Photographer and ShootProof user Patrick Williams (PWP Studio) has graciously shared his experiences over the last few weeks, along with actionable tips you can take right now to help mitigate the financial impact to your home and business. Feel free to leave questions for Patrick in the comments below!
First off, we are in this with you: my studio handles large corporate events.
We capture about 25 large large trade shows including WPPI and PhotoPlus Expo, large sporting events including the NFL Draft/Super Bowl, and had contracts on the Men’s and Women’s NCAA Final Four tournaments in ATL and NOLA; by most accounts, we are killing it. Wait, let’s make that past tense – we WERE killing it. Literally 100% of our business has been erased until July at this point. These days our book of business looks oddly similar to what we had 18 years ago when we started: NADA!
We are probably worse off than most because this crisis hit while we are dealing with a December breast cancer diagnosis/January double mastectomy/ February+March recovery journey with my wife, Angel. I haven't picked up a camera since December so I could be home to support my boo = I decided to BE the nurse instead of hire one!
Photo by Patrick Williams / PWP Studio
The studio's very first cancellation was the first week of March and it was to be my first shoot in 3 months. I hadn't even taken my extended medical leave out of office reply off my email when the cancellations started. I say all of that to say this: we had already depleted our rainy day fund, so this crisis caught us at a REALLY bad time. To add insult to injury, Angel is in the travel industry; she came back to work to find furloughs and job insecurity. We went from a solid six figure income to a solid four figure income in a matter of two weeks. Oh, joy.
So, my #1 goal over the past few weeks has been finding places to stop the bleeding -
searching for every opportunity I could find to keep what little cash reserves we have intact. In addition to the potential government support via loans, checks, and unemployment benefits that may become available, I wanted to share a some ideas with you on what we have done personally and in the studio to put a Band-Aid on this (hopefully) short term lack of revenue.
- Mortgage: We contacted our mortgage company to find out if we could defer payments, and if so, for how long. Every mortgage company is different and options available are dependent on what type of loan (Freddie Mac, Fannie Mae, VA, etc). One of my photographer friends was able to defer with no penalty for two months with his mortgage holder. On Monday, our mortgage company was only offering forbearance with limited terms ("forbearance with limited terms" with my lender = I can push the payment 60 or 90 days with no penalty, but the *entire balance* of the missed payments is due at the end of the push period), but I am checking back every couple of days because the "limited terms" get better every time I look. As an example, just yesterday, the repayment terms were modified to include "forbearance with extended no late fee repayment options up to 12 months". Banks don't want your house and they are under tremendous pressure from the government to be flexible, so call them and ask them what offers they have to keep you afloat!
- Car Loans: Both of our car loans (Bank of America and an out of state credit union) were happy to defer our next two car payments with no penalty and no fee = no payments are due on our cars until June. They charged nothing for this - just extended the length of the loan 2 payments on the backend.
- Small Business Administration: This is a big one! You can apply for a SBA Disaster Loan on https://covid19relief.sba.gov/#/. These loans feature low interest rates (no more than 4%) and long repayment terms (as much as 30 years), and the amount you may qualify for is based on your payroll, overhead costs, and past tax returns. This is a better option than keeping debt on credit cards!
- SBA Application Experience: I applied for the SBA Disaster Loan on March 23rd, they (the SBA) updated the loan app process on the 26th to include a $10k forgiven loan (we will call it a grant for now), so I went back to re-apply for that grant on the 30th. I haven't received any funds or loan app updates at this point.
- SBA Application Update: I called SBA on April 8, 2020 to check status on the 23rd loan app, the 30th grant app for the additional $10k, and ask about any info they could give me on the payouts for the $10k grant (I seem to remember them or media or SOMEONE mentioning a 72 hour payment if my bank was avail via prior tax returns - which it was). I started at "caller number 1,325" and it took all of 45 minutes to get through to a person - that was FAST!
- SBA Old Platform vs New: On my call on the 8th, I was informed that the March 23rd application/case was closed = replaced by the application/case I entered on the 30th. I now have one open loan application. They likely did the same for yours if you applied twice (once on the old platform and once on the new).
- SBA Status Updates: The old loan app would kick out emails to applicants letting you know status updates like "submitted", "in review" and "needs documentation", but the new loan app launched on the 26th does NOT have the ability to send emails when the loan app goes to the next step. My loan app HAD moved a bit (from "submitted" to now "in review"), but was frustrating to know the ONLY way to check status is to call, or if you get an email from an actual loan processor person
- SBA Fund Disbursement: The $10k grant was originally purported to be an "automatic forgiven loan you will get if you apply" and is now a "if you are approved for it" situation - which is a dramatic change in messaging from my first call to SBA on the 30th when I was initially told about it. The nice lady today also let me know the "funds being disbursed in 3 business days" was a farce - she had heard it too, but had no idea where that came from or when the funds might arrive she could only share that getting it was dependent on qualifying...and she couldn't tell me how that would be assessed. IMPORTANT: Misinformation from the people who are supposed to know should NOT be something that makes your blood boil right now – it is just an unfortunate side effect of an entire government jumping to help a bajillion people as quickly as possible! Take it with a grain of salt – the SBA reps would know more and the messages would be more consistent if they were taking their time and doing thorough training. Instead of countless hours of meetings and trainings prior to action – they are doing the best they can to take action and help us with limited meetings and trainings. Would you rather them be sitting in training or answering phones when you call for assistance? They are doing as much as they can.
