When the pandemic hit, Tim Elvidge was working for a food supplier that connected on restaurants for most of their business.
Once restaurants closed there was no need for food and eventually Elvidge was laid off.
“It was really awful at that time,” said Elvidge, who has been working for small business owners since he was a kid, old enough to make a pizza and operate a cash register. “There was so much uncertainty in the world.”
During his career in the food service industry he was always the teacher. The leader, showing others how to run a business. After losing his job, Elvidge decided maybe it was time he started doing it himself.
“In other words practice what you preach,” Elvidge said.
He took about a year, researching businesses that were doing well and taking stock of his own skills and interests before he decided to open his own pizza franchise.
“I made pizza at home from scratch and my friends and family were always saying, ‘You got to open your own restaurant,’” Elvidge said, noting his family is Italian and a lot of what they did revolved around food like homemade pizza, pasta and his grandma’s meatballs. “Good food was important to us. If someone went on a trip the first thing we would ask is ‘What did you eat? What kind of food did they have?’”
So, he took the advice of his family and launched his own business. In 2021, Square One Pizzeria in Mount Clemens was among the small businesses in Michigan working to survive the economic impact of the pandemic. However, by then many restaurants that specialized in take-out food were clearing revenues rather than losses.
According to Opportunity Insight’s Track the Recovery, Michigan small business revenue increased by 24% compared to January 2020 compared to the national rate of 6.9%. Over the past two years, Michigan ranks 10th in small business revenue growth while recording the fattest small business job growth in 23 years, according to the Bureau of Labor Market Information and Strategic Initiatives.
In Michigan, as of January 16 2022, the number of small businesses open increased by 7.9% compared to January 2020.
Macomb County saw even better numbers. During this same time period the number of small businesses open increased by 10.7% compared to January 2020. Wayne County also saw an increase of 16.7% whereas Oakland and St. Clair counties both experienced a decrease of 6%.
In terms of revenue gains in the United States, as of January 16 2022, total small business revenue increased by 6.9% compared to January 2020.
Michigan — as with most states — saw business revenue decrease by 56.3% in March of 2020. It dipped even further in April (-57.3%) but rose in July and has been increasing ever since, even as high as 56.9% in December. As of Jan. 16, 2022 business revenue was at an increase of 24%.
That’s 8% higher than the rest of the country.
In Macomb County business revenue increased 67%.
Other counties in the Detroit area also saw dramatic increases in business revenue this year: 97% in St. Clair County and 73.3% in Wayne County. As of Jan. 16, 2022, Oakland small business revenue in Oakland County was up by 17.4% compared to January 2020.
All of the counties experienced high revenues during the holiday season in December.
Successful small businesses
What helped Elvidge was not only the convenience of online orders and quick deliveries but he offered more bang for your buck. That goes a long way with consumers who are struggling with high gas prices and shrinkflationa term used to describe paying the same amount of money or more for a product that has been downsized.
“I feel like a lot of the pizza chains have been coasting for a long time,” Elvidge said, while watching his employees chop their way through a list of fresh ingredients needed before opening at 11 am “I wanted to come out with the kind of pizza I had when I was a kid.”
It’s a winning equation, he believes. It takes the same amount of work to do a subpar pizza as opposed to the best. Sure, the costs are a little higher on his end but he believes that people will appreciate the effort.
His manager said the strategy is paying off.
“We have many loyal customers who keep coming back,” said Brandon Ortiz of Harrison Township, who insists that’s one of the reasons the franchise is thriving. That and the fact that their pizza blows away any other deep dish pizza in the area.
That’s a mighty claim considering the market.
“There’s a lot of great pizza in Michigan,” Elvidge said. “Even our worst pizza is good compared to other states, which is why it’s also one of the toughest states to open a pizza concept.”
Next week he will celebrate his first anniversary owning a pizzeria that is growing in popularity; due in part to its buttery golden crust that is slightly chewy, topped with an Italian sauce that is both sweet and tangy, covered with fresh toppings.
“We made it. I’m excited,” Elvidge said. “We’re going to have an open house and the ribbon-cutting ceremony we were unable to have because of COVID. Revenues are great but the battle every week is the rising costs.”
Restaurant owners like consumers are paying more for produce, dairy products and meats.
“If I could figure out how to change weekly market prices on pizza the way cooks change the pricing on lobster and other seasonal seafood I would be doing even better,” said Elvidge, whose business is also supported by his family including his wife, Tracy and their daughter, Victoria, 5.
During the pandemic when Big Box companies were closed or out of stock on everything from desks and lawnmowers to kayaks and lamps consumers had no choice but to pay a little more for products close to home.
