“Today I am speaking to you as someone who has already felt the effects of this uncertainty,” said Mary Lou Mackey, CEO of Beacon Interactive Systems, a federal contractor from Cambridge, Massachusetts that provides efficiency and cost-savings software to the defense department. “We, like many other small businesses in this sector, have had to tighten our belts in anticipation of the rough times ahead. In spite of successful pursuit of new opportunities, we have purposefully trimmed our workforce. This is counter to how we have strategically built our business over the last 18 years.”

The across-the-board cuts were devised as part of last summer’s budget and debt deal between President Barack Obama and Capitol Hill Republicans. They were intended to drive the supercommittee — evenly divided between Democrats and Republicans — to strike a compromise. But the panel deadlocked and, so far, no compromise has been struck.

Small businesses may be disproportionately hurt by the cuts because they tend provide services, according to testimony given by Mark Gross, CEO of Oak Grove Technologies in Raleigh, N.C., which provides training, information technology, intelligence and other services.

“For supplies, a company needs personnel, equipment, facilities, distributions channels, etc. For services, a company just needs people. It is easier for an agency to eliminate two data processors from a contract than eliminate a section of a fighter jet,” Gross said. “By cutting services in a greater proportion than products, sequestration will affect many more small contractors than large contractors.”

A White House report issued on Sept. 14 said that he $109 billion in cuts at the start of 2013 would be “deeply destructive” to the military and core government responsibilities like patrolling U.S. borders and air traffic control.

CONNECTING HISPANIC BUSINESS OWNERS

The Small Business Administration and the U.S. Hispanic Chamber of Commerce have started a pilot program in four cities and four states to increase the government’s outreach to Hispanic business owners. The program’s goal is to connect Hispanic owners with local lenders and counseling services. It’s also aimed at increasing the participation of Hispanic-owned businesses in the SBA’s government contract programs.

The program will start with four cities where there are Hispanic Chambers of Commerce: Austin and El Paso, Texas; Nashville, Tenn. And Philadelphia. Statewide programs are being set up in Florida, California, Ohio and Utah.

The Census Bureau reported after its last economic survey in 2007 that the number of Hispanic-owned businesses in the U.S. rose nearly 44 percent to 2.3 million. That was more than twice the 18 percent national rate of growth in businesses.

CASH FLOW PROBLEMS

Cash flow continues to be an issue for many small businesses, a sign that they’re still struggling with a slow economy, according to a survey of owners by Citibank.

The survey, which included 750 small business owners, found that 50 percent experienced a sudden cash flow crunch in the 12 months — even though 73 percent say they manage their cash flow daily. The biggest challenges they face in managing their cash flow are sales that are unexpectedly weak and late payment, or non-payment, from customers.

Payment problems mean some disquieting moments for owners. Twenty-three percent said making a call to a customer to request payment is the most uncomfortable finance challenge they face — second only to cutting staff.

But owners have also been lenient with their customers. Seventy-eight percent of those who participated in the survey said they’ve given payment extensions.