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Why a good cash flow can be more important than a big profit

 

There's a saying in business, "You can go broke making a profit." And another, "Cash is king. Profit is theory." 

As you know only too well, you don't pay rent, meet payroll or pay your bills with profit.

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What you need to know before starting a business

Starting a business is part science, part art, and a large part hard work! It can get lost in all the excitement but you need to get the balance right.

Approximately 20 percent of all small businesses fail in their first year; and your chances of your business making it to five years are around 50/50. 

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Two things first up: (1) If you want to (or have to) work past the age of 55, you need to read this article; or (2) If you know someone else who that applies to, please forward them this article or a link to it.

They'll thank you for it.

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New family and domestic violence leave entitlement

New family and domestic violence leave entitlement

Family and domestic violence leave has been added to the National Employment Standards and applies to all employees in the Fair Work System from today.

The new entitlement allows employees experiencing family and domestic violence to access up to 5 days of unpaid leave to do something to deal with its impacts.

This includes (but isn't limited to) taking time off to:

·  make arrangements for personal safety, or the safety of a family member

·  attend court hearings

·  access police services.

Find out more

You can read more about the family and domestic violence leave changes on our website.

Confidential information, counselling and support for people impacted by domestic and family violence is available at www.1800respect.org.au 

Complete Business Strategies strive to provide innovative solutions to legally minimise the tax payable on our clients' hard earned income. If you require more information on any of these topics give our office a call on 5439 1600 and speak to one of our qualified experts.

Managing your business cashflow over the holiday period

                                                                                                                                                                         

 Managing your business cash flow over the holiday period

 

December is usually the busiest time of the year for retail and hospitality businesses. But businesses in other sectors often find that their sales slowdown and their customers stop paying them for a few months. So cash flow dries up.

Whether your business is large or small, well-established or in start-up mode, you need to take a planned approach to managing cashflow during the holiday season. Here are few tips for keeping on top of cashflow management during the Christmas/New Year holiday period.

1. KEEP INVOICING IN THE LEAD UP TO CHRISTMAS

Don't let your business admin slip in the rushed lead-up to Christmas. This is the most important time of the year to stay on top of your invoicing. You may find that many customers will be slow to pay because their businesses are closed over the Christmas period.

2. SET CLEAR EXPECTATIONS WITH YOUR CUSTOMERS

Be clear with your customers that you expect them to pay within the pre-arranged credit terms over the Christmas period. Phone regular slow payers a few days before payment is due to confirm that they'll be paying on time. The phone is always a more effective method than email. If you're not comfortable having this conversation with your customers, your accountant or bookkeeper may be able to assist.

3. SERVICE BUSINESS – OFFER A DISCOUNT FOR THE "QUIET TIME"

If your business is usually quiet in January, why not offer your clients a 10% discount if they book you in for January? Why not offer them a 15% discount if they also refer a neighbour or a friend? Set whatever discount amounts work for you. This is the thing: A strategy like this will keep your business busy and some cash coming through during the usually quiet period.

4. USE THE QUIET TIME TO WORK ON YOUR BUSINESS

If sales are a little slow in the lead-up to Christmas, use the time wisely to hit the ground running in the new year.

The pre-Christmas slowdown is a great time to work through the to-do list you've been compiling all year. This might include taking a thorough inventory, searching for more suitable lending alternatives, completing a comprehensive competitor analysis or researching the market for new products and suppliers.

WANT TO TALK?

Feel free to contact our office anytime by phone or email – We can't wait to provide you with better advice now for a beautiful future!

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