This post originally appeared on The Hill
About 10 years ago, my small business almost went out of business.
At the time, my firm was involved in a very profitable project with a very large client. Things were good then. We were incurring hundreds of hours on the job and charging our maximum rate. The client promised a long relationship.
I thought about that experience as I listened to the testimony of a few of my fellow small-business owners this week at the House Committee on Small Business. They were complaining about how the recent federal shutdown affected their companies.
“The shutdown affected Port City by furloughing SBA staff who were working on a loan application for a new bottling line,” Bill Butcher, the founder of Port City Brewing Company grumbled. “Because of the closure we were unable to lock in an interest rate, which could increase the cost of our loan by thousands of dollars.
Butcher’s problems were understandable. And he certainly wasn’t alone. Heidi Gerding, CEO of HeiTech Services, Inc., a woman- and service veteran-owned small contracting business, complained that the shutdown had a “measurable impact” on her business and employees.
Other stories were reported around the country about craft breweries that were unable to get the permits to ship beer, business travelers held up on the issuance of passports and delicatessen owners who saw their lunchtime business fall away because of the lack of customers from a nearby federal building.
“Unfortunately, the stories we heard today of the lasting pain inflicted by the shutdown mirror countless others on Main Streets in every corner of America,” Chairwoman Nydia Velázquez (D-N.Y.) lamented.
I certainly sympathize with these people. I really do. But funny thing, though: I just didn’t see this in my own little world. During the entire month of January, I met and spoke with many of the hundreds of small-business clients my firm serves and asked them about the effects of the shutdown.
Across the board, the response was muted. Even in my own business, like my clients, the shutdown had no impact. We continued to work on projects, send out invoices, quote new jobs and deal with the same headaches.
I don’t think my experience — or my clients’ — was the exception. In fact, I believe that the grand majority of the 30 million or so small businesses in the country were largely unaffected by January’s shutdown.
Don’t believe me? Then why were so many jobs added, particularly by small businesses? Why is confidence still so high? Why was January’s economic growth in the Midwest (of all places!) so strong? Why is the service sector up, and why are purchasing managers planning on increased buys in the months to come?
Of course, not all the economic data is so positive because that’s just the nature of economic data. But aside from the small number of businesses that were impacted by the shutdown, why did so many others seem to emerge unaffected?
Maybe it’s because they learned something that I learned a decade ago when I lost that big client. I managed my business poorly. I made errors in judgment. The largest error was putting all of my eggs in one basket.
I disobeyed the cardinal rule that so many other small-business owners I know who have been in business for many years have learned: Spread the risk. My bad management almost ruined my business.
So to Bill Butcher and Heidi Gerding and all the other business owners who were impacted by the shutdown, I can only say this: Don’t complain. Like I learned from that experience, you should learn from this experience.
Ask yourself about your business model. Think about the dangers you incur when your entire business:
- is built around one customer;
- is located in a risky place;
- involves selling to an industry that’s exposed to a significant downturn; or
- involves shipping products that are reliant on government approval.
Maya Angelou once said “If you don’t like something, change it. If you can’t change it, change your attitude. Don’t complain.” I sympathize with the predicament and the challenges faced by the many small-business owners affected by the shutdown, but they shouldn’t complain. Like me, their difficulties are not the government’s fault. They belong to them.
Gene Marks is founder of The Marks Group, a small-business consulting firm. He has written on economic and financial issues for The Washington Post, The New York Times and The Guardian. He also frequently appears on CNBC, Fox Business and MSNBC.
(This post originally appeared on Philly.com)
For five weeks, thousands of small-business owners were forced to wait on much needed financing because the process for approving their Small Business Administration-backed loan applications was interrupted during the federal government’s partial shutdown.
Now that the government has reopened for business, many are expecting to see a quick resumption in loan processing. If that’s you, don’t get your hopes up.
