Running a small business in Australia is challenging as business owners are saddled with high costs, excessive red tape including compliance. Currently the economy is sluggish with warnings signs on the horizon. Therefore, I wish to share some tips that will prepare you for a downturn and help your survive. These tips can be used in good and bad times.
The following are 10 tips to help you and your small business through difficult times.
- Tips 1 – do not sack staff
- Tip 2 – do not cut back on marketing
- Tip 3 – review your cash flow
- Tip 4 – do not overstock
- Tip 5 – ensure you are paid on time (implement systems to reduce late payments)
- Tip 6 – apply the lean method
- Tip 7 – customer relationship
- Tip 8 – excellent customer service
- Tip 9 – ensure you are compliant
- Tip 10 – take care of your health.
When a downturn occurs the first thing governments and businesses do is to reduce staff. What is required is increasing sales. Reducing your marketing budget and sacking staff does not increase sales and in fact may make your business retract further.
As we all know cash is king. You need to understand what is cash flow and be very strict with your finances. This means ensuring your invoices are paid on time, not overspending on stock as this adds to costs in a number of areas.
Also ensure you don’t get behind if you owe the tax man and ensure your staff are paid correctly and on time (Single Touch Pay Systems have to be in place by 30 September). Failure to comply can be a costly exercise and in fact destroy your small business.
Shop around for a better deal for your essential services such as energy and telcos.
An important area that is overlooked is customer service. We are not very good at this in Australia. I would hate to say how many times I have walked into a shop and walked out again due to a could not care less attitude by owners and staff in shops. No small business owner can afford to lose one client.
You also need to keep in touch and on good terms with your suppliers. If you have difficulty in paying do not wait until the last moment to tell them but have a talk and try and work out a payment plan.
Last but not least look after your health. This can be mental and/or physical. If your health is in poor condition, it affects your relationships with your family, staff and your small business.
Please feel free to contact Small Business Association of Australia anytime if you wish to discuss issues regarding your small business.
Written by Anne Nalder, CEO and Founder of Small Business Association of Australia.