One of my favourite local restaurants is run by a man who is ever smiling and always helpful. I had a meal there a few nights ago, and asked if his family-run business had picked up since the COVID pandemic seemed to be – at last – under some sort of control. I was surprised when he actually paled, and said things hadn’t picked up as quickly as he hoped. Bookings were still down and customers were few and far between. He couldn’t re-employ most of his staff and was struggling to pay his suppliers. I vowed to myself to go to his restaurant more regularly and support him and as many other small businesses as I could.
We all know that these businesses play a significant role in the Australian economy, and account for almost half of the employment in the private non-financial sector. But because of their very nature, they tend to have lower survival rates then large firms.
Statistics show that more than a third of Aussie businesses found it difficult to meet financial commitments last year – and, since then, they have faced lockdowns, diminishing government subsidies and staff shortages. It’s clear that my local restaurateur – and many other mum-and-dad small businesses – need a lot of help to get back on their feet, especially with the end of Job Keeper and other Federal Government subsidies looming in just a few short weeks.
This is a view which is thankfully supported by many in our community. One of Australia’s leading liquidators, Brendan Nixon, from SM Solvency Accountants, says now is the time to help small businesses move forward, describing them as the backbone of our economy.
“We need to do everything we can to help them,” he says.
To that end, Nixon, and other small business experts, notably Geof Alexander, a senior director at ZIP Co, and Strategic Solutions’ Managing Director Cheryl Stainsby, have volunteered to speak at a free webinar at noon on Wednesday 3 March, where they will offer advice on how small businesses can get back on their feet. Alexander doesn’t mince his words when he says small businesses have been “smashed by COVID”.
“This webinar is an important forum in understanding what has happened, the issues we need to confront and how we can work together to support our SMEs to right themselves and keep growing,” he says.
Apart from the financial side, the emotional impact of seeing staff leave and profits dramatically dwindle should not be underestimated. Stainsby says she has recently dealt with many small businesses and knows they need a lot of support.
“Many are unsure of their rights and need independent advice so they can decide whether to move forward or liquidate,” she says.
“Struggling small-businesses owners should prepare cashflow forecasts as a defence to any future insolvent trading claims,” Nixon adds. “This is difficult to do with the constant threat of lockdowns, but if possible, a solid step towards staying viable.”
So, next time you head to the shops, think about your local small-business operator – whether they are a restaurateur, a nail salon or florist – as it is up to us, as a community, to help Australia get back on its feet.
Jeni O’Dowd, Senior Advisor, AC Agency