Unfortunately, many experts estimate that the SBA will need weeks, if not months, to clear the backlog from the shutdown. Then there’s the looming threat of another shutdown if there’s no spending deal by Feb. 15, less than three weeks away. All of this means that the small-business owners, especially those needing working capital or equipment financing, need to have a backup plan.
The good news? There are options. Read More…
(This post originally appeared on The Guardian)
The US government shutdown, which is soon to enter its fourth week, is affecting travel, small business loan approvals, passport administration, national park services, food inspections and tax return processing. Most Americans can live with that at least for a while.
But there’s another consequence of the shutdown that could soon rattle American society: a disruption in the deliveries of craft beer. New beer labels must be approved in advance by the Alcohol and Tobacco Tax and Trade Bureau – which is part of the US treasury department – and because of the standstill in Washington this is not happening.
The result? Manufacturers of craft beers – many of whom are small businesses – are feeling the pinch. Thousands of applications are piling up and revenues are going, well, untapped. Read More…
(This post originally appeared on The Guardian)
As the partial federal government shutdown ends its second week, many workers without paychecks, as well as their families, are becoming increasingly worried about their personal finances.
That problem was on the mind of one fifth-grader in Gaithersburg, Maryland (a DC suburb), whose mother was furloughed from her job at the Food and Drug Administration back on 28 December. But instead of complaining, she, like any good entrepreneur, took action: she opened up a business.
The business is called Bella’s Sweet Scrubs and it’s owned by 11-year old capitalist and marketing whiz Bella Berrellez. Read More…
(This post originally appeared on Philly.com)
I guess if you’re going to partially shut down the U.S. government, now is the best time of year to do it.
The shutdown, which is officially entering its second full week, has cut back on the services offered by federal agencies including the Departments of Transportation, Interior, Agriculture, Commerce, and Treasury. Many small businesses not only rely on the services provided by these agencies but from the revenues that they indirectly generate. Already, some of these businesses are feeling the impact.
“This is the holiday season. I understand this,” Sam Samhori, who owns a small deli and pizzeria that caters to the lunchtime crowd near a federal office complex, told a local television station near San Francisco. “But right now it’s lunchtime and I have nobody.” Read More…
(This post originally appeared on the Huffington Post)
Back this past summer there were a few things that were very, very obvious.
We knew that Walter White was going to meet his demise (c’mon…too many innocent people were dying because of him). We knew that The Lone Ranger would be terrible (Johnny Depp as Tonto? Really?). We knew, at least those of us in Philadelphia knew, that the Phillies didn’t have a prayer of reaching the post season. And most of all, we knew that the government was facing a shutdown in October.
Everyone knew this. It was in the news, even back in July. The Treasury was making dire predictions. The President was warning the country. Sean Hannity was licking his chops, waiting for the battle to begin. And so it did. The big spending and debt ceiling battle that ended this week with an 11th hour agreement that kicked the can down the road to February. So the Republican leadership knew back then, right? Oh yes. They knew this was coming too. Way back in the summer. So what do you think they were doing back then? Playing golf all day? Pretending otherwise? Hoping that things would just be OK?
No. The leaders of the Republican party were making plans. I believe that we will learn about this one day. Seeing what just happened, it makes sense. And it’s what good leaders do. Read More…
(This post originally appeared on Inc.)
Back this past summer, a few things were abundantly obvious.
We knew Walter White was going to meet his demise. We knew The Lone Ranger would be terrible (Johnny Depp as Tonto?). Those of us in Philadelphia knew that the Phillies didn’t have a prayer of reaching the post season. And we knew that the government was facing a shutdown in October.
Even in July, it was in the news. The Treasury was making dire predictions. The President was warning the country. Sean Hannity was licking his chops, waiting for the battle to begin. And so it did. The big spending and debt ceiling battle ended yesterday with an 11th hour agreement that kicked the can down the road to February.
The Republican leaders knew this was coming too. So what do you think they were doing this summer? Playing golf? Hoping things would work out without too much ado?
The leaders of the Republican party were making plans.
It makes sense. And it’s what good leaders do. Read More…