- PPP: There is also the PPP (Payroll Protection Program) = one of the new pieces of legislation just passed last week will actually forgive/erase the part of the SBA loan monies you use to maintain your payroll to employees throughout this fiasco. Translation: a grant you don't have to repay meant to keep your staff intact through the turmoil as long as they stay on payroll during the eight weeks following the loan being funded. Win and Win!! Do this sooner than later because the funds are limited and the process will only get longer and longer as days go by. I applied through my bank (Suntrust/Truist) which was finally available on Sunday night. Pretty straightforward so far, but no idea when/if approvals will/won't happen. So far, they have been as efficient as the gov't (need clarifications on details that should be obvious, etc.) - more on that as I hear more.
- Worker's Comp Insurance: Are you paying Worker's Comp premiums for people that aren't actually working? Call your insurance company and find out what your options are!! Response will vary greatly and your biz functions may be very different than ours, but in our case: we we pay premium on our subcontract photographer labor and our internal staff. No photographers working means the lion share of our payroll just became a 0. We reduced the amount of payroll covered in our policy and it dropped our premium by 70% in the meantime.
- Business General Liability Insurance: Although we couldn't really mess with this very much because a large part of our biz insurance premium covers equipment that we don't want to jeopardize, every biz is different, and you may want to pause or cancel yours if you literally have nothing for months like we do. One of my friends was allowed to cancel/pause his completely for 60 days and he stuck his equipment on a rider on his homeowners policy. His insurance company let him know that if he reinstated the policy on day 59, billing would resume as normal with no fees.
- Business Insurance Billing: aside from changing coverage so our premium drops, there were wins on the insurance billing side, too. Our insurance company removed us from auto-pay, will send us a paper bill, and let us know they will not be charging late fees or canceling policies for nonpayment during this crisis. And yes, I asked: they will still cover claims during a time when your account is showing a late payment. So, umm, looks like I won't have to make that payment until later, too.
- Auto Insurance tip #1: decrease the miles driven on one or both of your car policies and your policy premium will drop. We cut $120 off my wife's 6 month premium by reducing annual miles from 13,000 to 5,000 miles driven per year....which may still be high considering we drive to the mailbox at this point.
- Auto Insurance tip #2: if you have a second car - or are COMPLETELY stationary with one car: my insurance company had a "storage" option. When I asked them if I could park my 2nd car in a safe spot and not drive it at all (AT ALL = ZERO DRIVING), they said "Absolutely" and it dropped my premium on the 2nd car by 70% (would have dropped the policy, but it is financed, so it has to be insured). Likely meant for long term collectors or military/biz folks with long deployments/trips, it also works nicely for #eventprofs with nowhere to go! The length of time it could be listed "in storage" was up to 3 years, and on the chance you decide to drive somewhere, just give them 24 hours notice to reflect it in the policy, and you can resume coverage on the regular policy. Every insurance company is different, but this was my experience with mine.
- Credit Cards (AmEx): Per Berlin Onumonu's suggestion (TY Berlin!), we called Amex to see what could be done with future payments. Although we didn't get an answer on the spot, we had a case created and from what the agent said, I believe we will have our payments deferred for the next 60 days with no fees.
- Credit Cards (Citi Bank): Called Citi to see if I could defer my credit card payment for two or three cycles and what that would look like. They said "Sure, we will waive the late fee, but interest will start to accrue per our standard rules." Keep in mind I have been a Citi customer on that specific account for 26 years with an average spend of $4k/mo. Upon airing those details (and laying it on thicker as I went) - I asked if there was ANYthing else that could be done to help a three decade customer going through a hard time. She asked me to wait another 5 minutes so she could run it by a supervisor - finally she replied, "We understand completely and will happily waive the late fee as a sign of our dedication to helping our long-time clients like you." I waited 2 hours to have them pat me on the head and thank me for three decades of my business (CC fees on ~$500k in transactions and $1000's in interest when I self-financing the start of my business years ago) with a $35 late fee waiver. Doubt they will make it to 27 years in my wallet....
- Random Expenses: cut my cable. Get comfortable with Netflix and Hulu, etc - with no sports, the local/live news is the only reason to keep it and it is 100% depressing bullshit right now anyway.
These are just a few examples of what we have done, and just a warning – DO IT OVER THE PHONE no matter how long it takes because the quantity of people trying to do the same is overwhelming – I don't think email requests will get anything done right now. BoA hold time to get to the customer service agent was 3 hours. SBA has been 45 minutes to 1.5 hours. It has taken a LONG time to get it done over the phone, but I have action and confirmation of the action. These tips I have shared on managing bills, mortgages, creditors, etc. have so far eliminated about $15k from the cash I need on hand between now and June...at zero cost to me for late fees/interest, etc. It took some time, but as stated previously, I have plenty of time and not plenty of money!
The Gift of Persepective
Lastly, I don't wish our personal cancer journey on anyone, but it has given us an amazing gift: perspective. Angel is thriving and getting better every day. No matter how bad this CV stuff gets and how much financial struggle it causes us, 2020 has been a BIG WIN for our family because she is still with us. We are blessed beyond words, and we reinforce that between ourselves and with our boys every day. Chances are, if you pull your head out of the hysteria and business loss, you will see blessings are everywhere around you!!! GOOD LUCK!!!!
Photo by Patrick Williams / PWP Studio