"Cashflow is key to a small business’ success, and it’s vital to find the right way to manage your business to ensure it. Most businesses fail because they don’t have enough cash to keep their operations and dreams alive. It is critical to have a business plan and, within that, some cashflow calculations.
It doesn’t have to be complicated, just enough so you know what’s happening. If you have a good plan and manage your cashflow well, it helps you through those difficult times when cash is tight.
Here are my top tips on how to get the numbers right in your small business.
1. Understand the balance sheet and the profit and loss statement
It’s vital that anyone operating as a sole trader or running a small business understands the numbers that are the foundation of the business – and if they don’t, invest in advice from a good accountant. It’s important to understand the balance sheet and the profit and loss statement. If you get the figures right it allows you to deliver on the strategy of your business.
2. Accounting software / bookkeeper
I am a firm believer in having tax returns prepared by an accountant, but says any small-business owner should be able to do their own books, either manually or using a software package like Xero.
Some people may choose to invest in professional services from the start, but I suggest that a good line in the sand is when the business is turning over around $200,000 a year.
Ask the accountant you want to work with if they can help you strategically, can they give you good advice on how to structure your business, and how to manage your cashflow and reporting obligations.
One obvious part of doing the books is the issue of wages. We chose not to pay ourselves for several years, preferring to invest in the business, but we were well prepared for that, and it is important to plan appropriately. You need to ask yourself, “Can I live leanly for a couple of years while I get my business off the ground?”
4. Cashflow management
Not understanding cashflow management is one of the biggest mistakes small-business owners make.
Managing your accounts always comes down to managing your cash. Get comfortable using a spreadsheet. You don’t need to be an expert; you just need to be able to put your months down, your expected sales numbers, your expected costs.
5. Understanding tax
In terms of tax – how much you should be paying, and what you can claim –talk to your accountant and/or check with the ATO website, and other government business websites (i.e in Victoria, www.business.vic.gov.au). Always rely on reputable sites.
Remember…you should not resent paying tax, because if you are earning enough to pay it, it means you are successful!?"
Welcome to the Collab Zone Network - the brand new feature on the community for business owners! From today, you can actively choose to connect with members on the community by filling in three simple criteria on the Network section.
Connect with industry partners and other business owners to collaborate and network with peers using the Network functionality.
Now, we know how exciting it can be to connect with those who understand your journey, so with all things new, there is a bit of set up required.
Set yourself up for Networking
The Collab Zone Network feature is only available to registered Collab Zone members
If you're new to the community, you will need to register on the community and complete the next steps
Since the Network functionality runs and depends on completed profiles, please fill in the 'Your Profile' section in your homepage when you log on to the community
Look for the 100% complete notification that will appear under 'Your Profile'
Once completed, navigate to the Network tab and input the details of a community member you want to connect with
If you don’t find who you’re looking for, you can see the list of member profiles below the search box
And the best part? As the community grows, there is potential to connect with more members. You can use the network functionality multiple times
Network online with registered Collab Zone members in three simple steps
Most business owners receive plenty of well-intentioned advice and ‘helpful opinion’ from family and friends. However, good business advice spoken from commercial experience is another matter entirely.
That’s not to say it’s hard to find, but finding a reputable source is sometimes less than straightforward – especially if you have specific problem to solve and time is limited. This is why, for good times or bad, developing a network of peers or seeking out a business mentor can be a great idea.
There are many sources of help available, including government agencies, financial institutions, business associations and non-profit organisations.
It may be worth your while to explore the grants and assistance listed on business.gov.au. You can also search to find what’s available in your industry.
There are also a number of state grants and subsidies available throughout Australia, including:
Tasmanian Technopark – assistance is provided by the Department of State Growth in Tasmania which aims to develop, support and market technology and innovation-based businesses.
Small Business Bus – in Victoria, the Small Business Bus, a mobile mentoring program that comes to you, offers free business mentoring for those starting up. This free business mentoring program is available to all business owners and those who intend to start a business in its service area. The bus stops in Melbourne and regional Victoria.
Austrade provides a comprehensivemix of information and customised servicesto help you do business with overseas markets and to understand foreign regulations and business practices. Be prepared though that there aren’t many government grants to help you start your business, but there are other loans and support available.
These are intended for aspiring and current export businesses. Austrade administers this financial assistance program. It’s designed to encourage Australian start-ups and established businesses to develop export markets and provides exporters who are aiming to increase their international sales with reimbursements of up to 50% of promotional expenses. Promotional expenses must be over $15,000 to a maximum of $150,000.
