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Loans for SMEs

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Getting a loan is an almost inevitable part of running a business but running the gauntlet of lender approvals can be a daunting task.

There is almost nothing worse for a SME than when the bank denies you a loan, and the past few years including the Royal Commission and the recent pandemic means, there has been a general tightening of credit.

Banks, or other lenders, often provide unfortunately opaque reasons for denying a loan, that are often misunderstood by business owners.

We unfortunately know all about it; in a former life, we were the ones accepting and denying SMEs for loans (and being equally vague about why).

We wanted to share our insights into how banks make these decisions and what business owners can do to maximise their chances of getting a loan.

The first step you should always take if rejected for a loan is to revisit your business fundamentals, understand and fix them. Fix your business fundamentals and then, come back to the bank, or as a second step understand your options outside of it.

In the most (over) simplified way possible, bankers assess:

  1. Character of borrower
  2. Capacity to repay
  3. Collateral to support the loan

So, here’s what you need to know about these three categories.

  1. Character of the borrower

This is about you and your business alike.

What kind of business do you run: First of all is how you present your business. While being a “startup” is appealing to investors and lends towards a certain buzz, if you want a loan you’re better off framing your business as a SME.

Banks generally tend to lend to established businesses which have a clear purpose, are generating profit (particularly cashflow), ie, not higher risk companies.

Experience: The bank will also see it as a positive if you’ve got relevant experience. If you’ve been through multiple business cycles, seen highs and lows they will assess you positively in this respect.

Personal character: No banker will be able to refuse a loan without a good reason, but gut feel tends to lead towards a yes or a no. That means if you’re honest, transparent and respectful, it may actually help!

  1. Capacity to repay

Think about a concept of the “jaws”. If your income is going up, and expenses are going down, they are open. If it’s the opposite, they are closed, like the bank will be.

Can you repay the loan: this is pretty straight forward, but you need to be able to able to show you can repay the loan on a conservative basis. The current low interest rate environment should improve everyone’s capacity to pay; however banks are generally assessing you on a relatively higher rate (affordability), which can at times be 2 to 3 percentage points higher than the quoted rate. Banks will also consider repayment of the loan over a reasonable timeframe (3 to 5 years for a business loan) depending on the request.

Does your business operationally make money: Banks will consider things like investment for growth, but they want to know that for every product or service you sell, you are covering the cost of doing that directly. At minimum do you make a good gross margin?

Right now: Banks are more conservative, they’ll look at what you did last year and over the last few years. They are putting a lot less weight on future outlook, and they will most likely, heavily sensitise your assumptions.

Tax focus: Many businesses also structure their books to be most beneficial at tax time.

However, a tax-focussed accounting strategy does you a disservice to what you need to get a loan from the bank. You want to take advantage of tax but understand the economic reality of doing this. You may benefit in the short term from the tax deduction, but lower profits to reduce your tax bill will reduce your borrowing power, and your ability to capitalise (pun intended) on growth opportunities.

  1. Collateral to protect the loan

Assets: what collateral do you have to support the loan and how will external factors affect these? For example, the family home is a common asset, but fluctuations in property prices can have an impact. Or take a look at what you’re buying, the bank is likely to have said no for a reason – they may not have appetite for the asset you’re trying to buy.

So they said no...

Image credit – Dan Dimmock via Unsplash

If you can’t get a loan, we’d encourage you to look at the above and think about why.

Depending on the reasons, getting a loan on a business which isn’t working will end up hurting you more and you may end up losing more than you already have.

Use the rejection as a moment to step back, fix what’s wrong, or find another path.  

Jun Yan is the co-founder and director at Ravit Insights. Prior to this, he was a commercial banker at NAB.

How to achieve your business goals this financial year

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Image credit: Jess Bailey via. Unsplash

Planning the blue-sky future for your business can be equal parts exciting and daunting. Now that we are into the first quarter of the new financial year, it may be a good time to take a step back and look forward.

