With analysts predicting a challenging year for some SMEs, it pays to stay on your toes when it comes to business planning and cash flow. How well you manage the books can be the difference between a successful operation and one that struggles.
Our advisers help business owners navigate the environment and to find ways to maximise profits and reduce risk every day.
Here are some of their top tips for those operating (or starting up a business) in 2023.

Cashflow is important

This is the biggest issue for business owners in 2023. With many still trying to recover from the COVID-19 downturn, getting back on your feet and staying there is crucial. This means keeping a close eye on earnings each month and outgoings. While some businesses appear to be doing well, if they do not have a grasp on the monthly balance sheet, and if ongoing expenses are not managed adequately, it can spell trouble. It is better to run a business with an eye on the financials each month rather than taking out new loans to cover upcoming costs– especially in this market. These days there are many software packages that can take a bird’s eye view of your operations and will help to take the pressure off. They can analyse the break- even point so you know exactly how your business is performing. You will feel better about expansion plans or capital investments if you know just how much you are making at any given time. Ask your dmca accountant for details.

Understand PAYG tax obligations

Recently the ATO has issued a warning to smaller businesses and sole traders to understand the pay as you go instalments and quarterly BAS payment system. You need to make sure you factor tax obligations into your ongoing financials and to make sure you are paying enough with each instalment so you are not hit with an extra bill at the end of the financial year. (This could mean possibly facing an interest penalty from the ATO on those outstanding amounts.) Our accountants keep a close eye on these matters, but small business owners should remember to be aware of tax obligations as part of their monthly planning.

Managing your debts

Many small businesses are in debt when they start out. This is common. However, it is important to monitor this debt because you don’t want it to get out of control, especially with higher interest rates and a slowing economy. You need to factor in ways to pay off the debt and how you will manage sustainable growth. If there are concerns or issues to be faced, call us quickly to sort out a solution — or contact the free counselling line Small Business Debt Helpline run by Financial Counselling Australia.

Grants

The government offers a number of grants to SME businesses to help with the rising cost of living. Grants are also available for small businesses to improve their energy efficiency and to improve energy bills. For more information, ask us at your next appointment.