In June, we asked you to complete a survey to help us better understand how you feel about your business in the current economy. The survey results shed light on some of the primary concerns facing business owners right now. According to our survey, the key issues facing our survey respondents right now are:

• Regulatory Changes: Many businesses are finding it difficult to keep up with evolving regulations.
• Customer Demand: Fluctuations or a lack of customer demand causing uncertainty.

The survey revealed that several business owners have had to make major adjustments to their operations to stay afloat, with some considering selling their businesses but felt the market conditions were not favourable. Others were considering deregistering from GST to reduce their tax burden or were focused on maintaining their operations and expanding their product or service. In May, respondents felt the government tax relief was not enough to address broader financial challenges. 

Tips for Alleviating Financial Stress

How can you lessen the challenges of cash flow management, so it doesn’t end up taking a physical and emotional toll in the current economy? Here are our top tips for alleviating financial stress. 

#1. Have a written budget. 

Make sure you have a detailed budget or cash flow forecast, something that is easy to follow and review each month to make sure you are on track. Most business owners know how much their expenses are each month in their heads but don’t keep track of actual costs against what was forecast.   

#2. Know your reserves. 

Know what reserves you have available if they are needed. For example, do you have an overdraft in place should you need it? Do you have a good relationship with your bank should you need extra financing? Do you have surplus funds in your bank accounts? Do you have assets that could be sold if not needed to release some cash? Are you carrying too much stock? Unexpected expenses can occur suddenly. Ensuring you have reserves available can be your business’s financial insurance policy. 

#3. Review your pricing. 

Review your pricing, and how much you are charging your customers. Are you charging enough? Increasing your price annually by small amounts to align with inflation is better for your customer than a large price hike when you realise you are no longer meeting your margins. 

#4. Review your expenses. 

Have you considered the increased cost of living, the rising cost of buying goods, the increased cost of labour, higher import costs, etc? Review your expenses. Can you negotiate a better deal? 

#5. Address your debt. 

Taking on debt can be part of running a business, however, failing to meet your repayments or accumulating debt can lead to the unfortunate possibility of business closure. Address your debt if you have any. Make sure you have an agreed payment plan in place that you can afford. 

A good accountant is more than just a bookkeeper, we can help you develop a business plan, provide advice on how to grow your business and or where you can tighten your belt.

Thanks to everyone who filled in our survey. Your insights help to keep us informed about the needs of businesses in the current economy. If you are feeling overwhelmed, get in touch.