Lynnwood CPA: ‘Head-scratcher moments’ for businesses struggling to get loans

Small businesses around the state and across the country are trying to apply for Paycheck Protection Program (PPP) loans to help them survive the closures and stay afloat through the pandemic.

Nathan Gibson is a certified public accountant and co-owns a salon in Lynnwood with his wife. He previously joined the Gee and Ursula Show and said he was planning to apply for a loan. Last weekend, Gibson finally received funds after applying on the day they opened applications for round one.

“It’s been a process,” he said. “We were hopeful that they were gonna get it locked in for us. I have a good relationship with our banker and it’s at one of the smaller regional banks.”

For those who are not CPAs or may not have a relationship with their bank, Gibson recognizes that the loan process may take even longer and has seen the difficulty firsthand through helping his clients with their applications.

“At my firm, I have been put in charge of getting all the applications for all of our clients done,” Gibson said. “So I’ve seen the process for many, many, many banks and each of them, even though we’re doing the same loan, each of them will ask for something a little bit different.”

“I have had some definite head-scratcher moments where I’m looking at this going, ‘I don’t understand where they got this from,’ and it definitely adds to the delay in the whole process,” he added.

His advice to small business owners is to consider going to a smaller bank and working to form that relationship. Many of these smaller banks are still accepting new clients.

“It’s like a mad dash right now just to try to find bankers who are willing to process your loans,” he said. “Talk to somebody who has been successful at a small bank and see who their contact is and reach out and give them a call, or shoot them an email and see if they’re still taking more people.”

This is not to say, Gibson clarified, that people at bigger banks are not working as fast and as hard as they can to get these loans out to people and small businesses.

“The smaller guys just have the ability to be more nimble,” he said.

Small businesses are also getting pushback from employees for taking PPP loans since some people are making more money on unemployment than they would if they were back on payroll. Gibson admits that’s a difficult conversation to have, and one they had to have with their own employees at the salon.

“We’ve been put in the situation where you have to make hard decisions,” he said. “The PPP program itself is supposed to be there to help keep businesses afloat and give them money to be able to cover rent. If everybody was on unemployment, then we wouldn’t have the ability to … take portions of that PPP loan and pay for rent, so there wouldn’t be a company to come back to.”

His advice to clients has been to talk to employees about the viability of the company and what’s at stake. Gibson also recommends being flexible and moving things around to accommodate employee concerns.

“You can try to tweak around your hours so that other people are working the hours that another employee was working so that they can stay on unemployment and the other employee could maybe take advantage of the PPP,” Gibson said.

“It’s a little bit harder for companies like our salon, where we’re still shut down,” he added.

Barbershops and salons among struggling businesses during shutdown

For now, Gibson hopes the government can provide more guidance on what things might look like when salons and other businesses are able to open so they can start to better prepare.

“We can start collecting the gear that we need to have, so that we know how many people, like if we need to start spacing out the salon so that there’s certain distance requirements, if there’s gonna be a max capacity, then maybe in order to change, we’ll have to open up our hours,” Gibson said.

“There’s a lot of ideas that we have, but until we know the rules, it’s hard to come up with something solid,” he continued.

Gibson also acknowledged part of the return will be difficult to plan, not knowing if employees and customers will be safe enough to return.

“We need more answers than we do questions and so hopefully those answers will start to come,” Gibson said. “But we have to just kind of keep working at it together.”

Listen to the Gee and Ursula Show weekday mornings from 9 a.m. – 12 p.m. on KIRO Radio, 97.3 FM. Subscribe to the podcast here.