This is especially so if, like many of us, you’re facing an uncertain business environment.

The old cliché is true: if you don’t plan, you plan to fail.

It’s good practice for business owners to regularly ask themselves important questions such as: “What is it that I want from my business?”

This kind of questioning can help avoid major mistakes business owners often make when it comes to budgeting, such as thinking only in terms of spreadsheets, numbers and dollars. 

An effective budget is not something you can ignore as just a checklist and a tick-box exercise to make sure your expenses aren’t out of control (though that’s part of it). Nor is it something that should be so incredibly detailed that it becomes over the top and almost unuseable.

The best budgets we’ve seen are the ones that take into account business plans, what that means in expenditure and how that translates to required revenue with some room for blue sky growth.

We see it framed as a “top down” or “bottom down” method, but a great budget is an iterative process. Here’s our guide to effective budgeting steps.

Image credit: Andrew Neel via. Unsplash

Step 1: Where are you headed?

The budget you’re about to create is a tool to take your business to where you want it to go in the coming financial year.

That might be through a strong growth curve, it might be about maintaining a stable level of revenue, or it might even be winding things down.

A budget, combined with good financial models will help you prepare for uncertainty, and achieve your goals, but you need to know where you’re headed first.

Step 2: Start with what you can control

Your first iteration of your budget will look at the basics starting with your expenditure and then looking at the revenue you need to account for that, taking into account any seasonality.


  • Understand your minimum requirements and expenses for the coming 12 months including basics like rent, staff, subscriptions, bills and utilities.
  • Review whether you have any upcoming major costs in the next financial year
  • Use this opportunity to make a judgement call, review your expenses and see what can be cut.


  • What is your projected revenue for each quarter?
  • Adjust your revenue across the financial year for seasonality so you get a good sense of what your budget should be.

Step 3: Are you being realistic?

The second step is to review your projected revenue and see if it covers your expenses and delivers on your business goals.

  • Is it a realistic projection of revenue? For example, if you will need to grow your business by 50% when you historically haven’t, your budget is likely to lead you into trouble.
  • Can you deliver? If you’re aiming high for growth, you need to make sure you’re also making reasonable assumptions within the budget. For example, you may need to add additional staff, or potentially go the other way and bring down expenses.
  • Understand what the numbers mean: You will need to understand the changes that might come from growth or downturn in revenue and how to be prepared for that

Step 4: Review, revisit, readjust

As much a budget would be ideal to set and forget, it’s simply not something that can be left untouched. Checking in with your budget and forecasts is needed once a month at minimum.

Especially in times of uncertainty, this monitoring is vital for business owners looking to understand how they are going and where the business is headed, even if the future is hard to predict.

We also practice what we advise, and run this process as a weekly cadence at Ravit Insights to make sure we stay on track. It’s also rewarding to hear that clients use our models to manage their business planning and budgeting on a weekly or, in times of high growth or crisis, a daily basis.

The budget is first and foremost a plan and a structure to help you achieve your business goals. It should help you achieve what you intend to achieve, and whether you hit it or not, it gives you a goal post to aim for.

September warning: what SMEs need to prepare for 6 months into the pandemic

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Image credit: Vanguard Visions via. Flickr

In a normal year September heralds football finals, the start of spring and the surprising realisation that major retailers are setting up for Christmas already.

This year is different.

September will mark six months since the start of the coronavirus pandemic stimulus packages across Australia. This includes JobKeeper, JobSeeker, rental relief, loan repayment deferrals, and others. While the Morrison Government is currently revamping these, businesses must begin to prepare now.

The six month mark will come at the same time as quarterly BAS payments, and these combined could be disastrous for under-prepared businesses if they are no longer eligible.

For many small and medium business owners, the coming months mean continued uncertainty as the country deals with a second wave of pandemic, and a state of flux around tightening and relaxing of restrictions.

