• Menu
  • Skip to right header navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

PlanningShop

Plan. Start. Grow.

  • Our Products
  • Instructors
  • Entrepreneurs
  • BizGear
  • Rhonda’s Blog
  • Book Rhonda
  • About PlanningShop
  • Search
  • Our Products
  • Instructors
  • Entrepreneurs
  • BizGear
  • Rhonda’s Blog
  • Book Rhonda
  • About PlanningShop
  • Search
Shutdown

Shutdown Hurt Your Small Biz?

January 30, 2019 //  by Rhonda Abrams

No one is paying small businesses back.  The federal government shutdown may be over—at least temporarily—and some government employees may get back pay—but no one is reimbursing millions of small businesses hit hard by the shutdown. They’re hurting, and they’re unlikely to recover soon, if at all. What can small businesses do to recover from this shutdown and prepare for the next time a President or Congress decides to shut down the government?

“I don’t think there is a point of recovery, and that’s the unfortunate part of this shutdown,” said Aron Schultz, event manager of Claudia’s Steakhouse in Washington, D.C.. “You can’t recover from loss of sales. You can’t encourage your guests to return and eat more food to replace the loss of sales during the shutdown or replace the happy hours that had to be cancelled during the shutdown.”

More than one in five small businesses were directly impacted by the shutdown, according to a recent survey by the HR company Paychex.

That’s a whole lot of hurt companies, their owners, and employees. The impact wasn’t just lost income. Loans, approvals, contracts—all were held up, including loans backed by the Small Business Administration (SBA), which guarantees over $30 billion in small business loans.

“When a government shutdown freezes loans already in process, it can really have devastating effects on these businesses,” said Luz Urrutia, President of Opportunity Fund of San Jose, CA, the nation’s largest nonprofit micro and small business lender. “A shutdown does real damage for a small business owner who is in the process of getting a loan to start or expand their business—and that has ripple effects for their workers, their communities, and the rest of the economy.”

“Even though the shutdown is over for now, we’re concerned about the speed with which government agencies can address the backlog of small business needs,” said John Arensmeyer, founder and CEO of Small Business Majority.  “After all, this is a temporary reprieve and we don’t know how much progress can be made before the government may close again.”

It wasn’t just the SBA’s closure that damaged small businesses. Other federal agencies’ closures also did lasting damage. “One of the things that was most surprising to me as a small business owner was how the shutdown’s impact trickled down to impact businesses that, on the surface, appeared to have no connection to it or the government,” said Megan Driscoll, Founder and CEO of EvolveMKD, a marketing communications agency. “For example, we had several clients whose drug filings were seriously delayed, throwing off everything from marketing plans, hiring a sales force, and starting manufacturing.  Those are private sector jobs that now will not start when they were supposed to.”

The shutdown won’t soon be forgotten by small businesses, who recognize that Trump could shut down the government again when his three-week reprieve ends.

“One of the things we could do on our end to prepare for another shutdown is just spend less by buying less alcohol or less food so we can have less waste and maintain the inventory we have so we’re not overstocked,” said Shultz of Claudia’s Steakhouse. “This is not a positive thing for us to do; we’ll have to tell our vendors we want less.”

What can small businesses do to help protect themselves if Trump or a future President decides to shut down the government?
  • Diversify your customer base if possible. Yes, the federal government and its workers may generally be great customers, but they shouldn’t be your only customers.
  • Create a reserve fund. Small businesses run on small profit margins, so it’s tough to put money aside. But if you can create a “rainy day” cushion, you’ll sleep better at night.
  • Establish and maintain extra credit. Once again, it’s often tough to get sufficient credit to run day-to-day operations, but try to build your credit capacity with banks and credit cards. (Avoid new ‘fintech’ lenders who may charge exorbitant interest rates).
  • Develop excellent relations with your vendors. In another shutdown, you may have to turn to vendors and ask for a little more time paying bills.
  • Remember your pain at election time and vote. Many Senators refused to vote to re-open the Government over Trump’s objections. They didn’t stand by you—don’t stand by them.

