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BusinessCoronavirus

COVID bringing layoffs to some LI business-to-business firms, big gains to others

Dean Florian, left, president of Florian Food Service

Dean Florian, left, president of Florian Food Service Inc., and company vice president Robert Love at the corporate cafe in Bohemia, which sees just a smattering of customers. Credit: James Carbone

At Dean Florian’s corporate cafe in Bohemia, empty tables dot the dining area. A smattering of customers — standing six feet apart on marked stickers — form a queue to order from Florian’s servers, who are masked and gloved and line food stations from behind Plexiglas shields.

"It’s what we need to do to stay safe, but it looks like a fish bowl," said Florian, the president of Florian Food Service Inc. The company, headquartered in Bohemia, operates 29 corporate eateries for workers on Long Island and in Queens office buildings, but only 15 have reopened since early July.

The eateries "are only at 30% to 40% of their capacity," said Florian, who owns the business with Robert Love, the enterprise’s vice president. Adding to the company’s woes, corporate-paid special events, such as summer barbecues and holiday parties, have evaporated.

As a result, since the March shutdown, the 36-year-old company’s food service business has plunged 75% and its employee count has plummeted from 120 to 45 workers, Florian said.

Although his company intends to rehire when more of its locations reopen, that process has been "very slow," he said, and by law, his venues can seat only half of their capacity.

"Corporate dining has been crippled," Florian said.

Despite the local labor force’s gradual return to the workplace, the pandemic is having a mixed impact on business-to-business companies. While some Long Island firms continue to register sluggish revenue, others are beginning to post strong gains — especially if their products and services help the corporate crowd get back to work.

Long-term, the outlook appears bright for the recovery of the region’s B2B community, said John Rizzo, chief economist at the Long Island Association. Since the Long Island economy before COVID-19 "was quite strong, B2B’s should thrive once we get a vaccine and businesses can operate more fully," he said.

In addition, as corporations reconfigure their workspaces to keep their employees socially distant from one another, office furniture and equipment companies are among organizations especially well-positioned for an accelerated turnaround, he said.

With the onset of the coronavirus, DeLuca Cleaning Systems experienced more than a 50% drop in business, forcing the Bay Shore janitorial and sanitation enterprise to lay off half of its 130 employees. But at the end of April, as businesses sought the company's services — from electrostatic spraying and deep antibacterial cleaning to day porters and sanitation stations — DeLuca welcomed back the 65 employees it had temporarily laid off, said president Brian DeLuca. Newsday is among DeLuca's clients.

Along with 85% of its corporate customers returning for its disinfection services, DeLuca has scored new business, including manufacturers, and it is now servicing 15.3 million square feet of buildings per day, a gain of more than four million square feet daily over last year’s amount. The net result: DeLuca’s year-to-date revenue is up 15% over last year. .

But that increase comes with risks.

"We’re busy because of COVID-19, but we hope that there’s a resolution soon," DeLuca said, "because we’re on the front line of a potentially dangerous situation."

Although the pandemic continues to hurt other B2B companies, Doug Betensky, owner of Upside Business Consultants LLC in Hauppauge, said there are varied ways to surmount a pandemic-fueled downturn.

His suggestions include pursuing contracts with government-financed institutions, such as hospitals and schools; developing e-commerce sites to reach more corporations in different locales and industries; and, depending on the B2B’s product line and services, focusing on the consumer market. B2Bs can also sell such COVID-19 staples as thermometers, sanitizers and gloves to generate add-on sales.

Additionally, Betensky recommends using downtime to cut overhead by reviewing expenses, improving inventory control and renegotiating contracts.

"It’s a very sad and hard time for a lot of people but a time of opportunity to put your business into a better position," he said.

Corporate Office Furniture Inc. is among B2B firms that have pursued new marketing strategies to boost their business. With year-to-date sales having dropped 50% and despite snagging furniture orders from such entities as the U.S. Tennis Association in Flushing, the 28-year-old company with headquarters in Bohemia, has done everything from converting its website into an e-commerce site to telemarketing. Bill Bellion, corporate office’s president, also has reached out to his company’s landlord to waive a scheduled rent increase and extend payment on outstanding rent.

In contrast, Bellion’s other B2B enterprise, Corporate Transport Express Ltd., has been swamped with calls and work. It offers white-glove residential delivery and installation services on behalf of its corporate clients, which are mainly interior designers and retailers.

Bellion attributed the company's 40% revenue jump to increasing telemarketing to designers and delivering large furniture orders to homes in upscale locales, such as the Hamptons.

"People are putting money into their homes instead of traveling," Bellion said.

At the two-employee PJD Business Machines in Farmingdale, which saw sales come to a screeching halt during the pandemic’s early months year-to-date revenue is down nearly 40%, owner Phil Dachille estimated. Although business picked up from mid-July to the beginning of September, it has since "slowed down significantly," possibly because of the upcoming election and fears about a spike in COVID-19, said Dachille, whose 27-year-old company sells, leases and services copiers, printers and all-in-one copier, scanner and printer units.

Dachille credited the earlier upturn to companies opting to purchase more machines, including multifunctional desktop units, in order to keep employees socially distant from one another. PJD also supplies machines to corporate employees who continue to work from home.

"We’re never going to make up for [the loss in business] this year," Dachille said.

For his part, Florian is thankful that the corporate market isn’t his company’s sole income source. His business also creates food packages for clients of nonprofit and government-funded senior and children’s nutritional programs.

Since the pandemic, these food programs have increased 35% in both volume and sales, Florian said, and where they had accounted for as little as 5% before COVID-19, they now represent 50% of the company’s revenue.

"We had considered this as an ‘extra,’ not a business we relied on," Florian said. "It’s spooky how it’s changed."

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