Businesses pick up the pieces after another lockdown

By Brendan Rees

Businesses in the CBD have been dealt a devastating blow after the city was plunged into yet another lockdown. CBD News spoke to a number of eateries, cafes, and restaurants, as well as hair and beauty salons who have been left counting their losses after the state’s COVID-19 restrictions again turned the once-bustling streets of the city into a ghost town. 

Johnny Vakalis, who runs The Journal Café on Flinders Lane, said he was left picking up the pieces after revenue plunged. 

“It’s hard when you’re a small business and you’re trying to fight for one dollar and we’re in an area where it’s very competitive,” he told CBD News, after only a handful of customers had visited his café that day. 

“It was a little bit tougher to be honest because we were sort of building up and then almost stopped the momentum.”

He said his son, who helped run the business, had encouraged him to stay open despite the pair “working for nothing”. 

“We’ve got good solid regulars who support us to a great degree, and they love going in there for their daily chat and all that sort of thing. They keep me going, to be honest.” 

Mr Vakalis said he applied for government support but believed it “doesn’t cover anything”, adding “when you lose the 20 to 30 grand a week, how’s that going to make an inroad? And you’re still owed people.”

While he was glad to reopen for dining after restrictions were lifted, he said he felt like he was starting from scratch after the Queen’s Birthday long weekend proved to be disappointing. 

“There’s no football, and you’ve still got the 25km limitation, so how many people can come into the city when there’s nothing there anyway? It’s very hard, very hard,” he said.

“What do you do? Keep at it I suppose; hopefully things turn around.”

Bill Morton, the owner of The Paperback Bookshop for the past 20 years, said the latest lockdown had had a “huge impact” after he was forced to go digital.

“We were still able to operate in terms of our online presence, but it probably reduces it to about 20 to 25 per cent of the normal business that we would do,” he said.

“This latest lockdown – even though it’s relatively short – will have put a real dent in our momentum.” 

“We chose to keep all our staff on. Again, we’re going to get through it and continue on.”

While he understood safety was a priority and acknowledged the state government had “done a pretty good job in keeping us safe”, he said the “trade-off with that, is that it does affect people’s lives and affects small business like ourselves.”

“A major difference from the long lockdown is that some of the really crucial support mechanisms for business weren’t there, in particular JobKeeper … that’s what we’re going need to continue to get through,” he said.

“If this happens again that’s going to be an ongoing major concern because you know that support for staff probably won’t be there.”

Mr Morton said it had been a relief to reopen his popular shop which had been a boost to staff morale and their loyal customer base, whom he described as “really fantastic”.

Also grieving the effects of the latest lockdown was John Gleeson who has run a dry-cleaning shop Your Personal Dry Cleaner in Collins St for nearly 30 years.

“We stayed open; our worst day was $10.70. Our best day was about $200,” he said.  

“We need to average about $1300 a day – that was pre-COVID. We haven’t got back to that yet. It was pretty tough.”

“This lockdown was more severe than last year. I think people thought ‘it’s only short, we’ve got to do it,’ so everyone stayed home and stayed indoors.”

Mr Gleeson said he would normally launder and iron between 80 to 90 business shirts a day but had been lucky to do 15 or 16. Before the pandemic hit, he would have 120 a day.

He said his business had slashed its hours from 10am to 2pm during the lockdown but “there’s no one around … people have just hibernated”. 

“Our stockpile of clothing has actually gone up because people aren’t coming to pick it up and they’re not using it. Our racks our totally full and we’ve brought in an extra rack,” he said.

“People who are dropping them off don’t have an urgency to pick them up.”

To survive, Mr Gleeson said his staff had resorted sowing facemasks to sell because “it’s either that or nothing”. 

Meanwhile, Mr Gleeson said he had applied for a government grant, which, despite being just a few thousand dollars, he acknowledged it would at least help pay his staff. 

“You’ve just got to hang in there and know it’s going to get better later, because if you cave into all the negativities around then you will go under.”

