In the past week the Federal Government rushed the economic stimulus package through Parliament in order to start getting financial assistance out to where it is needed the most – into the community. This is good news, but these payments could still take some time to apply for, and receive. So don’t wait. Make the business decisions you need to, now.
By ATB Partners
There are a number of very welcome and very sensible initiatives in the government stimulus package for small, medium and micro businesses and we encourage you to explore what your business is eligible for.
But just be aware that all of these, for example, the JobKeeper subsidies, the lump sum support (up to $100,000) as well as rent-help, could still take some time to arrive.
So right now, above all else, you need to protect your cash flow.
Cash flow is the lifeblood of business. And it needs stabilising urgently. You need to ensure that you’ve got enough in the pipeline to keep moving, and you’ve got some in reserve.
With many small businesses now on mandatory trading suspension, it’s time to make tough decisions about staffing levels, and plan your business continuity, – how you’re going to tackle the challenges and come out the other side with your business intact.
If you’re in the unfortunate position of having to let staff go, ensure that you still follow the appropriate workplace legislation with regard to their rights and entitlements. We’re all hurting at the present, but we’re also all in this together. It’s imperative to do the right thing by your people.
Help them to understand what welfare options are open to them – for those needing jobseeker allowances there is also going to be a ‘Coronavirus’ supplement available temporarily, and there will be no waiting periods or asset tests.
Remind your staff that they can access their superannuation if they really need to. And remind them that internet providers, electricity companies, credit cards and banks all have financial hardship services they can assess if need be.
As far as the business itself – pay everything that’s urgent, and then go through what’s not.
Contact the ATO if you need to make deferred or late payments, discuss potential rent decreases with your landlord, or talk to your bank about the options around mortgage relief.
Find ways of shifting burdensome inventory, and make payment arrangements with your suppliers.
You must expect too, that you will need to be negotiable with your clients and customers. Chances are that outstanding debts are going to be difficult to recover, so be prepared.
This is an unprecedented time for all of us, and there is no doubt that small and medium sized businesses are going to bear the brunt of this Coronavirus crisis as it wreaks havoc with the economy over the coming months.
But SMEs also have an advantage here – they’re much more innovative and nimble than the big guys. The basic principle of nature is not ‘survival of the fittest’. Survival comes down to the basic ability to adapt to changing circumstances.
Coronavirus will definitely change the way we work and live, that’s a given. But those changes are inherently difficult to predict right now, so we need to tap into our imaginations and consider all the possibilities, all the potential, all the opportunities… as well as all the risks.
But, as the old saying goes: ‘We can triumph over adversity”.
A great example of this has been Husk Distilleries in Tumbulgum, Northern New South Wales. The company swiftly figured out how to make hand sanitizer and capitalise on booming demand. Husk has converted its cellar door into a drive-through outlet, so you can purchase their famous gin, and hand sanitizer, without even getting out of your car.
The Australian Reptile Park is another business capitalising on the clear frustration of Mums and Dads who now have the task of ‘homeschooling’. The Reptile Park is offering educational live streaming of its inhabitants from Monday to Friday. While it’s not necessarily making any money from this, right now, it’s certainly lifting spirits, and rest assured families will remember this favourably when there are options to unleash the kids on the weekends again. At some point down the track perhaps the operators will figure out how to develop an online product as an adjunct to their core business.
For now, the most important thing to do is protect your cash flow. But the second most important thing you must do, is not lose hope.
Change, after all, is the only thing we can count on.
We have a lot of FREE resources on our website that you can access including a business continuity planning toolkit, a 5-step process that will help to kick-start your creative thinking and take control of your business, as well as a library of blogs. And if you need help, we’re here to provide it. Contact us here or call (02) 8660 0993.