, whose leases or sub-leases are about to expire, are struggling to find space because there is so much demand for flexible industrial space here in the northern New Jersey market, in the central part of state and along the 95″ corridor,” says Cromie.

“We help them solve these problems,” he explains.

On the M&A side, industry watchers are seeing significant activity in several sectors.

“Typically, we will represent companies that are on the sell side,” says Cromie. “A lot of companies say they’ve been through COVID, but they don’t have a succession plan in place. There’s a great opportunity there for companies to sell, often to a private equity firm.”

Jordan Amin, tax partner and co-head of Iselin-based EisnerAmper’s private client services group, points out that the economy is entering a period of high interest rates and high inflation.

“At the same time, we are still grappling with the issues that have persisted for a year and a half, including labor shortages and supply chain disruptions,” he says.

“We work with our clients and try to help them manage; not just short-term and day-to-day, but how to think about the next 18 months to three years. We help them put their businesses in a position where they can be nimble and able to pivot as needed,” says Amin.

“As we begin to see government stimulus measures dry up, it is important that we understand our customers and how their businesses are operating, how they have handled the pandemic and how they are emerging from the pandemic,” says Joseph Lomoriello, vice -senior president. President, Regional Director, Commercial Lending, at Provident Bank.

Lomoriello adds that as stimulus funds dry up, borrowers are turning to traditional sources of financing for their working capital through their existing bank lines of credit.

“We have a lot of clients on annual working capital lines to renew,” continues Lomoriello. “We’re looking at their numbers to make sure we understand how they’ve weathered the pandemic and how those numbers compare to historical levels, looking at performance from 2018 and 2019.”

Lomoriello explains that Provident understood that 2020 was going to be a bit of a disaster. With the easing of restrictions in 2021, the financial institution has started to see a significant rebound, though not necessarily back to full operations.

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