This post first appeared in the Alexandria Times on May 27, 2016.
Frequently during an election year — at both national and local levels — we hear about the need to reduce burdens for small businesses. In many instances, this refers to the regulations and requirements to operate these businesses. Small businesses are acutely aware of the impact that compliance has on their bottom line.
In every survey of small business owners, regulatory compliance ranks at or near the top of the list of their greatest challenges. While larger corporations have specialized departments to handle such matters, it’s the small business owners who personally must try to understand and respond to these requirements. Doing so takes their focus away from their products, services and competition — the core of their operations.
Red tape and delays have particularly harmful consequences for owners at the very fragile startup stage, when their resources are thin. Entrepreneurs already are juggling many pressing concerns, and they desperately need to get their doors open to begin collecting revenue. Startup delays due to regulatory processes can be expensive, and a weak cash f low at the start may lead to failure down the road.
With elected officials and business owners on the same side of this issue, you might wonder why cutting red tape for small businesses continues to be an issue. Regulatory burdens are convoluted and complex matters — often products of outdated legislation and multiple layers of oversight. They typically were put into place with good intent and without recognition of the unintended consequences for small business owners.
Nearly everybody wants to help small businesses and agrees in theory with reducing their regulatory burden, but when specific revisions are proposed, some residents begin to fear that the floodgates will open and their protections will be eroded.
These regulatory matters are not easy to unhook, and the process of changing them does not happen overnight. But as a community, we should support the modernization of these requirements for small businesses.
Since the recession of 2008, city leadership has been particularly focused on the viability of
the small businesses that comprise such a large portion of our economy. In recent years, permitting processes have been streamlined and clarified, and City Hall has added facilitators to guide businesses through the process. The Alexandria Small Business Development Center also has developed a website checklist to help entrepreneurs better anticipate requirements and possible hurdles ahead.
This year, city staff has undertaken a complex effort to identify zoning ordinances that are costly and time-intensive for small businesses. Staffers are particularly focused on ordinances that seem excessive based on their limited community impact. These changes would also correct disparities that stem from business trends that were not anticipated when the ordinances were originally written. These changes will go a long way to supporting the growth of small business in Alexandria.
To attract successful, creative businesses to Alexandria, all of us — city officials, business leaders and residents — have work to do. We must minimize red tape and make sure every interaction with entrepreneurs is hospitable, respectful and encouraging.