Business

Covid and racism are devastating to many Asian-owned small companies

Leo Lee and his wife Lydia relied on take-out and delivery services to keep their Los Angeles restaurant RiceBox afloat during the pandemic.

Source: Leo Lee

Like many small business owners across the country, Leo and Lydia Lee saw revenue from their Los Angeles restaurant nosedive when the Covid pandemic broke out.

They also endured anti-Asian incidents.

The Chinese-American couple has been running their Cantonese grill restaurant RiceBox in downtown LA since September 2018. The majority of his customers were from companies in the area thanks to catering contracts and the crowd at lunch.

When companies closed their doors, the two decided to stay open. They survived by continuing to offer take-away and add-on delivery services. Nevertheless, the business fell by around 70%.

Then the calls came.

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“We got a lot of prank calls,” said Leo Lee. “People would ask, ‘Do you serve bats? Do you serve covid?”

Another time, a customer pushed past the blocked front door where orders were being taken instead of the facility, coughed at Lees, and headed back.

“We were scared,” said Leo Lee.

The pandemic has dealt a double blow to Asia-American / Pacific Islander (AAPI) small business owners.

Just over 80% of small business owners said they were having a negative impact from the pandemic, and 44% have reduced their workforce. This is according to a survey conducted by the Asian / Pacific Islander American Chamber of Commerce and Entrepreneurship from September 28 to November 30, 2020. Almost every third AAPI entrepreneur has experienced anti-AAPI sentiment due to the pandemic, according to the survey.

“The rise in anti-Asian racism and violence has continued to harm small business owners during this global pandemic,” said Chiling Tong, President and CEO of National ACE.

“We have a vaccine against Covid, but we don’t have a vaccine against hate.”

Hate crimes against Asians in the US rose 169% from Q1 2020 to Q1 2021, the Center for Hate and Extremism Research at California State University in San Bernardino found. From March 19 to March 31, 6,603 incidents were reported at Stop AAPI Hate, including verbal harassment (65%), avoidance (18.1%), and physical assault (12.6%).

This is what many Asian Americans feared: a recent poll by Pew found that a third feared someone might threaten or physically attack them.

Joanne Kwong, president of the family-run Pearl River Mart in New York, sees this fear in her employees every day. Known as the first Sino-American department store when it opened 50 years ago, the store is now split into three smaller locations. They closed completely for a few months last March before two gradually reopened. In October, the company added a new store, Pearl River Mart Foods.

Joanne Kwong, President of Pearl River Mart, stands in front of the company’s newest location in Soho, New York City.

Pearl River Mart

Since reopening, Kwong has had to adjust her employees’ shifts to make them feel safe when commuting to and from work. It has also changed the opening hours and closed earlier before it gets dark.

“We’ve all had incidents where people might have said something [racist] on the street, “said Kwong, the daughter of Chinese immigrants from the Philippines.

“We have employees who have actually been pushed or spat at.”

In addition to the psychological stress, the pandemic also has economic effects. Business initially fell about 90% and is now hovering around 40% of the time before the pandemic, she said.

Kwong received a Federal Paycheck Protection Program loan in the first round of the program. Thanks to an administrative error at her first bank, she has yet to be approved for the second round of the PPP, which runs out of money for most borrowers. Fortunately, Kwong has also sought help from a community financial institution that is still open to filing new applications with the Small Business Administration.

“We’re on needles,” she said. “When will that end?”

Kwong said she is also fortunate that her English skills are excellent unlike many AAPI business owners.

In addition to a language barrier making the application process difficult, there are also cultural issues, especially when two-thirds of the community are born outside of the United States, said Bill Imada, founder and chairman of IW Group, the minority advertising and marketing agency. When the pandemic hit, Imada helped AAPI business owners navigate the resources available.

“Many of these immigrants have never asked the government for support,” said the Japanese-American Imada. “In some cases they are from countries where they are concerned about the government, they don’t trust the banks.”

We have employees who have actually been pushed or spat at.

Joanne Kwong

President of Pearl River Mart

Half of the AAPI entrepreneurs applied for PPP last year, and of these, 80% received a loan, according to the small business majority.

Now that smaller banks are involved in PPP, he has seen more AAPI companies get credit. In addition, restaurant owners can apply for assistance through the Restaurant Revitalization Fund, and venues can apply for a grant for gated venue operators. For those who qualify, catastrophe loans for economic injury continue to be available.

The private sector also makes its contribution. For example, GrubHub announced that it will donate all of its proceeds from its Donate the Change program to AAPI-owned restaurants in May, the month of AAPI Heritage. Yelp, which saw searches for Asian-owned businesses up more than 3,000% year over year in February, has made it easier to find and support these businesses.

It is this outpouring of support and unity within the AAPI community that has been the silver lining, Kwong said.

“The community has been very inspiring and more cohesive in ways I’ve never seen before,” she said.

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