Small Business Post-JobKeeper - Apocalypse or Opportunity?

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Listen in as I talk about the end of JobKeeper payments and what small business owners need to be aware of as they navigate the next 12 months—all these and more in this episode of Get to the Contest Small Business Podcast.
Here are some key takeaways from this episode.
Covid 19 brought many challenges and changes. The Federal Government offered a number of initiatives to help small businesses. These included:

• The cash boost
• JobKeeper wages reimbursement
• Changes to rules around insolvent trading – protecting directors somewhat.
• Virtually turned off all Debt recovery & penalties – More than 5000 staff reassigned from Debt to JobKeeper.
• Other assistance around delaying the payment of commercial debt.
• Changes to asset depreciation laws allowing instant right off.

Check out this PDF File: http://bit.ly/JobKeeperPDF
Impact of the Government Initiatives on Small Businesses

• Confidence
• Zombie Business kept alive until March 31.
• Major Decrease in small business liquidations
• Unemployment peaked July 2020 at 7.6% but dropped and was 5.8% as at Feb 2021.
• Demand has spiked for plant & equipment.

Once JobKeeper ends, what’s next?

• ATO to turn on the recover switch of the 53 Billion Dollar book of debt
• Insolvency’s will go up – Keep an eye out for the notices .Don’t ignore
• Many voluntary liquidations will take place, now that the free cash has stopped.
• Commercial debt and other supplier payments will now need to be repaid.
• Above hasn’t impacted consumer confidence.

What should you do?

• Don’t ignore ATO correspondence. Director Penalty notices can be very time dependent.
• Get numbers up to date
• Get lodgements done – even if you can’t pay
• Ask for ATO repayment plans now – get on the front foot; you should be able to get over 24 months.
• Supplier terms – lock in NOW
• Have a budget & cash flow
• Go hard on debt collections NOW. Before people are too far removed from the free money
• Have funding approved – Even if you don’t need it. Banks are ridiculously busy. As are alternate funding providers assisting SME’s with products like trade finance.
• New clients – Do a credit check. Make sure they haven’t been cut off. Put them on a limit.

Are there any opportunities through this pandemic?
Every Boom Bust has the impact of cleaning out industries. Those that were weak die off, leaving those that were left to thrive. Covid 19 will be like the GFC on Steroids.

There will be a lot of opportunity such as—there’s never a better time to sell 2nd hand equipment than now. Limits to supply from Overseas, Depreciation Policy changes and low interest rates are driving the demand. This is great – provided you aren’t also stuck sourcing a replacement asset.

With other businesses folding, this is also an opportunity for you to recruit a valuable team or workforce for your business.

Also, strategically purchasing struggling business for a nominal cost could add significant dollars to the bottom line. Clean up your own balance sheet if you can. Keeping your numbers up to date will make for an easy review of your finances and help you not miss out on business opportunities.

Feel free to email me at [email protected] for questions and further inquiries.