Man Connects Two Puzzles Providing Financial Support To Business
Credit: Man connects two puzzles providing financial support to business in a crisis situation. Government assistance in overcoming the effects of the pandemic. Preferential cheap soft loans, tax breaks.
The disruption caused by COVID-19 has caused SMEs to re-examine their business models, processes, and opportunities to find a way to survive the immediate threat and thrive in the long term. Government investment announcements have come as a welcome lifeline to many businesses whose turnover has been affected by the challenging economic landscape.
However, rather than viewing government incentives as a lifeboat, SMEs should look to government spending as a way to solidify already-strong business foundations and drive growth in 2021.
The federal government’s recent budget was filled with tax incentives and wage subsidies, boosting confidence for SMEs. This gives businesses the chance to invest now in solutions that will help them improve internal processes so they become more agile, resilient and ready for the next market challenge.
There are three ways businesses can survive and even grow in the current uncertain landscape.
1. Boost cashflow
Cashflow is everything for SMEs and most don’t have the extensive resources that would allow ongoing viability if cashflow were cut off or dramatically reduced for an extended period. Cutting unnecessary costs and driving process efficiencies can help SMEs preserve and even boost their cashflow. This requires real-time visibility into company spending and the ability to analyse data to identify trends, such as which suppliers are most reliable and cost-effective. Decision-makers can use this information to determine which suppliers to do business with and where the opportunities for cost savings may be.
2. Become agile and scalable
Being able to adapt to market changes requires a business model that is agile and scalable. Business decision-makers require access to real-time financial information to help them make the right strategic choices. Many SMEs remain mired in manual, paper-based processes that prevent agility and scalability. These organisations should consider implementing automated solutions that help provide a more comprehensive view of the business’s financial position, including spending. These solutions can reduce the burden of manual work, mitigate the risk of costly errors, and free up staff members to focus on growth-generating activities instead of administrative tasks.
3. Develop a collaborative and innovative culture
Businesses that continue to operate the same way they always have may struggle to thrive in the new landscape created by COVID-19. Instead, they should develop a collaborative and innovative culture that will let them leverage the brains trust of the business to identify and pursue new opportunities. This will prevent the business from becoming stuck in a marketplace where it can no longer compete, and allow it to become disruptive and competitive in new ways.
SMEs must ensure they’re positioning their business for long-term success. Putting automated solutions in place that provide increased visibility and control over business spending can play a key role in helping businesses manage their cashflow more effectively, become more agile and scalable, and collaborate and innovate for ongoing viability.
Fabian Calle, Managing Director – SMB, SAP Concur ANZ