Posted: 3:36 p.m. Monday, Sept. 30, 2013
By Jeremy Quittner
Inc. reports on how small businesses are responding to the looming impasse on the government budget proposal.
Inc. is reporting on the threat of a government shutdown at midnight tonight, if Congress can't agree to a government budget proposal. Return here for our up-to-the-minute coverage.
The U.S. Senate rejected a House budget bill this afternoon, stripping out amendments that would have delayed implementation of the Affordable Care Act, and setting the stage for a government shutdown starting at midnight tonight.
Global markets fell Monday and small businesses reacted with anger and alarm as the specter of a U.S. government shutdown edged closer to reality.
And though the implications of a shutdown that lasts a few weeks would be profound for small business owners across the country, causing a drag on growth for the remainder of the year and beyond, this year's Inc. 500 winners were not caught unaware, and many had planned for the eventuality.
Owners Like BNL Founder Larry Miller Are Angry
"This is an absolutely outrageous scenario enabled by inept lawmakers who are bogged down in their own private and unnecessary [interests]," says Larry Miller, founder and chief executive of BNL, which provides systems engineering and program management.
Miller's BNL is a prime contractor for the Departments of Defense, Treasury, and the Veterans Administration, among other government agencies, and his company has had a three-year annual growth rate of more than 1,000 percent. It is No. 391 on the Inc. 500 this year.
BNL, which had $6 million in revenue in 2012, prepared for a shutdown that could last as long as a month. Miller reached out to his 55 employees weeks ago and told them that they will not be laid off or furloughed, and that he will do what it takes to get through the tough times.
Practically, that means Miller has to continue paying salaries, health care costs that amount to about $1,200 per employee per month, and other benefits at a time when revenue is not flowing. His costs will, of course, increase.
"Most of our contracts are fixed-price cost accounting standard," Miller says. "There is a high risk we won't recover the cost."
Return here for Inc.'s timely coverage of how owners are coping with the threat of a government shutdown.