Operations
How Mooyah Ops VP helping franchisees land, navigate PPP funds
Of the Mooyah franchisees who applied for PPP loans, all but four received them, which totaled $3,419,200.
June 17, 2020 by Cherryh Cansler — Editor, FastCasual.com
Although PPP loans were designed to support small businesses to keep their workers employed and cover other necessary expenses, many restaurants have struggled to obtain the funds. Out of 2,200 small business owners surveyed across America, for example, only 13% of the 45% who applied for the loan were approved.
That's not the case, however, for Plano, Texas-based Mooyah Burgers, Fries and Shakes. Out of the franchisees who applied, all but four received PPP funds, totaling $3,419,200, Mike Sebazco, VP of operations, said during an interview with FastCasual
"We are continually updating information about the PPP program and ensuring the necessary loan forms were completed timely and accurately," he said. "We also set up informational webinars and conference calls hosted by our recommended lending facilitator, our corporate accounting and auditing firm, as well as the Texas Restaurant Association."
Mooyah also received a "modest PPP loan," according to Sebazco, who said that the COVID-19 pandemic, of course, has taken its toll on the 85-unit chain. Three locations chose to suspend operations temporarily but have since reopened; two locations closed permanently, and nine non-traditional locations (KidZania, a casino, the Riverwalk, college/office campuses) were required to suspend operations.
"Pre-COVID, we were on an upward sales trajectory," Sebazco said. "March and April hit us hard, but we were as prepared as we could have been with off-premise delivery, takeout and curbside pick-up in place."
May and June have been a recovery period as dining rooms have begun to partially reopen in most states.
"In spite of the crisis, we've actually had seven restaurants with three-year record-high sales weeks," Sebazco said. "We had one restaurant for three weeks in a row with record sales in May. Those restaurants beating sales records are implementing the dining room re-open strategy the best, with Guests seeing our teams taking safety and cleanliness very seriously while continuing to execute operations well."
Education never stops
Although most of the Mooyah franchisees have received their loans, Sebazco's work isn't over. His team is now working with operators to ensure that they use the funds correctly in hopes of avoiding paying them back.
"We use a PPP tracking tool and calculator along with calls and email communication regarding where they stand in forgiveness and impact amount with unforgiven money," he said.
Communicating the changes to franchisees regarding loan requirements is also ongoing. For example, the government last week reduced the payroll requirement from 75% to 60% and extended the payback period, which allows businesses to use more of the funds to cover rent and utilities under the forgiveness guidelines and gives them more time to pay back the unforgiven portions.
"This provides more flexibility for our franchise partners," Sebazco's said. "For amounts that are unforgiven, granting a 5-year payback versus 1-year gives us a better chance to maintain a better cash position while repaying the loan."
For other restaurants still trying to navigate the rules, Sebazco said he recommended tracking full-time equivalent employees and their wages and closely monitoring the forgiveness category to not only be funded but forgiven.
"Also, it's important to build relationships with your local lenders versus big banks," he said.
About Cherryh Cansler
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