Like most business owners, we aren’t able to tell what the 20/21 financial year is going to look like, nor what assistance from Government could look like in the face of ongoing restrictions, but we can help mitigate the uncertainty.

Plan for September now

The best way to deal with uncertainty is to deal with what you know. Right now, the stimulus is set to evolve, and that means you’ll need to prepare how your business, and potentially your personal finances, deal without this support.

You’ll need to look at the new version of ‘business-as-usual’ and prepare for restrictions that cause ebb and flow in business. That means a good budget, solid business processes and a clear idea of what you would like to achieve.

It’s important to remember other BAU factors like seasonality, potential growth issues and even the basics such as invoicing.

Make a real assessment of your business, you may need to cut back and conserve capital sooner rather than later.

Your business beyond the stimulus

Image source: Jirsak via. Adobe Stock

Thinking beyond the stimulus, you will need to consider the next steps and how your business will thrive in a new environment.

There are multitude of options. Can I Pivot? If not, then what else? What next?

Many businesses are struggling, but are also pivoting, changing and innovating. The silver lining of the pandemic is that it will likely push forward innovation in business practice, even in traditionally resistant industries such as hospitality, which is embracing technology to deal with closed dining rooms, social distancing and reliance on takeaway, delivery and ecommerce.

What will your business look like without JobKeeper

Business owners will need to make some potentially tough decisions about staff once or even before JobKeeper has ended.

You will need to assess whether you have the revenue or cash in hand to continue to pay staff and deliver business as usual.

Do not forget your legal responsibilities. If you need to make any permanent staff redundant, you will also need to pay out entitlements.

The Council of Small Business Organisations Australia chief executive Peter Strong warned that accruing of entitlements was “a huge issue” and said some businesses would be better off without ‘zombie workers’ who would present a financial liability to let go.

“It’s been a good scheme because it’s meant keeping more people on. But many are accruing a debt that they can’t pay because they haven’t got the income coming in,” Mr Strong told the AFR.

Dealing with loan deferrals

Business owners will also need to be realistic about their debt once the deferrals lift.

If you have deferred or put on hold loan repayments, you will need to know exactly what and how you’re expected to repay. You should not be caught out on this, so ensure you are very clear as to what is expected and prepare to meet that obligation.

If you need clarity or help with visualising what this may look like for you, feel free to reach out to us.

Hard truths: How to know when to close your business

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Image source: Craig Whitehead via. Unsplash

Early on in the corona virus pandemic, it came as a worrying surprise when several businesses shut up shop.

However, the further into uncertainty we go, means later closures have almost come as heavier blows.  One example is Melbourne’s iconic restaurant Ezard which had been open for more than 20 years, which heralded the tough conditions across industries when they announced permanent closure in June.

Chef Teage Ezard said coronavirus wasn’t the sole reason for the closure but said “It was just time”.

This is the key.

Pandemic and economic uncertainty aside, knowing when to close down is important.

Ultimately, timing a closure well is one of the best business (and potentially personal) decisions you can make. It will save you money, time and stress, even more so if you have staff to manage.

The six-week lock down in Victoria has been a shock to business owners, especially those recently re-opened and reliant on face-to-face contact including gyms, cafes, pubs and beauty salons and many will now be faced with tough decisions on how to take their business forward.

Here are a few things to consider if you’re facing a difficult second half of 2020:

What is the new normal?

If you are running a private business, the unfortunate reality is you can’t rely on temporary government handouts to survive and so business viability must be considered beyond the stimulus of JobKeeper as it continues to evolve, increased tax benefits and deferrals to loan repayments.

Businesses will now need to evaluate the new (some temporary, some not) rules for what constitutes “business as usual”. It is likely that this will come with some degrees of uncertainty.

Some things to consider include:

  • Where will your customers come from?
  • Do you still have access to the same supply chain?
  • Can your revenue sustain the same staffing levels (more or less)?

Are you chasing your way down?

The danger of the transitory nature of the current climate is being lulled into a waiting period where it feels like things are on pause.

