The global pandemic of 2020, COVID-19, has caused widespread movement restrictions, social distancing, and business closures in an effort to drastically slow down the spread of the highly contagious disease. Small businesses, said to be the backbone of the Australian economy, have been hit the hardest. These businesses usually have tighter profit margins and fewer cash reserves compared to larger corporations, making them highly susceptible to even short-term closures. Here are some cash flow tips to help you and your business survive, thrive, and securely stay afloat until things are back to normal,
Planning And Making Financial Adjustments
Cash flow forecasting is always important to a business of any size, but it’s even more important right now. Forecasting allows you to see if and when you might run out of cash and it’s key for advance planning. Xero and QuickBooks Online have launched a cash flow tool within their software which is very helpful when managing cashflow.
Cutting Expenses And Working With Suppliers
Take a hard look at expenses and cut out unnecessary subscriptions and costs. Proactively call suppliers, creditors, and landlords to let them know your current financial situation and make repayment or payment arrangements. Visit the Australian Government website for information about relief for commercial tenants.
Continue Working Under Crisis Conditions
Working From Home
Your business might not have to stop running simply because the office is closed; some work can be done from home. Have all essential personnel work from home using laptops, smartphones, and video conferencing services like Zoom, Skype and Google Meet.
Delivery And Curbside Services
If you offer food, clothing, or other products consider switching to doing curbside pickup or contactless delivery while you are shut down.
Communicating With Customers
Make the most of this time to build stronger relationships with your clients. Understand their cash position and if needed enter into payment arrangement or get deposits.
If you do not already have one consider having a Debt Policy that will help you and your clients stay on top of what is owed.
Keep your customers up to date with what services you are offering and how you are working to protect them while meeting their needs with email, social media, and live video.
Marketing And Being Creative
Step Up Your Marketing Game
Now is a great time to work on re-branding or putting together new marketing campaigns to hit the ground running when things open up. You can also market right now on social media for any goods or services you have available during this restricted time. Live video streaming on social media lets you stay in contact on a personal level.
Launch Inexpensive New Products And Services
Product and service launches can be quite costly but smaller ones can move quickly and be used for short term gains.
Government Assistance -Australia
- The Coronavirus SME Guarantee Scheme
- Loans of up to $250,000 are available from April 2020 to September 2020 for qualifying small to medium sized business.
- Cash Flow Boost
- Up to $100,000 is available to qualifying small to medium sized business
- $1500 fortnightly is available for qualifying sole traders, businesses and their employees. This wage subsidy is available for 6 months from May 2020.
- Instant Asset Write Off
- If your businesses’ turnover is less than $500 million you can write off assets purchased and ready for use for up to $150,000 in this financial year ending 30 June 2020. In the next financial year accelerated depreciation is also available.
- The Coronavirus SME Guarantee Scheme
- To fully benefit and to find out if your business qualifies for the above Government initiatives, have a chat with your Financial Expert.
Crowdsourcing Or Fundraisers
Crowdsourcing and fundraisers could be a great idea for small community-orientated businesses looking for support from locals. Many people are passionate about helping local businesses right now and you’ll be surprised at the help you may receive.