As the number of Coronavirus cases increases in Australia and around the world, we are left wondering what the full impact of the Coronavirus pandemic will be on our community. We have seen this impact the world greatly in many ways including an effect on the economies of the world. However, there are actions that you can take as business owners to protect your livelihood and it is important for small business owners to start taking action now. Below are some tips to minimise the risk to your business.
1. Clear communication
Clear communication is essential to maintain a strong connection with your employees. Be open and share how COVID-19 is affecting your business as well as what the possible future impact could be. Ask for the support of your employees and involve them in brainstorming solutions for how the business can get through this time.
2. Communicate with all key stakeholders Again, communication is key.
Timely and transparent communication with your customers and suppliers is important. You need to communicate with customers about any issues with the delivery of your products and services and what contingency plans you have in place. You can discuss with suppliers and renegotiate payment terms if necessary and talk to your bank if you are unable to meet your loan repayments. Also, review your debtors and consider offering discounts for early payment.
3. Take advantage of the Coronavirus stimulus package.
Your business may be eligible for government incentives and concessions.
- An increase in the instant asset write-off scheme up to $150,000.
- Payments of up to $25,000 for businesses with a turnover of up to $50 million
- A 50% accelerated depreciation deduction.
- A 50% wage subsidy for apprentices
- A one-off stimulus payment of $750 for people receiving benefit payments.
- A regional and community support fund.
4. Study your supply chains
Does your business rely on China for products or parts? If so, it’s time to explore other options and look for alternative suppliers. You might be able to support other local small businesses by shifting to a local supplier.
5. Review your cash flow budget and business model:
Consider the following areas and review: - Product/service development - Supply chain audit and improvement - Strategic planning - Refinancing
6. Tax payment problems
The ATO is more open to tax debt deferment requests from taxpayers who have their tax returns and Business Activity Statements up to date and can articulate how and when tax payments are likely to get back on track. Trying to avoid the issue and hoping it will go away isn’t the best strategy when dealing with the ATO. Your accountant or tax advisor can provide further information and support with this.
7. Seek professional advice from your accountant
Remember you are not alone. Your accountant is available to support you through this time and can help with many areas of your business including: - Help you to grow your business and ways to potentially diversify your offerings - Save you time - Avoid penalties - Reduce your stress - Keep you focused on key strategies in your business - Help you to plan for the future and develop exit strategies