While the JobKeeper stimulus is a fantastic measure that is allowing many businesses to keep on staff, if you are not generating revenue, you must also pay attention to the potential pay-out liabilities of annual leave, superannuation and more.

In addition if you’ve deferred loan repayments, or taken out further loans, can you afford to keep servicing these?

Can you pivot?

Image source: Eiliv Sonas Aceron via. Unsplash

As an industry, hospitality is suffering through reduced in-venue dining numbers due to lock-downs, a pivot to reliance on takeaway and delivery or a switch to an e-commerce model selling food and beverage beyond their meals.

But there is opportunity in the struggle.

Many hospitality businesses will have diversified their offering for the first time into ecommerce or takeaway, giving their business the best chance of survival now, and long-term potential for greater profit margins when things do return to normal.

Other business owners should consider the pandemic in the same way. Is there a better, safer way to do business or access channels and markets that you wouldn’t have had time or scope to approach in the past?

Social distancing and public health concern has opened a door for technology into our restaurants. What is this crisis doing for your industry?

The hard decision

The hard truth is, that like Ezard, the right decision for your business might be to close.

We recommend considering the following carefully to guide your decision:

  1. What is your projected revenue and will it drive the business you want to run?
  2. Are you still able to maintain personal health and passion for your business?
  3. Are your customers engaged and interested in your product or service?
  4. Are your staff engaged and sticking with you?
  5. Can you temporarily put your business on pause?

Tax-time warning for SMEs: How always focusing on June 30 can blur your long-term vision

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*The information in this article is general information only. It is not professional tax advice and should not be taken as constituting professional advice from the author. You should seek professional tax advice from your accountant that is specific to your circumstances. 

Every year coming up to June 30, the tax man looms large in the back of all SME owners’s  minds.  

In the lead up many will be looking to minimise how much tax they need to pay, and particularly this year, to take advantage of Government rebates and assistance. In fact, it’s one question we often get asked by the businesses we work with. 

But no business should be acting solely in the interest of minimising tax.  

The reason for this is simple. Tax incentives should not be the starting point for making smart business decisions. It is something to consider, but the business / investment decision should be considered first. 

For most of us our business goals will include growing and increasing profits, which means we’ll likely need to accept that additional tax or legal responsibilities come with this.  

To minimise tax, you’re likely to be minimising the profit that your business is making.  

Don’t be sucked in by incentives 

Right now, the Government is offering highly publicised additional instant asset write-offs as part of its Coronavirus pandemic measures to boost the economy. 

However, if you are not already planning to spend that money, and it does not make sense to do so outside of a tax incentive, this incentive isn’t worth taking up. 

But this is an uncertain time, soon JobKeeper will stop, and the long-term effects on our economy are still unknown. With that in mind, spending incentives are best approached with skeptism and careful planning. 

One common lure is that it can be really appealing for a business owner, knowing that tax incentive is there, to take an additional loan or novated lease for a new car.  

However, unless you need the car (eg you might be a tradesperson in need of a new van or ute) it isn’t beneficial for company purposes. You shouldn’t buy a car for a tax write-off.  

Look beyond June 30 

There is a controversial business adage that any company will need three books: 

  1. For tax (so you pay less) 
  1. For the bank (to get better terms/loans) 
  1. For yourself (reality) 

When you balance your books to make the most of all tax offsets, you often have a focus on a singular point in time: June 30. 

But a business doesn’t operate like this, and continues on July 1 and beyond. People are looking at the tax before looking at what they really want to do. 

Beyond tax, there will be competing interests where it is likely you’ll need to show that your business has strong performance, growth and profits.  

This could be if you’re looking to approach the bank for a loan, or even if you’re presenting your company to a potential investor.  

A great example occurs in Research and Development tax. 

A lot of companies structure the books so they can claim losses for R&D tax rebates. Keep in mind it’ll mean your company looks bad, and you’re stuck with an entity that isn’t going to be appealing if you’re trying to borrow or raise capital in the future. 

