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COVID-19 Resources for Canadian Independent Retailers

March 31, 2020 | Published by Faire

Photo courtesy of Boldfaced Goods.

We’ve built Faire on the belief that the future is local, and we’re proud to see communities rallying across the U.S. and Canada to support local during this COVID-19 crisis. Canada is home to one of Faire’s company headquarters and has been an integral part of our journey as a company. We aim to support our Canadian customers through the uncertainty of the coronavirus disruption.

To understand how to best support our customers through this time, we checked in with how our makers and retailers were responding to the crisis. We surveyed 20,000 businesses across the U.S. and Canada and learned that makers are concerned for their retailers, and rightfully so: 70% of independent retailers report they do not have enough cash on hand to handle this type of crisis.

We published Immediate Steps for Local Retailers in Response to COVID-19 to support the retailers who are facing difficult times. We also recently launched a new financial planner tool to help customers understand action they can take given the impact of COVID-19, and we’ve extended net terms and free return windows by 30 days, to take some more risk out of wholesale buying during this time.

While the timeline and economic impact of this disruption both remain uncertain, our top priority is to do whatever we can to support your business and your customers. As part of that, our experts compiled this resource of initiatives led by the Government of Canada to help support your business through this time.

Credit relief to cover business operating expenses

The Government of Canada has established relief programs to help small business owners get access to credit, in order to cover operating expenses during the time your business has felt the slowdown from COVID-19. Most of the federal programs are in the process of being finalized, and so we’ve linked sources that will update with clear next steps to take as they become available.

  • The Government of Canada has created the Business Credit Availability Program (BCAP) to provide Can$65 billion of additional support through the Business Development Bank of Canada (BDC) and Export Development Canada (EDC). These programs will roll out in the three weeks after March 27, 2020. If you’re interested in these programs, we recommend reaching out to your current financial institutions.
    • Canada Emergency Business Account – This new program will provide interest-free loans of up to Can$40,000 to small businesses. The loans will help cover operating costs during the period when revenues have been temporarily reduced from COVID-19, so small businesses can pay for rent and other important costs over the next number of months.
    • Loan Guarantee for Small and Medium-Sized Enterprises – EDC will provide guarantees to financial institutions so that they can issue new operating credit and cash flow term loans of up to Can$6.25 million to small and medium-sized businesses. These loans will be 80% guaranteed by Export Development Canada, to be repaid within one year.
    • Co-Lending Program for Small and Medium-Sized Enterprises – BDC is working with financial institutions to co-lend term loans to small and medium-sized businesses for their business expenses like payroll and rent. Eligible businesses may obtain incremental credit amounts of up to Can$6.25 million through the program, which will be risk-shared at 80% between the Business Development Bank of Canada and the financial institution they’ve partnered with to guarantee the loan.
  • Many provincial governments have set up emergency loan programs and tax deferrals. Check out relevant programs by province on the Canada Federation of Independent Business’s (CFIB) website.

Email covid-relief@faire.com if you know other available loan programs available to Canadian businesses, and we’ll review them and share updates frequently.

Support for your staff

Protect yourself, your staff, and your customers above all else. Actively encourage sick employees to stay home, practice social distancing, and follow the latest updates on the CDC’s website. If you or your employees need to stay home, to reduce hours, or general support to cover business expenses there are programs that have been established or expanded listed below.

  • Small Business Wage Subsidies – The federal government will provide a 75% wage subsidy to small businesses for salaries paid since March 15 that experienced a 30% reduction of their revenue due to the COVID-19, for up to 3 months. This will help businesses to keep and return workers to the payroll. More details on eligibility criteria will start with the impact of COVID-19 on sales and will be shared on March 31.
  • Work-Sharing ProgramThis program is designed to provide Employment Insurance benefits to workers who agree to reduce their normal working hours to help avoid layoffs when there is a temporary reduction in the normal level of business activity that is beyond the control of the employer, including COVID-19. Eligible to businesses operating in Canada year-round for at least two years, this program has now extended the maximum duration from 38 weeks up to 76 weeks.
  • Emergency Response Benefit – All Canadians who have ceased working due to COVID-19, whether they are Employment Insurance-eligible or not, will be able to receive the Canada Emergency Response Benefit of Can$2,000 a month for up to four months. Canadians will begin to receive their CERB payments within 10 days of application starting in April 2020. The CERB will be paid every four weeks and be available until October 3, 2020.

Other support for financial stability

On top of direct credit relief and benefit programs, the Government has taken steps to ease monetary policy, support additional lending in the economy, and provide liquidity assistance to Canadian businesses through deferred payment dates for tax filings, remittances, and customs duties.

  • The Bank of Canada has lowered interest rates to support economic activity and keep inflation low and stable. They’ve expanded a buyback program for government bonds, expanded purchases of mortgage bonds, and created two programs both aimed at supporting lenders to facilitate loans to small businesses.
  • The Office of the Superintendent of Financial Institutions announced it’s injecting Can$300 billion of additional lending capacity into the economy through eased capital requirements for Canada’s large banks by lowering the Domestic Stability Buffer to help ensure financial stability during the coronavirus pandemic.
  • Income tax filing deadlines for individuals and corporations have been extended: the due date for filing is now June 1, 2020. Taxpayers will have until September 1, 2020 to pay any 2019 income tax amounts owed for individual filings and the current year’s taxes if corporate. If you’re self-employed or have a spouse or a common-law partner who is self-employed, the deadline to file your taxes is still June 15, 2020.
  • Goods and Services Tax/Harmonized Sales Tax (GST/HST) remittances and customs duty payments are being deferred to June 30, 2020, which could provide up to Can$30 billion in cash flow or liquidity assistance for Canadian businesses over the next three months.

Focus on your business’s health

In Immediate Steps for Local Retailers During COVID-19, we’ve outlined eight essential focus areas for retail businesses and actionable steps in each focus area:

  1. Prioritizing health
  2. Reducing your costs
  3. Doing the right thing for your people & your business
  4. Seeking financial relief & credit options
  5. Increasing your revenue
  6. Staying informed on economic developments
  7. Connecting with your customers & community
  8. Bookmarking essential resources

We’re here for you

We’re committed to giving you the information you need to make important decisions about your business, and will provide more updates and trusted information as it becomes available. Our team is inspired every day by the resiliency of small businesses and independent entrepreneurs, and we’re looking forward to a day when this unprecedented moment in time is behind us.

Please stay safe, stay connected, and join the conversation in our retailer community forum.

New to Faire? Click here to learn more.

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