Seasonal businesses (landscaping, ice cream shops, sports training facilities, and shore-related enterprises) are accustomed to thriving during the warmer months and struggling when the leaves turn brown. Any seasonal company that has been around for several years, understands the need to conserve cash from the peak periods and save it for the off-season.

The big problem for such businesses is that the coronavirus pandemic is that it has drastically cut – or will soon cut – revenues during the peak season. For instance, in New Jersey, it is unclear whether Governor Phil Murphy will allow people to return to the Jersey Shore. That, of course, depends on whether the spread of the coronavirus has been contained by beach season.

If beaches remain closed during the summer, it will be a devastating blow to the Garden State’s economy. Owners of rental properties from Atlantic Highlands to Cape May are worried that the windfall of money they get for their properties near the shoreline will not materialize. The property owners rely on rental income both to pay the mortgage and to generate revenue. The money might not come this year.

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Places like Jenkinson’s in Point Pleasant and Casino Pier Amusement Park in Seaside Heights will be in dire straits if social distancing regulations remain in place after Memorial Day. These attractions help generate customers for places like Kohr Brothers Custard, which operates more than a dozen locations in New Jersey, as well as shops in Rehoboth Beach, Delaware, and Ocean City, Maryland. Naturally, T-shirt shops will remain shuttered if beachgoers are kept away. For an estimate of the economic impact, consider this: in the popular beach resort town of Wildwood, NJ, there are three dozen T-shirt shops in a two-mile section of boardwalk.

Nightclubs in Atlantic City and hot spots like the legendary Stone Pony in Asbury Park and Bar A in Belmar will see their revenues decline dramatically even if they are allowed to open. Restaurants all along the Jersey Shore will suffer tremendously if summer renters and day-trippers don’t fill them in June, July and August.

There is no doubt that countless businesses on the Jersey Shore will have to file for bankruptcy if restrictions are not lifted by summer. Additionally, the shore towns themselves, which derive revenue from the sale of daily beach badges for visitors, will see their revenues plummet.

Getting cash now

Half of independent business owners say that they will have to shut down in less than two months if they don’t get financial help, according to a new study by the NFIB. The research found that 92% of small employers currently are negatively impacted by the coronavirus pandemic. Among negatively impacted small employers, 80% report slower sales, 31% are experiencing supply chain disruptions, and 23% report concerns over sick employees. Similar, if not worse, results can be expected for businesses along the Jersey Shore and other popular beach areas.

Savvy seasonal business owners have already planned for the slow months. The fortunate ones are those who have enough reserves from last year to sustain their companies for several more weeks until the restrictions hopefully are lifted. Those who have not planned well are in serious trouble, as they may not be able to sustain another month or two of social distancing restrictions.

What can companies do now to survive?

Apply for government-backed funding
Businesses can start putting together financial strategies for survival. For instance, many restaurants and bars that operate year-round are likely able to apply for CARES Act Payroll Protection Program (PPP) funding now. The ones that have not yet opened, may qualify for SBA Economic Injury Disaster Loans.

Renegotiate fixed costs
The normal playbook is thrown out the window right now. Even fixed costs are negotiable at this time. Landlords (not all, but some) have shown a willingness to make concessions on their payment timeframes and even the amounts due. Not everyone will be so magnanimous. However, it is worth it to try. After all, if operations are slow, business owners have more time on their hands to try to renegotiate contracts and cut costs as much as possible. Landlords and other creditors who play hardball are also playing with fire. If companies go out of business and file bankruptcy, they creditors may never be paid, or they will have to go through costly legal battles to get their money. There is indeed financial incentive for them to work out revised arrangements with small business owners.

Reduce marginal costs
With business substantially slower, staffing levels can be cut. Many organizations have furloughed their workers, which has allowed them to apply for enhanced unemployment benefits that have been put into place because of the coronavirus crisis. Employers who want to keep all their workers paid may then have to cut both their hours of operation and the number of staff during each shirt.

The economic impact of the coronavirus pandemic is immense, and among the most pressing questions are how long it will last and how quickly can the business sector recover once restrictions are lifted. COVID-19 may prove to be more devastating that Superstorm Sandy on Jersey Shore businesses. The difference is that this time, there is advance notice for small businesses to plan for a dry spell. The challenge, obviously, is whether the planning that the business owners can do will be enough to sustain them.

Rohit Arora, CEO of Biz2Credit, is one of the nation's leading experts in small business finance.