I won’t let you shut me down. Even if you are the US Government (Govt.)

There are many stakeholders involved in the US Govt. shutdown.

In the short run businesses can be affected by such an event, as any projects, which are ongoing alongside the govt., will immediately be put on hold. This could cause consumer and investor confidence in the company to decrease, thus driving share prices down significantly as the revenue stream is withheld. In the long run, their budget reports may be affected due to undelivered work or a lack of financial reporting for the time period of the shutdown. In turn, this may affect future bank loans and the credit history of the company.

In order to prepare for such crises, businesses can hold financial reserves to keep operations going. However, it is hard for the company to budget such a scenario due to the uncertainty involved. Secondly, by holding the hiring of new employees or deployment of new R&D. Lastly, they can focus on critical deliverables during the period of the shutdown, by keeping only those employees in the office who are essential to the execution of the projects.

Overall, a govt. shutdown is not ideal, but business owners can take precautions to keep it from shutting their business down!

Word Count: 200

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Blog post in relation to – http://www.bbc.co.uk/news/business-24328353

An example of a firm bracing for the shutdown – http://www.inc.com/jeremy-quittner/small-business-responds-government-shutdown-threat.html

Check out my friend Gabriel’s blog for more interesting business blog posts! – https://blogs.ubc.ca/gabrielchua/

 

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