Provides businesses with access to expert advice and matched funding of up to $1 million to cover eligible commercialisation costs to help them to take novel products, processes and services to market.
Find training, advice, and funding to create a healthy and safe workplace for your business.
Business Development and Assistance Program
Indigenous Business Australia’s Business Development and Assistance Program is targeted at indigenous Australians. It offers support, training, funding and loans to indigenous entrepreneurs looking to start up new businesses.
New Enterprise Scheme
The New Enterprise Incentive Scheme (NEIS) provides training and mentoring advice to help unemployed people start up their own businesses. It consists of 21 providers who offer individualised mentoring and support to unemployed individuals interested in becoming self-employed. Not only does NEIS provide up to 52 weeks of small business training and mentoring, it also offers up to 39 weeks of income support and up to 26 weeks of rental assistance to eligible individuals.
Be sure to explore different resources to find what you need to support your business growth at every stage. Ask other business owners for their recommendations as well.
It’s not just money that you need
Money doesn’t solve all your issues, and it’s critical that you also access advice, every step of the way. Before searching for a business mentor or adviser, it’s important to take some time to decide exactly how a mentor could help your business and to define the attributes of your ideal mentor. The better the brief, the better the match.
First of all, decide on what you’d like to achieve by the end of the mentoring process. You may want to:
Develop new products
Identify growth opportunities
Explore offshore markets
Have someone make you accountable to making positive change
Brainstorm a list of the attributes and qualities of the ideal mentor for your business. For example, experience in:
The industry sector with which your business operates. It’s critical to have someone that understands your business’s dynamics.
Setting up, developing and growing a business in the region where you’re based or where you’d like to expand.
Demonstrating proven results where you’d like your business to improve, such as increasing productivity, enhancing financial management, or driving sales forward.
Once you know exactly what kind of help you’re looking for, it’s time to go out and find it. You can do this through a business network or by searching online.
There are a range of services that you can access, and who you choose depends on your own capabilities and type of business. If possible, choose advisors who have several other clients in your industry because they can often pass along that experience to your benefit. Even better if they specialise in your specific business sector.
Accountant. This is your go-to person for advice on major financial decisions, tax filing, tax planning and, eventually, preparing for business succession. While an accountant will charge for their services and advice, it’s a valuable investment. Find an accountant who understands your business.
Lawyer. Your lawyer can set up a company for you, draft a sales agreement to use with customers, review your website for legal issues, create contracts for your employees and help you to protect your intellectual property.
Business advisors and coaches. A business advisor is someone who will answer general business questions for you. A business coach will work with you to set business goals and encourage you to achieve them. Ask others in your industry for a recommendation.
Industry groups. You may want to join an association that represents your industry to stay on top of industry news and regulations, and to connect with your peers. Industry groups also provide professional development and learning opportunities for members.
Chamber of Commerce. Generally of the most well-established and respected business associations around, your local Chamber will host business networking events, seminars, workshops, award dinners and other activities designed to help business owners learn and connect with each other. Find your local Chamber to explore membership.
Consultants. These are typically category-specific advisors brought in to help you address a challenge – such as branding your business.
Spend some time online to research all resources relevant to your business and check out local business organisations and services available to help your new enterprise thrive in the region – you can visit your economic development office for details. Plus, you’ll find trusted business publications to be an excellent source of growth strategies, business tips and inspiration.
Business mentoring can give you a fresh perspective and bring new ideas to the table of your own business. It can propel your business into profitable areas that you didn’t consider before, while also giving you the assistance you need to push through tough periods.
The Morrison government has delivered its election pitch to small business in the form of the 2019-20 federal budget tonight, quantifying a raft of previously announced policies and committing $525 billion to an overhaul of vocational training.
But in its biggest SME-focused measure of the night, anotherextension of the instant asset write-off,Treasurer Josh Frydenberg is left with two yet-to-be-legislated tax reforms and little time before the 45th parliament expires.
Below are Alec's top 9 tips on growing a business online
In 2008, I founded and launched a website (DesignCrowd.com) with a laptop, $10,000 in savings and 3 credit cards (including an ANZ credit card).
Today, DesignCrowd is a leading global design service for small businesses and is approaching $20 million in revenue per year with customers in more than 100 countries and over 500,000 designers from around the world. Recently, we launched a second websiteBrandCrowd- an online design maker tool for small businesses - which is doubling in size each month.
While we started our business in Sydney, we always wanted it to be global. Since we launched, we have received over $12 million venture capital funding to help us scale the business internationally and today 85% of our revenues coming from outside of Australia.