Also left reeling was Georgia Mackie, whose Seedling Café at the corner of Little Collins St and Equitable Place, took a hit at a time when trade had just begun “gaining momentum”. 

“We’ve definitely lost more this time. It’s all well and good to be open for takeaway, but there’s no people here,” she said. 

 “You don’t just want to drop all your staff either. You want to help people out. They’re all students not earning huge wages. They don’t have massive savings that they can go and live off for a few weeks.”

“We stayed open, but it was really just to cover paying some staff to have some shifts.”

In terms of government support, Ms Mackie said, “I guess we’ve always felt a little hard done by the grants because we own two shops in the CBD and we only ever get one grant.”

“It’s definitely been more challenging this time around without JobKeeper.”

Looking ahead, she said she expected to see “a little bit of momentum” but not a “drastic change until the restrictions change”.

At the Queen Victoria Market, Linda Li, who runs a gift and souvenir stall called Woodcrafts Australia with her husband, said the lockdown had been heart-wrenching.

 She said trade had still remained “very quiet” despite being able to reopen after restrictions were eased.  

“There are no international tourists and customers from interstate. It’s very difficult for us,” she said. 

“We have some products for locals like chopping boards, but we need more customers from overseas.”

Michael Mawas had also been left shattered after being ordered to shut his pride-and-joy barber shop during the lockdown.

He said he was anxious about how his business, Blackstone Barber on William St, would stay afloat if further lockdowns were imposed. 

“That’s a big thing in my mind: how I can keep my four boys on the floor?” he said of his staff.

“I’m more stressed every day I think about it. I hope things get better … a lot of people work from home and we rely on them.”

While he was grateful business had been busy since reopening, he wondered how long it would continue after enduring “very, very tough” times.

“If I’ve got to work just to cover the rent and give the boys money for nothing there’s no purpose to stay on,” he said.

“Luckily I’ve got a good landlord, he’s still looking after me but I’m not sure for how long.”

The wedding industry is also on its knees with caterers, florists, artists, photographers, and bridal designers gathering in the CBD on June 15 to hold a public demonstration at Old Treasury Building where they called on the state government for more certainty and confidence.  

Olive and Thyme Catering co-director Renee Patsiaouras, who attended the demonstration, said she was suffering $80,000 in losses every month. 

“I’m already getting cancellations now for the end of June/early July because people don’t have the confidence to know what’s going to happen,” she said of her Clayton South business. 

“We’ve had phone call after phone call asking for credit, and having to reschedule.” 

“We need certainty; we need to understand that businesses can open and work COVID-safe.” 

Patrick Coghlan, CEO of credit reporting agency CreditorWatch, warned with no “clear path” to mass vaccination, and issues still emanating from hotel quarantine “we expect substantial increases in external administrations above the norm in the state”. 

The Collins Street Precinct Group (CSPG) said it was “very much looking forward” to the continued easing of restrictions and the return to normality.

“With the further easing of restrictions this week, we know that the CBD greatly needs the continued support from Victorians and we look forward to once again welcoming them to the Collins Street Precinct,” a statement from CSPG said.

“We are grateful for the funding that the State Government and City of Melbourne have provided to the precinct.” 

“This funding reinforces our efforts to support CBD businesses including a new campaign which we will launch this winter to encourage regional Victorians and Melburnians to visit, stay, shop, dine, do business and be entertained in the city.”

Last month the City of Melbourne launched an initiative to bring people back to the city, with visitors able to claim a 20 per cent rebate on their total food and drink bill at Melbourne’s restaurants, cafes and bars.

The state government announced a $460 million support package to support 90,000 businesses with grants of up to $7000. 

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

The Victorian Chamber of Commerce and Industry Chief Executive Paul Guerra said it was vital businesses get back to “viable trade as soon as possible” as the mental health toll from restrictions was “immense”. 

Restaurant and Catering Industry Australia CEO Wes Lambert said the lockdown had been a “crushing blow” to the thousands of restaurants, cafes, and caterers •

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