6 minute read
The secrets of small business survival
The secrets of
Small Business Survival
BY BRENDAN NIXON
When you are heading towards retirement the last thing you want is to see your small business go belly up! It’s important to regularly check the health of your businesses.
Small businesses are vital for the nation’s economy, accounting for nearly 98% all Australian businesses and employing 2.2 million people (ABS February 2019), but they have been pushed to the limits over the last year with devastating bush fires and the unprecedented disruptions of COVID-19.
More than a third (35%) of Australian businesses expected to find it difficult or very difficult to meet financial commitments last year (ABS August 2020) and since then they’ve faced lockdowns, diminishing government subsidies and staff shortages.
If this sounds all too familiar to you, and you are a small business owner in need of some advice, I have prepared two vital checklists that are a great starting point to find out exactly how healthy your business is.
Checklist for a healthy business Your business is making a profit. You should be able to see a consistent revenue stream and a steady profit every month, even if it is only small.
This is a sign your business has a strong financial future. You have a comprehensive business plan. Your plan should outline your goals and future projects for not only this financial year but the next, taking in predictions of the economic climate, cost of staff and any projected increase in product and possible new competition. Expenses are not increasing. To keep your profit increasing you must make sure your expenses stay flat, and do not grow faster than your revenue.
Expenses naturally increase when
your business has a growth spurt, but they should stay in line with the revenue boost. Your website is performing well. Check Google Analytics to see if your number of customers and views is increasing. You should be across key
SEO words which will attract new customers. Your industry is healthy. Check what is happening with similar businesses.
Is the Industry stable? Is your business up to date with new and competing industry trends? Your cash balance is increasing. You need a healthy amount of cash in the bank to cover any urgent expenses.
You should not use all your profits to cover your costs or invest back into your business. Cash is king! You have new clients and repeat customers. Do you have a steady stream of new clients, and are retaining existing customers? If so, your business has many options to generate revenue. Debt ratios are low. There are two debt ratios to examine: a business’ debtto-asset ratio and its debt-to-equity ratio. Solvency formulas specifically measure how much your business owes compared with how much your business is worth. A lower number is ideal. New projects are on the horizon. Even if your business is doing well now there needs to be strong signs of growth. You need to have solid projects in the pipeline to make sure your business does not become stagnant. This is especially important as many hospitality and retail
businesses need to adapt to the disruptions caused by the pandemic.* You can also work out the well-being of your business using the quick checklist below. If any of the following points apply to you, then your business wellbeing may be in jeopardy, and I would recommend seeking external advice. You can’t pay your debts. If you are constantly struggling to find cash to pay mounting debts – or simply owe a lot of money – your business is in poor financial health. If you have studied your cash flow carefully and can’t see a way to get back on track, your business is in trouble. Decreased profits. Your business is fallible if your profit is slowly dwindling. Profits go down if you are not attracting any new customers, or your need to offer big discounts to get existing customers through the door. You have no access to finance. Your business could collapse if you cannot access finance from a reputable source when you need to. You must have a good relationship with a finance facility to help when finances are tight. Poor financial records. Solid financial records are the backbone of your business, and it’s critical you keep your records up-to-date and monitor them regularly. You need both experience in financial matters and an understanding of a business owners’ obligations. Are your records up to date and accurate? Internal conflict. Communication problems between the owner/manager and workers signals internal conflict which will affect your business.*
*SOURCE: SM SOLVENCY ACCOUNTANTS
Brendan Nixon, Partner at SM Solvency Accountants, is one of Australia’s leading insolvency experts, having worked in the field for more than 20 years. SM Solvency Accountants a specialist Australian accounting firm providing both practical and advisory services for corporate and personal insolvency matters. It offers zero contact liquidations through its easy-to-use digital service. https://smsolvency.com.au/
Travel further with a Mobility Scooter
If you have difficulty walking, standing or getting around, or suffer from multiple sclerosis or arthritis, a mobility scooter can help you maintain an important measure of independence when running personal errands, shopping or travelling. One of the benefits of a mobility scooter is the ability to take them on public transport and other accessible vehicles, such as some taxis. This means that no matter what your ailment or ability level, owning a mobility scooter makes it easier to get from A to B.
Premier Mobility Centre has conducted extensive research throughout the Central Coast, Hunter region and beyond to find the most advanced and highest quality scooters available in our current market. Using their knowledge and expertise, they have negotiated with several manufacturers and suppliers throughout Australia to bring our region exclusive brand and superior products at affordable prices.
They have an extensive range for you to choose from with a great selection of unique and popular models with very helpful features. Their range includes new and used mobility scooters from travel and portable to large all-weather designs. They stock scooters that disassemble to fit the boot of your vehicle and conversely, scooters with long range batteries capable of up to 70km without requiring re-charge – a great benefit if you need to nip to the shops and back!
When deciding on getting a mobility scooter, you may need assistance in making an informed choice. Premier Mobility will come and visit to consult with you in your decision. During these free consultation, they will help to assess your situation Some considerations are: the extent of your physical challenge and whether it is a long or short term issue, your mobility, your safety, your budget, your living situation and the surrounding area. They will endeavour to find the absolute best fit for your individual circumstance. Trade-ins are welcome and assessed on an individual basis. They have several financing options including Rent to Buy, Eftpos, pensioner financing to approved purchasers and they also accept NDIS clients. Premier Mobility provide after sales support, servicing, repair and the facility to deliver your scooter and provide you an in-house demonstration to show you how to safely use your new equipment.
For valued customer’s convenience, they have an easy to navigate website and a showroom which is conveniently located at Long Jetty. Their staff are committed to excellence in customer service and look forward to serving you.
Premier Mobility Centre Phone 4333 7004 or call in to the showroom: Cnr Anzac Rd & The Entrance Rd, Long Jetty www.premiermobilitycentre.com.au
