Businesses stung by another lockdown

Small business owners in Melbourne’s north-west have spoken of their heartache of enduring yet another lockdown, with many struggling to stay afloat and finding ways to pay staff.

North West City News spoke to several businesses who said the state’s fourth lockdown had taken its toll with cash flow drying up and government payments doing little to help.

Michael Cardamone, who has been running his family-owned Italian restaurant in West Melbourne for 39 years, said the latest lockdown had hurt with revenue all but dissipating.

“There’s not much money in takeaway … by the time you pay wages, honestly, it’s just a joke,” he said, adding “there’s no profit left” after paying high commission fees to food delivery services such as Uber Eats.

“There’s no reward. You’re basically working for nothing,” he said.

“With JobKeeper (last year) at least you could have staff working doing takeaway, you could subsidise your wages and operate.”

He said his business would normally turnover between $25,000 and $30,000 a week but that had “totally dissipated”.

Mr Cardomone said he had applied for grants, but applications were either too complex to fill in or “you’ve got to jump hoops”.

It’s just frustrating, unfortunately. We’ve got so many functions booked in the two or three weeks.

“I’ve got one this Sunday for a wedding which they’re waiting for me to say ‘yay’ or ‘nay’. I said, ‘look you’ve got to wait for this government.’”

“At the end of the day the small guy always cops the worst. If you’re a big fish you can play football, you can play sport … but what is a little restaurant in the suburbs got a hope of having a voice?”

Judy Collings, who has been running Wayward Books in Kensington for 15 years, said she was trying to stay optimistic in the face of uncertainty.

While she understood safety was a priority, she was sad to close the doors of her pride and joy business during the latest lockdown.

“It’s a conflicted position because you want people to be safe, you want this thing to be over as soon as possible, but at the same time you want your business to survive,” she said.

She is now doing her best to survive via her online presence, but estimated sales had dropped by up to 80 per cent. 

Ms Collings said it was tougher this time around without the JobKeeper payment scheme which helped her keep afloat during last year’s extended lockdown.

But she has applied for a state government business support grant of $5000, which she conceded would make a “big difference” if approved.

“It’s very hard. I’m luckier than a lot of people because I’m later in life, and I’ve got a little bit behind me but there’s a lot of businesses that don’t have that,” she said.

Ele Prioce, owner of Sassy Italian Restaurant in West Melbourne, said he had been left devastated, describing the lockdown as a nightmare.  

He was concerned about his staff and questioned the lack of government support.

“What are they giving us? $2500? What’s that? That doesn’t even pay your electricity bill,” he said.

“How are we supposed to support our staff when I’ve already gone to the bank twice before to reborrow to give these guys money so they can pay rent and bills?”

Mr Prioce, who opened his restaurant in August 2019, was forced to lay off staff within months of opening due to the crippling impacts of last year’s lockdown.

“Now this time around, once again, we’ve gone back to full rent and we’re getting nothing for it.”

He said he was incurring losses of more than 80 per cent each week with food delivery services also taking a large chunk of what was left.

“We’re not even making anything. We’re in a no-win situation here.”

Mel Massimi, who runs Moscato Hair in West Melbourne, was staying resilient despite revenue quickly evaporating.

While she welcomed government support which would be “enough to pay my rent so I can open the doors”, she said “other than that there’s nothing else”.

But she was grateful for her loyal customers who “keep calling and buying products online; everyone is trying to support local”.

“I feel more sorry for the hospitality industry than anyone else,” she said, adding she counted herself lucky that she operated with just her business partner and didn’t have staff to pay.

In Kensington, hair salon owner Natalie Ragusa, who opened her Aerial Studio business in March last year, said business had also plunged. 

“As our job requires face-to-face service with our clients our business has been greatly effected through each lockdown,” she said, adding as a new small business they were not eligible for any financial help during their first year.

“Small businesses must not be forgotten about; this is our livelihood. We all have to stay positive so that we can all see this through.”

“We are grateful that we have the support of our clients to keep going.”

The president of the North and West Melbourne Precinct Association Marita Smith said many businesses had been left “shattered” as they weathered the uncertainty of lockdowns.

“The government grants on offer are most welcome and will definitely take the edge off for some businesses, but we know that it's not going to be enough to cover the rent for many,” she said.

“We know many businesses, particularly catering and cafes, will be hurting during this current lockdown, but we are a strong and close-knit community who will get through this together.”
“Over the next few months, we'll be launching some visible campaigns to encourage North and West Melbourne residents to look more locally for shops and services within walking distance instead of traveling further afar.

“We hope this will result in community connections and provide some real optimism for local traders.”

Ms Smith, who runs a contemporary art gallery business in North Melbourne called Gallery Smith, said she changed her business model “quite dramatically” to an online platform after being forced to close her doors.

“Obviously we want people to be coming in and experiencing art, that’s what art is about,” she said.

“Fortunately, we’ve got a very loyal customer base and they have been very supportive.”

The state government announced more than $500 million in cash support for businesses with payments up to $7000.

The federal government will also provide disaster payments of $500 to help Victorians who would normally work 20 hours per week.

While Victorian Chamber of Commerce and Industry Chief Executive Paul Guerra welcomed the federal government initiative, he feared it wouldn’t keep workers connected to their job and see businesses rehiring. 

Restaurant and Catering Industry Australia CEO Wes Lambert said the lockdown had been a “crushing blow” to the thousands of restaurants, cafes, and caterers, adding grants of “just a few thousand dollars just won’t cut it this time, not with federal JobKeeper gone and tenant protections having just expired”.