Prioritise your business goals 

Instead, business owners should prioritise what they are trying to achieve.  

What’s your plan in the short-long term? Will you need to approach the bank for a loan, do you need to raise capital, do you want to aim for high growth? 

You need a strong business plan and understanding of your fundamentals first. Then manage the tax to support this plan.  

Navigate growth 

When businesses are growing it can be daunting to step up to the next level in terms of legal responsibilities, particularly in payroll tax.  

It’s a common misstep for a business in early growth stages to avoid hiring, because they’ll have to pay over the threshold. But this can cost your business big-time in lost productivity.  

If you are trying to grow your business these are situations you will need to proactively navigate and potentially invest back into your company so it can grow.  

Understanding business fundamentals, growth projections and your responsibilities are part of this, and unfortunately leading a strategy by tax minimisation will likely cost you more in the long-term. 

It’s always important to remember if you’re paying more in tax, it means you’re making more money. 

So as the end of this financial year approaches, approach your tax with your business goals in mind, not just avoiding the tax man.  

This post was first featured on Smart Company.

Cash vs accrual accounting: a guide for Aussie SMEs

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In business timing is everything, especially when it comes down to the basics of how you manage your money.

In accounting terminology, SME owners have the option to manage their business finances either on a cash basis or through accrual accounting.

These are both very important to understanding your business fundamentals.

As we will explain, accruals accounting can help business owners feel more at ease than reporting on a cash basis.

The reason is that the former provides a better picture of what the underlying business is doing rather than just tracking cash in and out, which often doesn’t reflect the performance of the business. Cash accounting means your performance could be overstated or understated depending on when you’re looking at your accounts.

What’s the difference?

The difference between cash and accrual is in the timing.

Cash basis accounting is used when you recognise the money only once it has changed hands, put simply, when it is in or out of your bank account. That means looking at expenses when they are paid, and invoices when the money comes in.

By contrast accrual accounting recognises your performance, by tracking revenue when it is earned and expenses when they are billed – regardless of when they are paid.

So what happens with a lot of small businesses?

Cash is often the default method used by SMEs, especially those on the smaller side, as it is the minimum requirement for quarterly reporting purposes, and it is also much simpler to manage.

But that doesn’t mean it’s the right thing to do. While simplicity is a good thing, it can come unstuck as business owners may lose sight of the underlying business performance.

The benefit of modern accounting systems like Xero or MYOB is that it is now easier to manage both (accruals and cash) so you get the best of both worlds – reporting on a cash basis but still being able to see your performance and position. However, it is still essential to have a good understanding of what each means.

A case study:

Olive, who is a small sporting goods retailer, buys 100 sets of skis over a three month period (x50 in April, x25 in May, x25 in June). She sells them for $200 each (x30 in May, x50 in June, x10 in July and x10 in August)

The difference between cash accounting and accrual accounting is displayed in the table below.

The key difference is the timing of when the cost of goods sold is accounted for. As you can see, in the ‘cash accounting’ method, the cost of goods sold is accounted for as soon as they are purchased and paid for however in the ‘accrual accounting’ method, the cost of goods sold is accounted for only when the goods are sold. As a result, the ‘accrual accounting’ method provides a more accurate reflection on the business’s performance where as the ‘cash accounting’ method focuses purely on how much cash is moving in and out of the business and not necessarily how the business is performing. Another thing to look at is how the profit margin (profit/sales) is reflected in each method. Olive’s business is purchasing skis at $100 and selling them for $200 each. That is a 50% profit margin however, when you look at the scenario from a ‘cash accounting’ perspective, the profit margin appears to fluctuate every month but that is not the actual case.

There are flow on effects to broader business management no matter which you take. Let’s take a more in-depth look at both.

Cash accounting

Cash accounting is a simple method of bookkeeping that keeps track of the cash coming in and out.

