How Joe Biden’s Presidency Could Impact the Franchising Industry

President-elect Joe Biden’s administration signalled on Wednesday that it would act immediately to help small- and medium-sized businesses like restaurants, but the question remains if the U.S.’s struggling chains and franchises can make it to Inauguration Day. 

National Restaurant Association CEO Tom Bené told QSRMagazine just how dire the situation is for the country’s second-largest private employer, restaurants. 

“So far, 100,000 restaurants of all types have closed across the country, and another 40 percent are unlikely to make it through the winter without additional relief from the federal government,” Bené told the publication. “If just 5%of restaurants close their doors between now and the end of the year, at least half a million jobs would be lost. We must all work together to build a plan that puts the country, and our businesses, on the path to recovery.”

Early in the pandemic, Republicans and Democrats worked together to pass the CARES act, which included the Paycheck Protection Program. The PPP provided loans to small businesses, many of them restaurants, at 0% interest and with complete loan forgiveness for the portion of loans spent on employee wages. This program kept paychecks flowing to workers and businesses afloat, but the funds have long since dried up. 

Now, with a second wave of COVID-19 lockdowns popping up and indoor dining coming under fire in major cities, the situation looks dire again. Restaurant industry figures like Bené have again turned their hopes towards the federal government. 

“Now, more than ever, Americans are depending on their elected officials to work together to pass legislation to support the nation’s recovery,” he said.

Dr. Michael Osterholm, a coronavirus advisor to the president-elect, told Yahoo Finance on Wednesday he had a plan that involved propping up restaurants with federal funds to help them survive a second lockdown, which he hopes would stamp out the virus. 

“We could pay for a package right now to cover all of the wages, lost wages for individual workers, for losses to small companies, to medium-sized companies or city, state, county governments. We could do all of that,” Otserhome said. “If we did that, then we could lockdown for four-to-six weeks.”

Biden’s administration, like current President Donald Trump’s before him, will have to work with Congress to pass such a spending measure. At the moment, Georgia’s two senate races have gone to a runoff election, meaning the balance of power in the senate won’t be decided until early January.