Copyright Rhonda Abrams, 2019

This article originally ran in USA Today on January 31, 2019

Share this:

  • Twitter
  • Facebook
  • LinkedIn
  • Email

Category: Solution CenterTag: business, Donald Trump, entrepreneur, funding, government, rhonda abrams, shutdown, small business, small business tips, Trump, USA Today

Previous Post: «Instagram star 7 Tips to Make You an Instagram Star
Next Post: 11 Best Startup Competitions »

Primary Sidebar

Subscribe to Rhonda's Blog via Email

Instagram @rhondaabrams

Sign up for my newsletter - get small business tip Sign up for my newsletter - get small business tips and the latest info. sent straight to your inbox! Link in profile~
.
.
#smallbusiness #newsletter #smallbizguru
What’s old is new again! How to stay in front of What’s old is new again! How to stay in front of your smallbiz customers, in my latest @usatoday column. Link in profile~
.
.
#smallbusiness #customer #digitalmarketing #smallbizguru
National Doughnut Day on Friday?? Great way to sta National Doughnut Day on Friday?? Great way to start the weekend!! Enjoy, and go find yourself some doughnuts 😋 🍩 
.
.
#smallbusiness #fridayfeeling #nationaldoughnutday
#smallbusiness #tuesdaythoughts #entrepreneur #ins #smallbusiness #tuesdaythoughts #entrepreneur #inspirationalquotes
“And I’m proud to be an American, where at lea “And I’m proud to be an American, where at least I know I’m free. And I won’t forget the men who died, who gave that right to me.” - Lee Greenwood -
.
.
#memorialday #neverforget
We're heading into a long weekend! Here's to some We're heading into a long weekend! Here's to some R&R, productivity . . . whatever your small business needs~
.
.
#smallbusiness #weekend #entrepreneur #fridayfeeling
Sign up for my newsletter - get small business tip Sign up for my newsletter - get small business tips and the latest info. sent straight to your inbox! Link in profile~
.
.
#smallbusiness #tips #entrepreneur #newsletter #smallbizguru
#smallbusiness #tuesdaythoughts #inspirationalquot #smallbusiness #tuesdaythoughts #inspirationalquotes
Here's to a great week, small business owners! . . Here's to a great week, small business owners!
.
.
#smallbusiness #smallbusinessowner #mondaymotivation
My Tweets
  • Sign up for my newsletter - get small business tip Sign up for my newsletter - get small business tips and the latest info. sent straight to your inbox! Link in profile~
.
.
#smallbusiness #newsletter #smallbizguru
    What’s old is new again! How to stay in front of What’s old is new again! How to stay in front of your smallbiz customers, in my latest @usatoday column. Link in profile~
.
.
#smallbusiness #customer #digitalmarketing #smallbizguru
    National Doughnut Day on Friday?? Great way to sta National Doughnut Day on Friday?? Great way to start the weekend!! Enjoy, and go find yourself some doughnuts 😋 🍩 
.
.
#smallbusiness #fridayfeeling #nationaldoughnutday
    #smallbusiness #tuesdaythoughts #entrepreneur #ins #smallbusiness #tuesdaythoughts #entrepreneur #inspirationalquotes
    “And I’m proud to be an American, where at lea “And I’m proud to be an American, where at least I know I’m free. And I won’t forget the men who died, who gave that right to me.” - Lee Greenwood -
.
.
#memorialday #neverforget
    We're heading into a long weekend! Here's to some We're heading into a long weekend! Here's to some R&R, productivity . . . whatever your small business needs~
.
.
#smallbusiness #weekend #entrepreneur #fridayfeeling
    Sign up for my newsletter - get small business tip Sign up for my newsletter - get small business tips and the latest info. sent straight to your inbox! Link in profile~
.
.
#smallbusiness #tips #entrepreneur #newsletter #smallbizguru
  • Footer

    Our Products
    Instructor Central

    Privacy Policy
    Contact Us

    • Email
    • Facebook
    • Instagram
    • LinkedIn
    • Twitter

    Copyright © 2023 PlanningShop · All Rights Reserved · Site design by paulinaart

    This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. ACCEPT Read More
    Privacy & Cookies Policy

    Privacy Overview

    This website uses cookies to improve your experience while you navigate through the website. Out of these cookies, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may have an effect on your browsing experience.
    Necessary
    Always Enabled
    Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
    Non-necessary
    Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.
    SAVE & ACCEPT