MELBOURNE, Fla. — Gatto's Tires & Auto Service, which marks its 50th anniversary next year, survived the recent state shutdown by laying off several employees, shortening operating hours and applying for federal pandemic assistance.
The Melbourne-based dealership employs 63 at six retail locations along Florida's Atlantic Coast.
"Starting in March we saw an immediate drop in business. We have multiple locations but overall averaged about 40% down for the whole company," said Mike McHenry, Gatto's Tires marketing and inventory manager, as well as son of the dealership's president, Pam Gatto.
Despite the drop, he said he expects business to bounce back for the rest of the year.
"I'm kind of an optimist. I think things will get back to normal," he said, "and I think we're going to have a good year. These past six weeks where we were down, I don't know if we can make it up by the end of the year."
When he spoke to Tire Business in early June, sales were starting to come back as more customers resumed daily activities.
"Starting in the middle of March, it was like someone shut off a light switch. We stayed down at that number for the rest of March and all of April. Now in May we've definitely seen a significant uptick," he said.
"While we're not back to where we were, I'd say we're more than 50% back to the numbers we were doing before the whole coronavirus thing. … Each week in May it seemed to get a little busier overall.
"We have a total of six locations, so they are all up from what they were doing previously. My sense is, and my hope is, that by the end of June we'll be fully back to the number we should be doing this time of year. This is kind of our busiest time."
After laying off about 40% of its workforce in March at the start of the shutdown, Gatto's Tires has brought back almost all its employees, Mr. McHenry said.
He said he was concerned that some low-wage earners were making more with unemployment benefits during the pandemic and wouldn't want to return to work, but in the end all of the dealership's employees who were laid off wanted to return.
Part of the impetus could have been due to the time needed to apply for state and federal benefits and delays in receiving money, he surmised.
"Almost everyone that we laid off said they had problems. I guess the system was just overwhelmed with people all applying at the same time. It was weeks before they even started getting their first check," Mr. McHenry said.
"I was surprised. I thought some of the lower paid people, like the tire changers and so forth, would be like, 'No, we're going to stay laid off.' But they all came back."
Gatto's Tires also took advantage of federal pandemic assistance by applying for the Paycheck Protection Program, which provided payroll loans to small businesses.
Mr. McHenry said the funds "definitely helped."
"We were going to get through (the business slowdown) regardless, ... but it helped keep us going during the worst time. … It made us more comfortable about bringing people back that we had laid off before the business was all the way back. When we saw an uptick, we brought almost everyone back.
"We felt comfortable knowing we had that little bit of a buffer," he added, "whereas before, if we didn't have that (funding), if we were just relying on our own, we would have probably waited longer and been a lot more conservative about (bringing back employees)."