The Government Shutdown, How It Affects Your Business
The big news coming from Washington in the past few days has been surrounding the persisting Government shutdown. With Republicans and Democrats in the Senate at a stand still over various issues surrounding passing a continuing resolution to re-open the Government, it seems this stalemate could drag on into this week and subsequently further.
Government “shutdowns” occur when the Senate cannot agree to pass12 key appropriations bills which outline how funding will be allocated throughout multiple factions of the government. When these bills or resolutions are passed, they have an expiration date, often times annually, providing an avenue for compromise and for the government to continue its functions, resulting in these tense negotiations being revisited often.
During a government shutdown, various public or government-funded programs and organizations are forced to temporarily close and many of the federal employees working within them to see a pause in their paychecks. National parks, public museums, social programs, even the military are affected, in general terms; any government organization must sit at a standstill until a resolution is passed.
How does this affect small business? Many can feel the residual shockwaves of the existing shutdown should their business operate in connection with any government organizations. Should a company have clients or provide services to entities funded by the government they will see effects resulting in a temporary halt in orders, invoices not being met or other delays. Corporations working off government grants, funding or contracts can experience the same hindrances and delays most other organizations are working through.
How does your business navigate the current turbulent and uncertain governmental landscape? It is important to take an internal audit of your processes, clients and revenue generating elements within your organization ascertain if they hinge upon government funding and operation. If so, can you come up with an interim solution to continue the progress and operation of your business util the turbulence in Washington dissipates? Could be temporary funding alternatives through short term loans or extracting more value from clients or partners outside the government’s funding purview. The key to any successful business is to attain the ability to adapt and improvise, keeping the wheels turning regardless of the external environment.
Something to keep front of mind and in focus is to continually move forward and realize this is indeed temporary, the Government will open again, funding will resume, and federal employees will receive back pay for their missed paychecks. With that, it’s important, even if your business relies heavily on government funding or subsidies, to keep your operations afloat. It’s so common to see business owners unwilling to front cash to employees or take on new orders or clients while this shutdown is in effect. Not only will this leave you behind when things reopen, it can risk missing new avenues for your business to explore efficiencies and thrive, refining your internal processes and maintaining valuable relationships both inside and outside of your brand.
Amid an everchanging and volatile economy and marketplace, fostering the skills to foresee and navigate these inevitable ebbs and flows will establish your brand outlasting competition and attaining sustained success.
To gain personalized guidance for your business on this topic and others contact us.
- Vince Calace
Founder - Venture Business Development