Whether JobKeeper will cease or continue for you after September it is important that you take similar steps to avoid a possible crisis when the support stops.   Predictions have been published of 1 in 6 (by Economists) or 1 in 10 (Statistics) businesses closing before December.   You need to look at several key areas in order to survive if not collecting JobKeeper, because being in a business in a recession is made much worse by politics where communication is about power but only one-way, although it is an essential for fostering trust.

1. Collect Debts

If you are owed money you need to collect it.   Don't be aggressive, honey works better than vinegar, but don't ignore a problem.   Perhaps the customer is just strapped, so offer a repayment plan.   Make sure you have the arrangement in writing, such as you confirming it with an email.   If you have   to go to Court after the December moratorium ceases you will need documents to prove your offer or arrangement.   Could you also secure the debt using the Personal Property Securities Register?

2. Remove Waste

Look at your business and your own circumstances.   Compare the Profit & Loss Account for the last two years, what can you cut or reduce?   Often there is waste in goods purchased for resale (there is also a cost in holding excess stock), are production staff efficient and productive, avoid duplicate or ineffective systems and people using your time on FaceBook or personal matters, are you sure your people clearly know what you want them to do, and look at your personal spending and consider if all is really needed.

3. Don't Rely on JobKeeper

Wage costs have been assisted for 6 months and when it stops, what will have to change for you to stay open – reduce staff, drop unprofitable customers, cut your service levels?   Look at this another way, if your customers lose JobKeeper, will that then affect you?   What could be needed to deal with this; could they close owing you money, will they expect discounts or longer terms to keep buying from you, can you review your Service Agreements?

4. Consider how you do Business

OnLine is no longer a novelty or a passing phase.   People's buying habits have changed and the virus accelerated this, however they may not have the same discretionary spending power as they had last year.   If you operate in one sector or location or perhaps with niche customers, you may need to be flexible and find another market (another customer, another locality, new products or services).

5. It's all about Cash

Cash flow is critical, so collect from your customers, avoid waste, be efficient.   Review your debtor terms (deposits, progress claims, payment terms, credit checks, follow-up when due). Ensure your own credit scores are okay – pay on time, don't make applications for finance unless you need it.   Forecast your expected Sales and Expenses for a year. Then forecast Cash for the same time, plus include finance payments, personal drawings, GST, and taxes.   Profits may look good on paper but Cash is the lifeblood of a business.

6. Manage Inventory

If you sell goods, the general rule is that the lower the number of days sales are held in inventory the more efficient you are.   A good Inventory Turnover ratio is between 5 and 10 (times a year), the number of times a year that your inventory is sold (so 5 is inventory turned over in 73 days; 365/5).   Holding stock has a cost (interest, storage, deterioration), so the faster you can sell the quicker it turns back into cash.   You also need to consider how long it may take to source new stock from suppliers, especially now, which may mean that more stock on hand may be temporarily required.

7. Customers and Competitors

A business loses 68% of its customers due to perceived indifference, or when a customer believes the business appears not to care whether they purchase or not.   You must market well, provide great (or better) service, and stay top-of-mind with your customers.

8. Get it Right

Know what you want to achieve, get your marketing right, and ensure your systems are effective and that you are accountable for decisions.   Focus on what is important or a priority.   Businesses need to be right more often, avoid costly mistakes, test and measure often, go after opportunities, and keep learning.   Ensure you have the information needed to make decisions, don't rely solely on gut feelings.

Actions Required

- Do some 'what if …' scenarios, to look at the best and the worst outcomes, manage for the best but ensure you have a plan if the worst happens

- Refresh your website, SEO, Linked In, etc., improve your Sales Closure Rate

- Update your marketing plan every Quarter, improve one aspect of your marketing each time and monitor the results

- Look for alternatives in decisions, look at every decision from both a sales and a savings point of view

- Budget for each quarter, not just what expenses need to be paid, but also aim to improve sales and margins

- Re-do your policies, procedures and checklists (are they customer friendly, are they effective?)

- Make calls to customers, not to sell, but to be in contact, give insights or information and ensure you remain their preferred supplier.