Coronavirus takes toll on San Jose small businesses

When Sean Yang was in college, he bussed tables at the San Jose sushi bar Kazoo. Now, some 28 years later, he owns the place. But since the coronavirus pandemic began, what he suspects is fear of the virus has caused a significant dip in business. He wonders how long his restaurant can tough it out.

“For every business owner, this is a challenge,” he said. “It is like climbing a mountain. You wonder if you are going to make it. Am I going to get to the top or drop?”

The impact of coronavirus on businesses can be seen by visiting stores such as Costco, Target or Safeway and trying to find hand sanitizer, disinfectant wipes or other necessities.

But the local food-service industry — especially restaurants like Yang’s that serve Asian cuisine — has been hit particularly hard.

Initially, Yang said, business was only down about 5 percent, but starting about two weeks ago the drop off spiked to 20 percent to 25 percent.

“At the beginning, the general public, most of the media, thought it was a faraway thing. It is happening in Asia, we’re like ‘OK, well, no big deal,’” he said. “People have fear of the unknown, especially when a number of politicians gave us a wrong message in the beginning.”

Yang has made several adjustments at the restaurant, located at 250 Jackson St. in Japantown, including giving employees more sick days, prohibiting them from traveling out of state and disinfecting tables and chairs more frequently. Perhaps the most difficult decision, he said, was whether to cut back on how much food he orders. Because Yang runs a sushi bar, freshness is paramount. Ordering less food could mean not having enough to serve if business picks up, but ordering the same amount could mean a lot of food waste.

He said he also worries that if things get bad enough, the restaurant could have an issue with getting shipments at all.

That concern is real, said Jesus Flores, president of the Latino Business Foundation Silicon Valley. Flores said not being able to get products to sell because of delays in shipping is a “huge, huge problem” for businesses.

Flores wrote a letter to the San Jose City Council urging officials to take measures to support local small businesses. Those measures include establishing a stabilization fund for small businesses whose sales have been affected by coronavirus and a moratorium on small-business evictions.

Very few programs are in place to assist small businesses in such a crisis, he said. Such measures are necessary to keep small businesses afloat, Flores added.

“If, because of coronavirus, a Panda Express needed to close … they could just relocate and accommodate,” Flores said. “If that were to happen to a local business, they would just close forever. … If we don’t support those small businesses, it is the local economy that is being affected.”

Officials at The SVO, Silicon Valley’s largest chamber of commerce, said they’re hearing from small business members about devastating business and financial impacts from the canceled conventions, conferences, business meetings, sporting events and working remotely.

Matt Mahood, the organization’s president and CEO, said he’s working with his policy team to come up with economic development strategies to help support small businesses. “We will then work with our partners at the local, regional, state and federal level to advocate for immediate implementation in order to protect small businesses, nonprofits and their employees,” he said.

The San Jose City Council has directed city officials to draft a moratorium that would prevent landlords from evicting tenants who can prove the outbreak has caused significant financial hardship. The moratorium, which Flores would like to include his provisions for small businesses, will likely be finalized in the next couple of weeks.

On Friday, a trio of San Jose lawmakers called for a citywide paid sick leave policy amid the coronavirus pandemic. They said many low-wage employees are forced to choose between reporting to work while sick — potentially exposing others to the highly-contagious disease — or putting food on the table.

But Mahood said the policy, which will be discussed by councilmembers next week, would hurt small businesses by leading to increased costs and lost jobs.

San Jose Councilmember Johnny Khamis first noticed the virus’ impact on small businesses when he went out for lunch at one of his favorite restaurants. The government must do a better job informing the public of the risk, he said.

“People are scared because they don’t trust what they hear from the government. It is almost like a rumor mill out there,” he said. “You can’t stop living your life. Of course we want people to be cautious. Maybe we should just stop shaking hands.”

Whether the City Council will implement Flores’ recommendations remains to be seen, and whether any measures taken by local government will be able to help businesses in time remains uncertain.

But Yang is remaining hopeful. He has seen scares from SARS, mad cow disease, bird flu and swine flu all come and go.

“Every time you have a disaster like this you have to get back to basics: Provide quality food,” Yang said. “I am still optimistic … sooner or later, this will go away.”

Contact David Alexander at [email protected].