Currently, times are really tough. We get it. But in time, things will change. In this article we discuss the lifelines being thrown to businesses by the Australian Government and ways you could use them to keep your staff employed and to transform your business ready for the turnaround.
1. Grab the cash
The Government is throwing lifelines to businesses, so make sure you catch yours. First, though, engage your accountants and tax advisors. As most of these lifelines are being delivered through the tax system, it’s a good idea to get a quality tax agent on your side to guide you through the process.
Australian Government and ATO lifelines (current at the time of writing):
- Wage subsidies
- Job keeper entitlements
- BAS and IAS deferments
- PAYG Income tax refunds
- Payroll tax relief
- Tax deferrals
- Capital investment
- Instant asset write-offs
Additionally, the Government is making debt funding available through the banking system. Abbotts can guide you through this process and help you to establish business plans to increase your capacity to borrow for the future.
Further cash flow relief initiatives, such as rent relief and commercial tenancy assistance, are being announced on an almost daily basis. Many of these initiatives provide financial assistance in the form of tax relief accessible by application and some of which will be automatically applied to eligible businesses. For more information go to the Australian Taxation Office Small Business Newsroom and Australian Government Treasury.
These lifelines could help to keep your workforce connected and actively involved in your business now, so that you can keep your staff on and be ready to resume regular trading once things get back to normal.
2. Find new revenues
Perhaps you could look for creative ways to find new revenue streams. If you understand gross profit margins, you will know that new revenue is two to three times more powerful than reduced costs. Maybe focus on revenue streams first and costs second.
We’ve been seeing hospitality venues come up with loads of great ideas to keep trading in these COVID-19 testing times. Gift cards, merchandise, fresh meal kits, frozen meals and online cookbooks are just a few ideas, but there are many more out there just waiting to be discovered. Perhaps you could offer online cooking tutorials to your customers enduring self-isolation and when you reopen, invite them back to your venue to discuss their cooking exploits.
3. Emerge with a better business
The Government is prepared to fund your business with the following initiatives so why not use these funds to transform your venue into the successful business it was always destined to be?
Labour at $750 Per Week Per Employee
Why not use this lifeline to get your staff in and improve your business in preparation for your return to trading? You could get that cleaning done, train your staff to be POS experts, stocktake every last item, develop better business practices, or plan and program your menus for the rest of the year. There are so many things your staff could be getting on with to improve your business while the government pays their wages.
You could use this funding to improve the capital value of your business by eliminating its weaknesses and enhancing its strengths. The government is offering $100,000 to every eligible business from just one incentive package alone, to provide support through the crisis. This is a tax-free payment that you can reinvest in your business as a tax deduction to improve your venue, systems and staff skills.
If you can borrow under the new lending rules, you could look at ways to invest in your business model so you emerge, post COVID-19, as the hospitality venue of choice, ahead of the pack and set up to function at optimal capacity. You could invest in better and more efficient equipment, refurbish your venue or even open new outlets in locations where some businesses may not re-emerge. These loans are low, interest-only loans of up to three years and require no guarantees or security, just a viable business case.
If you have any questions about the information above please contact the team at Abbotts, we will be happy to assist you. You can find details to get in touch with us on our contact us page.