The big source of coronavirus-related government help for businesses with 500 or fewer employees is a $350 billion loan program. But somehow big restaurant and hotel chains got themselves included in the program, leaving small businesses worried they’ll be edged out.
Franchise owners will also be eligible for the small business loan program, no matter how big the company they’re franchisees of—and no matter how many franchises they own. For instance, the owner of 68 Massage Envy franchises, who employs 2,000 people, can apply for loans just like the owner of two breakfast spots in Chicago. “This stuff is meant for me, the little person,” says the breakfast restaurant owner. “We’re a collection of small businesses,” says the guy who owns 68 of the same massage business.
”The restaurant industry is uniquely affected by this pandemic,” a National Restaurant Association executive said. “It was the first industry shut down. We think we deserve a unique response from the federal government.” That may be the case—but this is about putting big chains over small businesses. If an industry lobby group thinks its industry deserves a unique response, it should make that case directly rather than getting its multinational giants put in under the program intended for small companies. And the fact that those big chains could get assistance at the expense of small businesses shows that the National Restaurant Association’s concern is for some parts of the restaurant industry over others. Unfortunately, it succeeded at getting that written into the law.
McDonald’s and Chipotle say they won’t apply for the loans—for now, at least.