Small businesses to self-help – making the most of COVID-19 experience
Much financial aid is available to SMEs to help them survive the COVID-19 crisis, but many are not making the most of it.
True, the record number of Federal, State and local government assistance packages available to them is a complex bundle, difficult to unravel, a daunting challenge but nonetheless vital for business owners to meet and utilise for current survival and maximisation of future prospects.
“Vital” is how Business Australia’s chief customer experience officer Richard Spencer has also described the importance of business owners using available financial help not only to survive, but for the breathing space it gives them to manage essential changes to their businesses.
Where to look for help
All State governments have business websites, and Macks Advisory is surprised to learn how many business owners are failing to make simple online searches that would help them focus on the best available support for their particular business.
Most are availing themselves of JobKeeper payments for workers, they know about JobSeeker but large numbers of them haven’t thoroughly investigated the cash flow boosts, wage subsidies for apprentices and trainees, and bigger tax write-offs for which they may be eligible.
Banks are also presently providing support for individuals and SMEs, and there are city councils setting aside millions of dollars for specific grants.
Now is the time when businesses should be optimising their own websites to accommodate customers changing attitudes and lifestyles, yet obviously many are not doing this.
No doubt it’s why Small Business executive director Bill Lang recently told business owners in a media statement that a proper website and strong online presence were vital for success, and they should seize the moment to ensure their websites were updated to keep in touch efficiently with customers: “The most likely customers you are going to get back are those you had in the past,” he said.
Looking to the future
The generally successful JobKeeper program has worked well so far and there is widespread demand for it to be extended beyond the initial September cut-off time.
But irrespective of what happens about that, business owners should be looking at how best their business can slot into a recovering economy.
What can be done to prepare it for a possible re-emergence of the virus? How best can honesty with staff, working with them to define realities of current and likely challenges, be employed to foster an enduring solidarity?
An immediate and pressing challenge for business owners is to comply with workplace laws, some of which have been changed to enable government assistance to be dispensed quickly.
Between now and the end of the financial year, Federal Treasurer Josh Frydenberg is undertaking a promised review of how well, or not, SMEs are faring in viral chaos, of whether assistance packages should be extended(and if so which ones, and how. Business owners should be using the time to focus on what they should be doing as priorities to help themselves.
Pre March, before COVID-19 hammered it, the economy wasn’t looking at all healthy due in no small measure to many business owners’ failure to move with times where innovation in products and business procedures were becoming increasingly vital for success. Businesses organisations and advisory bodies were telling them this.
Perhaps COVID-19 could be the spur that makes businesses lift their game, an occasion that underlines the reality that while taxpayer funded assistance has limits, business owners’ aspirations for improvement and self-help should have none.
Background for this challenge
Australia’s economy grew just 1.4% in this financial year to the end of March, the slowest growth rate since the GFC, many economists estimating it will shrivel a whopping 8.5% in the June quarter after some 600,000 people lost their jobs in April.
Macks Advisory in noting partial data – including for example ANZ’s most recent spending data – suggests there will be a further drop in productivity.
Yet Australia’s SMEs can take heart from an economy that is envied globally. In the first three months of this year when its economy declined 0.3% China’s shrank 9.8%, France’s was down 5.3%, and the UK slippage was 2%. Australia had since 2017 displaced the Netherlands’ record of having the longest recession-free existence in the developed world.
Now, after 29 recessionless years we’re suffering a phenomenon economists are variously arguing is something between a depression and technical recession – which some are saying isn’t a real recession because it’s not the direct result of a wonky economy like the one former Prime Minister Paul Keating said we “had to have”. Rather is it a state of affairs brought on by a virus.
Even so, household spending was down 3.9% in the first three months of this year and government assistance benefits jumped 6.2% as payments to bushfire-affected communities and the first corona virus were distributed.
However, whether the economy was or wasn’t in significant trouble before the virus, whether or not it’s pushed the economy into a real recession or depression, SME managements should face the reality that in almost three decades there’s never been a more appropriate time for them to have a close look at their own and their business’s performance.
There are the websites of three levels of government, and there are business and industry organisations and associations available to help business owners help themselves.
