In recent years, Dan Cerf’s party supply business, SF Party, was a staple in San Francisco’s retail landscape, recognized as one of the city’s premier retail and wholesale suppliers for events.
Established for over a century, SF Party offered an extensive array of products, including helium tanks, party balloons, popcorn machines, and confetti.
In 2015, the business gained entry into the city’s legacy business registry, a program that aimed to support long-standing enterprises by providing grants and assistance in navigating government procedures.
Between 2016 and 2019, SF Party benefited from more than $20,000 in city grants as a direct result of this designation.
However, the challenges faced by the business magnified when the pandemic struck, leading Cerf to declare, “It’s a crazy story, full of trials and tribulations, and it was never easy. But the pandemic killed us.”
Unfortunately, SF Party is not an isolated case.
Since the onset of the pandemic, 16 businesses have been removed from the legacy business registry after either shutting down or moving out of San Francisco.
This trend underscores the difficulties that even well-established businesses encounter in the city’s retail environment, despite accessing financial support.
The legacy business program, launched in 2015, was unique in the United States, utilizing marketing tactics to enhance the visibility of legacy businesses while providing various forms of assistance.
To qualify for the program, businesses must have operated within San Francisco for 30 years or more without any operational gaps exceeding two years.
As of this fiscal year, the grant program has a budget of approximately $1 million, according to officials from the San Francisco Office of Economic and Workforce Development.
From 2016 to 2023, roughly $3.5 million has been allocated to a total of 225 legacy businesses, with the average grant amounting to about $15,582.
Post-pandemic challenges have led to an increasing number of businesses being removed from the registry, despite past financial assistance.
Notably, seven of the removed businesses received nearly $75,000 in total grants before their closures or relocations.
One such example includes Ermico Enterprises, a skateboard manufacturer founded in 1986 in Potrero Hill, which received over $30,000 before ceasing operations in 2022.
Cerf remarked that although the $20,000 grant from the city was appreciated, it fell short in sustaining SF Party amid the drastic decline in the events market due to the pandemic.
Ultimately, Cerf sold the business to an employee who then relocated it to South San Francisco, where it now operates under the name Pop SF.
Reflecting on the legacy business program, Cerf stated that the support received from the city was beneficial in many ways, and he appreciated their effort at City Hall.
“Instead of taxing us into oblivion or coming up with new rules,” he noted, “it was something that was positive.”
However, opinions on the program’s effectiveness vary significantly.
Sharky Laguana, a former president of the San Francisco Small Business Commission, criticized the program as an ineffective use of taxpayer funds, arguing that the grants are insufficient to stave off operational challenges faced by businesses, including soaring rents and evolving consumer habits.
Laguana questioned whether the city could better allocate its resources toward initiatives that would foster new commercial ventures rather than focus solely on long-standing establishments.
In contrast, David Harrison, the director of public policy at the San Francisco Chamber of Commerce, praised the legacy business program as a resounding success, despite the exit of a handful of businesses.
According to Harrison, the program provides invaluable assistance to businesses in need and emphasizes the importance of being proactive in addressing operational hurdles.
He remarked, “In an adapt-or-die world, the program knows when businesses are struggling and they can make interventions when necessary.”
Harrison attributed the removal of certain businesses from the registry to a broader shift towards online shopping preferences, rather than solely the performance of the legacy business program.
He emphasized that there are numerous success stories stemming from the program, adding that the city can do much to alleviate bureaucratic obstacles for small enterprises.
Harrison commended initiatives like Mayor Daniel Lurie’s PermitSF plan, which seeks to streamline the permitting process for small businesses.
As of now, the legacy business registry still contains over 400 businesses, demonstrating some resilience among long-standing companies amidst an increasingly challenging economic landscape.
While the removal of 16 businesses since 2022 is notable, city officials acknowledge that maintaining a 100% success rate is unrealistic in today’s retail climate, which remains difficult for many.
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