Blackburn Accounting

Business

More specifically, what is the post-COVID New World Order of Doing Business and How do we Prepare for it!

Simply put, the world has changed! It’s a new world economy and how we do business has changed!

COVID brought about changed conditions, unforeseen factors and influences that affected what is and how we do Business. Stalled supplies, isolation and restrictions, production, labour shortages, the Ukraine conflict, and inflationary pressures were some of the compounding setbacks.
Adaptability, flexibility and creativity kept many small Businesses alive! Some enjoyed increased demand with the opportunity to explore new ways of doing things, discovering new products and thinking differently. Looking outside the box!
Post COVID, in Australia how we live and conduct our Business has changed bringing with it the emergence of entrepreneurship opportunities, optimism and resilience not seen in the past 50 years!

With the rapidness of change trends are emerging; technological, cultural and societal. Smart Businesses are preparing by accepting change is inevitable! They see change as opening doors and view challenges as opportunities.

Areas of change include: Technology, Workplace & Work practices and ECommerce.
Key Challenges: identifying growth Industries, making new trading alliances and securing safe Supply chains.

Technology: is redefining the way we do Business. Digital transformation incorporates computerised technologies into their business processes, products, structures and systems thus providing more streamlined operations and ensuring Business continuity. Businesses that undertake digital transformation are better equipped to engage and respond to their customers and workforce needs and further increase their market competitiveness.

The Workplace: the definition of workplace has, will change as we see different working patterns and habits adopted, including around remote working practices. As new norms are established the workplace will no longer be an office, a place of daily attendance. Workplaces, whatever their description will be a collaboration, concerned with achieving common objectives.

Remote Working practices: Employees doing their jobs from home or locations away from the traditional central office place. Offering ‘remote’ flexible arrangements is the new norm for attracting employee engagement and retention. Conducting business this way requires implementing virtual team collaboration and setting up remote business operations to suit all parties.

Empty Pocket

Most Small Businesses will experience ‘cashflow challenges’ those times when the sea of money seems to be adrift, with more money going out of the Business than there is cash coming in!

If this sounds familiar you are not alone with ‘92% of Australian small Businesses experiencing negative cashflow with owners struggling to pay essential costs such as rent and wages’ (Insight report July 2022). This is financial pressure small Business doesn’t need!

The good news is that there are ways to help stay afloat! With foresight and adopting sound financial management strategies some common mistakes can be avoided and obstacles overcome.

Here are some common challenges with our Top Tips to help you overcome them!

Profit margins: Particularly relevant in the current inflationary spiraling pricing cycle, it’s critical to have true-cost pricing. Don’t let your profit margins be eaten away by increasing costs.

Tip: Regularly check the cost of goods and products and determine realistic profit margins by setting prices not too low or too high. Pricing points are needed to keep you competitive and in the red. Offer value for money and your customers will keep coming back!

Overdue payments: monies due to you: Slow and late payments pose the greatest risk to small Business. Cash in keeps the money flow flowing, without it the cash river dries up!

Tip: Have an efficient invoicing and billing system in place, one that generates accounts at point of sale and offers various payment methods. Electronic systems can also monitor receipts and overdue accounts allowing you to better manage and avoid late payments. Keep on top of your debtors ledger, remember you are running a Business.

Personal and Business financial matters: Mixing money, personal and Company transactions is fraught with danger, including relationship friction and can easily lead to ‘robbing Peter to pay Paul’!

Tip: Keep separate systems and records and avoid ‘borrowing’ from either. Makes it simpler for all concerned including for providing true and accurate Business financial reports, taxes and audits.

Recruiting staff has never been more challenging and on the other side of the pandemic smart small Businesses are doing it smarter by adopting a more strategic approach to this task. Rather than ad-hoc and piecemeal, the process is now more refined and organised. This framework has developed shaping the strategies for attracting and recruiting the best talent.

Recruitment Strategies for small Business include:

Social media opportunities: Post on all platforms. Facebook, Instagram, LinkedIn, these are the super highways of communication. Put the word out you are hiring, looking for the ‘right’ people to join and help build your successful enterprise.
Sell your Brand & Culture: in all mediums, promote, show and tell what your Business is all about. Be the messenger, the story teller sharing the values, vision and what makes it great place to work in. Your job descriptions should reflect this professional and positive culture, making it attractive to applicants.

Small Businesses built on the strengths of personal relationships, smaller teams and approachability, are the unique features supporting a more authentic and responsive environment. It is these very strengths that allow the business to be robust and flexible this equips them to face the many challenges of running a small Business. Challenges such as with the current labour market shortage, recruiting staff, and managing business through the COVID period. To be in the race, including competing with the big players, Small Business has to work smarter by adopting Recruiting Tips & Tricks.

6 Recruitment Tips & Tricks:

Online opportunities: maximise digital platform exposure! Make the most of your recruiting efforts by posting on multiple sites with targeted messaging. Include various products, such as videos, podcasts and blogs. The web is your oyster!
Involve your Team: your Team is also the face and voice of the Company. Encourage they share ‘hiring’ opportunities with their networks.
Use contacts and connections: reach-out to your circles to increase your pool of potential candidates.
Read more …

Travel to work

It's a hot topic of conversation at tax time and the question most frequently asked is, 'can I claim a tax deduction if I drive my car to work'!

The answer lies in the detail as there are various scenarios and complexities to claiming. Along with a changed workplace environment as more taxpayers work remotely and from home which bring into play different tax rules. It's therefore not surprising to find Taxpayers can get their claims wrong.

Yes, you can claim in some circumstances.

If your travel was partly for work and partly private, it is the general rule that you can only claim for the part related to your work.
If you use your car or motor vehicle for work-related travel, where you use it in undertaking your work-related duties, other than your trip to and from work, you can claim a deduction.
If your home was a base of employment. that is, you started your work at home and travelled to a workplace to continue your work for the same employer. These rules can be 'tricky!'

You can find out more by visiting the ATO website

Or speak with Blackburn Accounting to help you with your claim.

Eligibility to claim: How you work out your deduction will depend on if you are using,