Through the process of scaling DesignCrowd globally over the years, I've made plenty of mistakes but I've also learned plenty about growing a business online which I've tried to summarise in the blog below.
Here are my9 tips on how to grow your business online...
1. Think big
When it comes to planning the launch or growth of your business, bigger is better. The bigger the market, the more opportunity for growth and as Steve Jobs said “We're here to put a dent in the universe.” Think Australia-wide, think global and go for it.
2. Understand your market
Before diving in, it's really important to understand the market. What do your potential customers want? What are other businesses offering online and what is working well for them?
Research what people are searching for online. Understand which products, services or phrases people are typing into Google (using a tool likeGoogle trends).
3. Offer something awesome
Whether you're an ice cream shop or an ecommerce startup - the most important ingredient for online growth is to have an amazing product and constantly improve it.
If you have something great to offer, your business is going to grow AND it will grow faster and more easily than something that everyone else is offering.
4. Invest in great design
How your website looks and works is essential to maximizing growth.
Once your business or website is launched, you need to try to improve things constantly.
Whether it's your advertising or your website design or your prices - you need to be constantly testing and measuring the results.
Never stop testing, and your business will never stop growing.
6. Google is king
Most businesses trying to grow online are going to need to find customers through Google. Google is still king. Consider running ads on Google (at least test it to see if it will work for you) and make sure your website is SEO-friendly. You might also consider writing some blog posts that could help attract visitors to your website.
7. Word of mouth is key
If Google is king, then word of mouth is queen.
Work on improving your product and service and delighting your customers. Consider adding features that encourage a 'viral loop' or getting your customers to share their experience with their friends and colleagues.
8. Measure Everything
The following two things are true: 1) it is hard to improve something you're not measuring and 2) anything that is measured and watched will improve.
A beautiful aspect of online businesses is the amount of data you can get your hands on. Traffic, click through rate, conversion rate, leads, sales, average order value, revenue and so on. Figure out what your important metrics are and measure them.
9. Start immediately
Before you grow online you have to start! Get a domain name, get a logo, get a website, write a business plan, create a Facebook page - JUST GET STARTED. Taking action is the first step to turning your idea into a real business.
Aussie-owned Four Pillars Gin is eyeing the top of the world’s gin market and will double down on international expansion in the coming years after selling 50% of its business to multi-national drinks giant Lion.
Aussie hardware giant Bunnings has finally announced plans to enter the online shopping game after years of speculation and anticipation.
The retailer took the wraps off its plans yesterday in a presentation and call with shareholders, with managing director Mike Schneider revealing that after a trial in Tasmania next month, Bunnings’ online store will be rolled out across the whole of Australia over the next 18 months.
Looking back on his storied 40 years in business, David Penman reflects the most striking thing that springs to mind are the number of “dumb things” he did.
The 66-year-old is probably better known to Australians as ‘Jim’, the man behind the wildly successful and multi-pronged Jim’s Group franchise, which today includes Jim’s Roller Doors, Jim’s Personal Training, and — of course — Jim’s Mowing.
Australian fashion startup and former industry trailblazer Shoes of Prey has collapsed into liquidation, ending months of uncertainty surrounding the startup after it was put on “pause” in August last year.
Employers found to have engaged in serious and deliberate underpayment of migrant workers could face jail under a crackdown signaled by the government to introduce criminal penalties into the Fair Work Act.
Business owners who built e-commerce websites through platform provider Neto claim they’re being “gouged” by a sudden change in its pricing structure that will leave them thousands of dollars a year worse off.
Australian food icon Maggie Beer has sold the final half of her eponymous gourmet products business to ASX-listed food and beverage group Longtable in a deal which marks the end of an era for the much-loved brand.
In a landmark ruling, the Federal Circuit Court has handed down $329,113 in penalties against online fashion retailer Her Fashion Box and sole director Kath Purkis for underpaying an intern and two other workers.
After a week of Twitter scuffles with the US Securities and Exchange Commission, Elon Musk has announced the launch of the long-awaited Tesla Model 3, and the closure of all of the manufacturer’s physical stores.
In an ideal world combating cyber crime in business would be a multi-disciplinary in-depth approach, with security built into technology and staff enabled - and empowered - to detect and respond to where technology can’t.
Cyber security can be perceived as being too hard to manage and a drain on people’s time. There can be a general perception cyber incidents only happen to ‘someone else, not me’ or are someone else’s responsibility - which leads to complacency.
With the right approach a business’ people can be its biggest asset in the battle against cyber crime. The problem is many still don’t understand how cyber security is relevant to them or what they need to do to reduce the threat.