Small business owners also became more aggressive in their approach to lure consumers to their stores. During the holiday season for example, several toy shops in Macomb and Oakland counties made home deliveries and personal shoppers for seniors who were still not ready to leave their home. Others launched websites and Facebook pages to help consumers order their products.
It paid off.
“Economically these are tough times for everyone, but there are many small businesses surviving and thriving,” said Lisa Diggs, founder of the Buy Michigan Campaign. “For the most part, they are the ones that diversify their offerings, build relationships with their customers, and embrace technology.”
Diggs added a lot of the small businesses open in Michigan began as side hustles to bring in extra money. Others are home-based (businesses created) to avoid commute times and gas prices.
‘It’s everything from soap and sweets to web design and SEO (search engine optimization),” Diggs said.
It’s hard to say where most of these businesses are located because they are popping up all over the state but the numbers show several counties experiencing the surge of entrepreneurship.
Overcoming the hurdles
Despite the percentage increases, most small business owners say staffing remains their largest issue, though inflation is a close second, and that includes rising gas prices.
“It’s hard to stay stable, let alone grow, when you do not have enough help,” Diggs said.
Michigan’s economy, and the US economy for that matter, is flush with cash as people seek to spend freely what they didn’t, or couldn’t, during the darkest days of the pandemic. Even so, the increased costs of goods and services are causing people to pause and tighten their budgets while the state’s nearly 240,000 small businesses are hampered by a lack of workers and increasing costs.
According to a survey released by the Detroit Regional Chamber60.5% of Michiganders employed prior to the COVID-19 lockdown are still in the same job while 26.2% of those employed prior to COVID-19 are in a different one.
Another 4.3% of those employed prior to the pandemic are not looking for work while 12% of women have either retired or choosing not to work right now compared to only 7.7% of men.
The combination of the increase in retirements driven by the pandemic, continued strong consumer demand for goods and services, and the general shortage of high-skilled talent most in-demand by Michigan employers are driving the key factors in the ongoing labor shortage, according to the chamber’s survey.
“We’ve always known the shortage was coming,” said Kelley Lovati, president and CEO of the Macomb County Chamber of Commerce.
Experts warned of the Silver Tsunami. The term used to describe the wave of Baby Boomers, who would eventually reach retirement age and leave the workforce. The pandemic, however, prompted many older Americans to give their notice earlier than expected.
“Roughly 13% of the state’s workforce that was working in March 2020 is not working today and about 50% of the workforce aged 19 to 29 are in different jobs than they were pre-pandemic,” said Sandy Baruah, president and CEO of the Detroit Regional Chamber. “People are asking if the labor shortage is about a great resignation or a great shuffling. The answer is both. You have a lot of people shifting jobs and you have a lot of people who have left the workforce.”
Baruah added even with the economic challenges facing businesses, right now is a good time to start a business in Michigan as consumers have a lot of money to spend and a pent up need for goods and services.
Between January and May, nearly 57,000 new business applications were filed in Michigan, according to the US Census Bureau. That’s an increase of nearly 20,000 compared to the same time period in 2019. A White House report released in April found that Americans applied to start 5.4 million new businesses in 2021, 20% more than any other year on record.
Why would anyone open a business under the current conditions?
Quentin Messer Jr., president and CEO of the Michigan Economic Development Corporation (MEDC), said it’s happening because people are seeking a measure of control over their lives after months and months of uncertainty and no control over what’s happening.
“I think we’re seeing a greater willingness to take entrepreneurial risk when there’s a very tight labor market because there’s still going to be an opportunity for you to go back and find a job if needed,” he said.
Lovati competed saying the entrepreneurial spirit is strong. Small business owners have shown they can be resilient even in the midst of the challenges of supply chain disruptions, rising costs and staffing shortages.
“We have been extremely busy with grand openings for new businesses,” Lovati said, not to mention one year anniversaries. “It’s wonderful to see they have learned to adapt.”
The Little Bar Restaurant in Marine City is a prime example.
“The place was just packed,” Lovati said, of the family business in Saint Clair County, which actually saw a 6.6% decrease in new businesses in 2022.
Due to the workforce shortage the owner was forced to change his business hours. So, instead of being open seven days a week it was only open five days, Wednesday to Sunday, between 4 and 9 pm Others have done the same and Lovati believes the move could become a business model for the future.
The owner told Lovati in all the years that she’s been in business she’s never been more profitable than she is now. She has less shifts to fill and she’s created consumer demand.
“The changes were not by choice, at first, but customers are adapting,” Lovati said.
Oakland Press Staff Writer Mark Cavitt contributed to this article