39 per cent of small businesses are now saying that the conclusion of JobKeeper will have a significant impact on their viability, up from 29 per cent in November 2020.
The survey of 1,000 small business owners also found that a further 51 per cent expected it to have a moderate impact, with just one in 10 saying it would have no impact on their business.
Australian businesses have had many months to consider their position and plan for what lies ahead. While many have certainly done this, others have been reluctant to take stock and make changes.
As the government continues to rule out an extension, what can business owners do to ensure their business remains sustainable in 2021 and beyond?
Explore four top tips from Myssy + Co:
1. Cash flow
What is your current cash flow like and how is it predicted to be after Job Keeper? Knowing when cash is coming in and going out, and having the right tools to deal with fluctuating sales is key.
We recommend getting a rolling cash flow forecast to gain insight on your business position. While preparing a cash flow forecast is a good start, it is not enough in itself. Ensure you regularly stress test your forecast as well review actual performance against budgeted numbers.
2. Staffing
Have your staffing needs changed? The changed environment may mean you need more or less staff, or training of current staff may be needed.
Be careful here. Staffing is one of the biggest expenses for SMEs and has also been an area where businesses have had some degree of government support over the past year.
But adjusting that cost base can be expensive. Understand that redundancies are a major expense if you are planning to cut down on full-time staff. Non-tangible expenses such as a potential drop in morale should also not be overlooked.
3. New revenue streams & business opportunities
Will your current revenue streams recover or will new streams become available? Getting the right working capital in place will allow your business to capture the opportunities that have come out of the pandemic.
Behavioural shifts like remote working and direct online sales have transformed the way many businesses operate. Now is the time to consider what has worked well, what you want to continue doing, and if you can take advantage of any of these new trends to create new opportunities for your business.
4. Deferred liabilities
If you have deferred commitments such as loan repayments or rent, will you be able to meet these now that payment holidays and deferrals have expired?
No matter what, be upfront and proactive with key stakeholders. Whether that be your landlord, finance provider or supplier, we recommend you present a solution rather than being caught out when it’s too late to put an alternative arrangement in place. It is important that this arrangement can be met by your business and not as a short-term fix to placate a supplier.
Whoever you need to seek support from, have a plan and do your best to articulate a solution to them.
We’re here to help
We can help you put together a post-pandemic plan. Our advisors can help you navigate the ever-changing landscape and guide your business to sustainability in 2021 and beyond.