Many business owners on the Sunshine Coast are currently operating with an increased level of uncertainty in the back of their minds. As a business owner, it is important to know your numbers and whether you are trading profitably or not. Since the start of the pandemic we have seen how important it is for business to be prepared, adaptable and ensure they are in a healthy financial position to enable them to ride out the current ups and downs.
Below we outline some strategies that may assist with maintaining a healthy cashflow position and building your ‘war chest’ to remain viable during snap lockdowns.
- Analyse what your cash outflow requirements are over the next 6 to 12 months and review this on a weekly basis. Cut unnecessary spending immediately. Monitor your bank account and any other cash reserves daily. Where possible build your cash reserves during the good times so that you can be prepared for the harder times.
- Try to negotiate better terms and be proactive in managing your debts. Renegotiate terms of payment with your suppliers, where possible to relieve cashflow pressure. Talk to your bank around options to restructure debts and interest rate reductions to reduce repayment commitments. It is important to get in touch before the due date for any payments.
- Communicate openly and honestly with your employees. Share details of the actual and possible future impacts of COVID-19 on your business. Employees for whom you do not have enough work could be encouraged to take leave or accept reduced hours. To find out more about changing work hours or duties in this context, go to the Fair Work website for updates.
- Follow news and social media outlets to stay on top of incentives available, eligibility criteria and the application process. Your business may be eligible for government incentives and concessions. When you receive stimulus support, be careful with how you allocate the resources to ensure it is the best use.
- Reach out to your advisors for support. If you are feeling overwhelmed in business or personally, always seek help. Sometimes it may just be a fresh sounding board to run ideas or strategies past. Other times it may be mental health support. The Department of Employment, Small Business and Training have released a free mental health coaching program to assist small business owners. Follow this link for more information.
As always, the team at MJJ Accounting are here to support you, please reach out as needed.