{"id":988,"date":"2020-08-05T16:12:07","date_gmt":"2020-08-05T06:12:07","guid":{"rendered":"https:\/\/www.marshallfreeman.com.au\/blog\/?p=988"},"modified":"2020-10-01T16:29:52","modified_gmt":"2020-10-01T06:29:52","slug":"what-your-business-needs-to-get-through-covid-19","status":"publish","type":"post","link":"https:\/\/www.marshallfreeman.com.au\/blog\/what-your-business-needs-to-get-through-covid-19\/","title":{"rendered":"What your business needs to get through Covid-19"},"content":{"rendered":"

What your business needs to get through Covid-19<\/strong><\/h1>\n

To say 2020 hasn\u2019t been kind to Australian businesses would be an understatement. With both Australia and New Zealand technically entering a recession due to the impacts of COVID-19, small businesses have been struggling to adapt to the new norm and the follow-on effects it is having. Despite the many businesses looking to control cash flow and keep their head above water, it\u2019s not all is gloom and doom, as there are steps you can take to reclaim control and weather the storm.<\/span><\/p>\n

Governmental measures to slow the spread of the virus is primarily aimed at protecting communities\u2019 health and their livelihoods, after all, small business is the heartbeat of the economy. But instead of working as a springboard to relaunch the economy towards a healthier state, the enforced isolation has eroded demand and significantly crippled business revenues in many industries.<\/span><\/p>\n

When the Australian Bureau of Statistics released its August 2020 report, it\u2019s was clear for all to see that we have entered unprecedented times. Almost 41% of companies reported a drop in revenue, while over a third foresaw problems fulfilling their future financial obligations.<\/span><\/p>\n

We are currently living in the crossroads between mandated isolation to protect our health and the toll this is having on the economy. It\u2019s for this reason that businesses now more than ever, need to adapt and plan accordingly to help minimise the impact of COVID-19 and come back stronger than ever.<\/span><\/p>\n

 <\/p>\n

Cashflow control has become critical management.<\/strong><\/span><\/h2>\n

The future of the pandemic is uncertain and so is the path of Australia\u2019s economic outlook. With new laws and regulations being set down to try and get a handle on the situation, businesses, unfortunately, continue to struggle. With revenue streams drying up and increased uncertainty in the market, the management of your business\u2019s cash flow in the present and near future will be in some cases critical to survival.\u00a0<\/span><\/p>\n

Not all businesses have been impacted equally, however a large majority of businesses will need to adapt to different scenarios and look at creative ways they can survive in the current environment.<\/span><\/p>\n

Avoid the mistake of only considering one scenario, as your forecasting needs to be flexible to adjust to changing circumstances. In an unstable environment, you are always going be faced with variations, whether this is new laws and regulations that have a direct impact on your particular industry or perhaps your customers can no longer pay their invoices \u2013 so consider multiple scenarios and have a plan in place to pivot.<\/span><\/p>\n

Think long-term. How can you improve operational efficiencies, or grow new revenue streams? Forecasting with a longer-term view in mind will help you understand and be more prepared if demand is still affected in six- or 12-months\u2019 time. Varying scenarios should be considered and planned with actionable steps to manage the slowdown.<\/span><\/p>\n

Be cautious about external solutions. Kate Carnell, Small Business Ombudsman, has\u00a0stated<\/span>\u00a0that while some of the solutions proposed by the government can indeed be helpful, they also have the potential to wrench control away from small business owners. You need to create an integrated, scenario-based financial model to take back the reins. Only then will government-proposed solutions work for you instead of the other way around.<\/p>\n

Some ways to independently improve your cash flow management include speeding up invoicing, incentivise early payment or collecting debts more efficiently. You might also want to look into implementing flexible working hours or leave, as well as selling assets and streamlining inventory to improve your business\u2019s liquidity.<\/span><\/p>\n

 <\/p>\n

10 things your business can do to defeat the impacts of COVID-19<\/strong><\/span><\/h2>\n

At such an uncertain time, it\u2019s tempting to wait for the future to crystalise before taking action, however, it\u2019s important to pivot and foresee potential issues through being proactive rather than being reactive and getting left behind.<\/span><\/p>\n

As we briefly outlined earlier in this article, planning and forecasting your cash flow, profit and loss, and balance sheet position for different scenarios will give you the right information to make more informed decisions. You\u2019ll be better positioned to understand what direction you need to take whether that is financing, or perhaps negotiating new credit terms with suppliers and customers to improve your cash flow.<\/span><\/p>\n

