Just in time for the festive season, Victoria and New South Wales have finally begun easing restrictions after extended lockdowns. Bricks-and-mortar stores are opening their doors again and restaurants, cafes and bars are welcoming back patrons.
It’s been almost two years and Australian businesses have been forced to deal with countless lockdowns since the pandemic hit. While some states are close to being fully vaccinated and the ‘new normal’ is changing yet again, how do small businesses feel about the current climate?
Geof Alexander, general manager of Zip Business talks to Aussie small businesses every day about what’s keeping them up at night and their hopes and plans for the future. Here, he shares what those entrepreneurs are thinking right now.
Business confidence continues to fluctuate
It’s been a challenging few months this winter for many Australians, particularly those states that have endured long lockdowns. But beyond that, Aussie businesses in other cities have also been on edge, dealing with surprise snap lockdowns and the fear of further lockdowns looming overhead.
“Last year, New South Wales largely escaped lockdown until recently, then they went down for a few months. Poor old Victorians have had it really rough for a long time, too,” Alexander said.
“I managed to spend a couple of months with my family up in Queensland during the most recent lockdown, and even though the state was open, every business I spoke to was just waiting for a shutdown. Even in those booming economies, their confidence was still impacted.”
Things might be reopening now, but small business owners are still uncertain about their future and how to plan for it. What’s the environment going to look like in 12 months’ time? How do I know my customers are going to keep coming in? Is my store going to stay open? What’s the government going to do next and what will happen to my family around me?
Cashflow is a concern
For many business owners, cashflow is another thing that’s on their mind night right now. It’s been a rollercoaster journey for many. Others have struggled, while others have found a new niche to invest in, like the local bar owner who has switched to selling coffee beans while everyone’s working from home. Some have found a way to make it through by using a combination of government grants, stretching their cash and controlling their spending.
“With such uneven performance, if small business owners go to a bank and ask for funding, it’s hard for a bank to understand what the business’ true financial position is,” Alexander explained. “At Zip, while states have been locked down, we’ll look back at a small business’ performance prior to that period. It’s at the heart of why we launched our product, which is helping businesses to extend their payment terms.”
Thanks to a combination of the pandemic, transport strikes and the skyrocketing rise of online retail, there are major global supply chain issues felt all around the world right now. But while some big businesses were able to order container loads of inventory months ago, many small businesses weren’t able to take that risk or simply didn’t have the space to house all that extra stock.
“Three to six months ago, would you have had the confidence that everything was going to open by Christmas to stock up? Now it’s hard placing orders, getting stock in and out, shipping is hard – every step of the process is a challenge and the supply chain has been impacted,” Alexander said.
Businesses are more cautious, less aspirational
Prior to the pandemic, small-business owners were often hopeful about the future and motivated to take on that next big challenge. But in this new world of uncertainty and rejigging finances and business plans, it’s tougher for entrepreneurs to be as aspirational, according to Alexander.
“That constant opening and closing just has made it impossible for businesses to plan. And so now, they just want to take the next step forward. They want to go into this new world, see what happens, and grow from there.”
Find out more about how Zip is giving back to small businesses as Australian reopens.