Turn up the Holiday Cheer With a Company Shutdown This Year (Plus Save on Overhead)

What does a holiday company shutdown have to do with lower overhead and COVID-19? Turns out, a lot. Major corporations like Best Buy, Target, and Walmart have already announced store closures for Thanksgiving 2020 due to the pandemic.

Find out what exactly is a holiday shutdown, weigh the pros and cons, and—if interested—learn how to do it.

What is a holiday shutdown?

A holiday shutdown is when a business closes up shop due to a holiday. The closure could be for a few days, a week, two weeks, a month … you get the picture. During this time, the business’s operations cease and employees do not perform work. Generally, employees are briefly furloughed.  

Temporary business closures during the holidays are most popular during the month of December (e.g., Christmas shutdown). But, you can do a shutdown anytime there is a federal legal holiday or other holiday. 

Here are just a few examples of when you might close down your small business:

Partial week shutdown for Thanksgiving Week-long closure during the Fourth of July Two-week shutdown for Christmas and New Year’s 

Typically, a business shutdown is mandatory unpaid time off employees must take. Depending on your business’s policy, employees may be able to use their paid time off (PTO) during the shutdown. 

You might be wondering: what exactly is the point of a holiday closure? In addition to giving you and your employees time away from work, you could save money on overhead. During a shutdown, you aren’t using power, which cuts down on your electricity, water, and gas usage. But, we’ll go into that more when we weigh the pros and cons…

Pros and cons of a company shutdown: Holiday edition

A company-wide shutdown for the holidays may not work for all businesses. Consider the advantages and disadvantages before closing up shop.

Pros

There are a number of reasons why businesses shut down during the holidays, such as to:

Boost morale Lower overhead Prevent sickness

Even if you’re a workhorse (which describes nearly all small business owners), you likely know the importance of recharging. By taking a mandatory break from work, you can boost your and your employees’ morale. And if you’re worried about making up for lost time, consider the idea that happy workers = better engagement and productivity. 

By pausing operations for a week, you can cut out overhead expenses, which could help balance out the lost revenue. And if you notice less sales during the holidays, the shutdown could be a win-win for your business. Why spend on overhead when customers aren’t coming in? 

Last but not least, shutting down your business around the holidays—particularly in the winter—could help slow the spread of sickness. This advantage couldn’t be more appealing to small business owners than during the era of COVID-19.   

Cons

Of course, there’s a flip side to every coin. Before jumping into a holiday shutdown, consider the disadvantages, like:

Missed sales opportunities Stressed employees Disgruntled customers

Do the holidays line up with your business’s busy season? If so, a company shutdown might not be the right move for you. Let’s say the month of December brings in 20% of your annual revenue. If you close your business down for two weeks during this month, you could be missing out on 10% of your annual

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