 <\/p>\n

We have outlined some key areas your business can review to put you on more solid footer without delay. Evaluate which of these areas are most useful for your business based on your financial forecasting.<\/span><\/p>\n

 <\/p>\n

    \n
  1. Take care of your health<\/span><\/strong>: Both mental and physical health are put to the test by the financial crisis. Ensure you and your employees are staying healthy to prevent long-term problems.<\/span><\/li>\n<\/ol>\n
      \n
    1. Update your scenario-based financial plan<\/span><\/strong>: As we\u2019ve discussed, being aware and prepared for all scenarios is key to effectively managing your cash flow.<\/span><\/li>\n<\/ol>\n
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      1. Update your financial information<\/span><\/strong>: To craft a comprehensive forecast, you need to make sure all of your financial records are accurate and update to date.<\/li>\n<\/ol>\n
          \n
        1. Improve short-term cash flow<\/span><\/strong>: Don\u2019t wait until you\u2019re between a rock and a hard place – sell non-essential assets and try to encourage early payments.<\/span><\/li>\n<\/ol>\n
            \n
          1. Seek supplier solutions<\/span><\/strong>: Get on the same page and create a win-win scenario that will help both your business, suppliers and customers.<\/span><\/li>\n<\/ol>\n
              \n
            1. Get your bank involved<\/span><\/strong>: With an updated forecast of your financial position, your bank is more likely to cooperate in helping your business on advantageous terms.<\/span><\/li>\n<\/ol>\n
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              1. Reduce operating costs (if possible)<\/span><\/strong>: Carefully review your entire operations to see how you can trim back on costs and drive more efficiencies across the business.<\/li>\n<\/ol>\n
                  \n
                1. Risk management<\/span><\/strong>: Due to the sudden increase in remote working, IT security, insurance, and human utilisation are more important than ever.<\/span><\/li>\n<\/ol>\n
                    \n
                  1. Keep an eye on productivity<\/span><\/strong>: Falling productivity rates are a possibility in the transition to remote working. Look to adopting technology to help you review your employees\u2019 work and their day to day requirements.<\/span><\/li>\n<\/ol>\n
                      \n
                    1. Employee leave<\/span><\/strong>: Depending on your situation, your liability could benefit from your staff taking leave, be it long service leave, annual, or unpaid. Minimising redundancies is crucial to protecting cash flow.<\/span><\/li>\n<\/ol>\n

                       <\/p>\n

                      Without a positive cash flow position, businesses will find it hard to survive in the current climate, so planning ahead and being proactive will ultimately help you react faster and make better business decisions. \u00a0<\/span><\/p>\n

                      Scenario-based cash flow forecasting and management should be your first step. Your business will be in a much stronger position to weather the storm of the impacts of COVID-19 and give you the foundations of business growth post the pandemic.<\/p>\n

                       <\/p>\n

                       <\/p>\n

                      About Marshall Freeman<\/strong>
                      \nMarshall Freeman is Australia\u2019s leading\u00a0debt collectors<\/a>\u00a0and recovery specialists. We have been servicing over 20,000 businesses throughout Australia for over 15 years, which has set the foundation of deploying industry-leading knowledge and collection techniques that simply delivers results that are unrivalled. Whether you need assistance with slow payers or collection of bad debt, we offer a transparent and stress-free collection process that makes your debt a priority to get you paid faster.<\/p>\n

                      If you\u2019re looking to partner with a result-driven\u00a0debt collection agency<\/a>, please feel free to call us on\u00a01300 136 271<\/strong>\u00a0or get an obligation\u00a0FREE debt appraisal<\/strong>\u00a0by filling in the form on this page.<\/p>\n","protected":false},"excerpt":{"rendered":"

                      The top 10 things your business can do to help improve its cash flow and weather the storm of COVID-19. We address critical areas to help you protect their long-term growth.<\/p>\n","protected":false},"author":1,"featured_media":993,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[10,7],"tags":[],"_links":{"self":[{"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/posts\/988"}],"collection":[{"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/comments?post=988"}],"version-history":[{"count":6,"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/posts\/988\/revisions"}],"predecessor-version":[{"id":995,"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/posts\/988\/revisions\/995"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/media\/993"}],"wp:attachment":[{"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/media?parent=988"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/categories?post=988"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/tags?post=988"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}