There are concerns that the government’s Payment Protection Program (PPP) — a part of the $2 trillion COVID-19 economic relief package — may be excluding small businesses.
Black Enterprise reports that major food chains — such as Shake Shack, Potbelly Sandwich Shop, and Fiesta Restaurant Group Inc.’s Taco Cabana — all received $10 million in Payment Protection loans.
However, many small business owners have been denied PPP funding. Business owners like April Richardson are upset and feel defeated by the allocation of the funds.
“It’s a reminder to small businesses that our voices are dampened, what are we doing this for? Why are we in business just to be told we’re not good enough because we’re not big enough,” Richardson told CNN.
Black Enterprise also reports that other major chains like Kura Sushi USA Inc. — the largest sushi chain in the U.S. — received about $6 million in loans; Ruth’s Chris steakhouse operators received $20 million; J. Alexander’s restaurant chains were funded $15.1 million, and energy company Hallador Energy received $10 million.
Some big chain executives like Potbelly’s Chief People Officer Matt Revord are planning to use the PPP funding to support their employees, while others have decided to return their funds to the government.
“Like many other restaurants, Potbelly applied for the PPP, every penny will be used to financially support the employees in our shops. Congress specifically qualified restaurants for the PPP loan program because restaurant workers are vital to our economy,” Revord told CNN.
Unlike Potbelly, Shake Shack has decided to return their funds and announced the return via a LinkedIn post:
“Shake Shack was fortunate last Friday to be able to access the additional capital we needed to ensure our long term stability through an equity transaction in the public markets. We’re thankful for that and we’ve decided to immediately return the entire $10 million PPP loan we received last week to the SBA so that those restaurants who need it most can get it now.”
According to Black Enterprise, the government is in the process of adding an extra $310 billion to the PPP, with $60 billion going to rural and underserved groups.