The aim of the Paycheck Protection Program (PPP) was to save jobs and give small businesses a boost during an unprecedented time that saw demand for many products — including tires — drop with a thud.
And we believe it has achieved its goal, despite some reports of misappropriated funds.
The Small Business Administration (SBA) provided businesses with 500 or fewer employees PPP loans that are fully forgiven if used for payroll, interest on mortgages, rent and utilities.
Recently, after a growing demand for more transparency, the SBA released more details about the loans.
The reality is that the PPP was an emergency program put into place quickly. Oversight was sacrificed for speed. And with any program, there are those who look to take advantage.
But for business owners who really needed help, PPP loans came like a glass of ice water in the hot, dry desert.
When the COVID-19 pandemic hit, tire dealers were forced to make difficult decisions. Should they stay in business? Lay off or furlough employees? Many shops cut employee hours in an attempt to keep the "family" whole.
So, in early April, tire dealers seemed eager to apply for the loans. While everyone didn't make the cut before the first round of funds were depleted, many said the application process was easy, especially if you had a relationship with an SBA-connected lender.
In all, around $521 billion was funded through the PPP.
Overall, banks approved PPP loans to 5,765 companies that identified themselves as "tire dealers" that totaled between $598 million and just north of $1 billion, according to SBA data.
The SBA released only a range, not specific values. And the number of tire dealers could be more, too, if those businesses applied for the loan under another category, such as "auto repair/maintenance," as opposed to the "tire dealer" category.
The average loan for those in the "tire dealer" category ranged from $103,850 to $186,643.
The majority of tire dealers Tire Business has spoken to — with a wide range of political opinions —said they believe the program was a valuable lifeline at a difficult time.
Looking ahead though, we implore the SBA to release more detailed information to help us understand better how the program is working.
Certainly, a loan range of $500 million in the "tire dealer" category makes the number far from clear.
We are also curious as to know how many jobs (or businesses) were saved as a result of the program.
At the end of summer when the first loans come due, we'll be interested to hear from tire dealers about the ease of the other end of the process.
A bill — the PPP Small Business Forgiveness Act — has been introduced in the Senate to address this issue and allow those receiving loans of less than $150,000 a simplified one-page form instead of providing more detailed forms required now.
Do you think the PPP was a good idea? Was it a lifeline?
Understanding the pandemic and decisions that were made relies a lot on perspective.
And we encourage you, dear reader, to share your views on the program with us so we can more accurately understand if or how it has impacted your business.