How it works:

  • Expenses: when you get an invoice you don’t record the cost till it is paid
  • Revenue: you don’t record revenue until you have the cash

The pros are:

  • Simple to maintain
  • You can see easily when something is paid or charged
  • You can report GST on a cash basis
  • You can see how much cash your business has at any given time


  • You can’t see money you owe to people, or they owe to you
  • There’s no visibilty on performance… *

*If we refer to the above case study, at the start of the season it appears that the business has performed terribly on a cash basis – ordering stock, but once it makes a sale then it is likely to have improved its cash position. However, this position then neglects the fact that it will still have stock on hand, impacting the profitability of trade.

This would suit:

Businesses which have an instant fee for services such as hairdressers or small takeaway restaurants. However, these will still need to account for payroll tax, GST and other legal obligations.

Accrual accounting

Accrual accounting is a more complicated method of accounting, and you may need to get external assistance to help.

It means you record expenses and sales when they take place, rather than just the cash transactions, which means you can keep track of who you owe money to, and who owes money to you.

The pros:

  • Tracks your true financial position as it accounts for outstanding expenses or invoices
  • Helps to better understand financial performance (smooths out things like inventory orders) or delivery of work over time etc.
  • Helpful in accounting for large contracts or upfront expenses


  • It is more complicated and likely to mean you need to rely on a professional such as an accountant or experienced bookkeeper

This would suit:

Ideal for businesses that do not get paid immediately such as tradespeople, retailers, wholesalers, or a consultant who invoices at the end of a project etc.

How to pick a method

To choose the method right for you, ensure you understand how your business works and what you need to accommodate for.

You might want to consider:

  • The size of your business
  • Complexity and timeline of your transactions and processes
  • Whether you have the resources to manage more complicated accounting
  • Whether there are likely to be reporting requirements
  • Future needs including funding from banks or other lenders. Having accruals accounting will help to improve the demonstration of sophistication of accounting practices and improve the business’s likelihood of being granted funding.

As always, a great first step is to speak with your accountant about whether you need to consider a different way of managing your business finances.

Beyond Government subsidy: How to keep your staff employed

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As a business owner, being in charge of your staff’s livelihoods is a responsibility that can lose you sleep, even in boom times.

In the current climate, with many businesses reeling from revenue or business model hits due to the Covid-19 pandemic, keeping people in jobs is a genuine crisis.

The Federal Government has released a wage subsidy of $1500 a fortnight per employee with the aim to keep thousands in work during a time where we are in “social hibernation”.

Through our financial modelling, we help businesses understand what will happen in varying situations.

For many industries, hospitality, fitness and retail, dealing with such a sharp decline in revenue is almost unprecedented.

To keep businesses operational or even viable in “hibernation”  there are a few solid strategies that can help and hopefully keep staff on board through the hard months.

Can your business access the JobKeeper subsidy?

Businesses and sole traders with revenue under $1 billion will be able to access the JobKeeper subsidy of $1500 a fortnight to support employees if their revenue has fallen by more than 30 per cent (of at least a month).

The Government has also introduced discretionary measures to allow for pre-revenue, high-growth and businesses that have not been in operation for a year.

The best resource to keep up with changing information for these and other measures is direct through Government websites. We also recommend contacting your accountant for more information specific to your business.

Cut costs

Depending on how the current economy has affected your business there are probably areas that ordinarily would be considered essential that must be cut at least temporarily.

Redeploy: If you are a larger business, you might be able to move staff into different roles where more help is needed.

Leave: Other businesses are reacting by asking staff to take periods of leave, both paid and unpaid, through the pandemic period to balance their cash.

Re-negotiate terms

It is essential during these months of uncertainty to assess whether your business has a cash flow, revenue or other problem.

If it is cash flow related, speak to suppliers and other stakeholders about different terms to cope through the pandemic.

One area under focus is commercial rent with landlords moving to defer rental payments. Some co-working spaces, including the one we are based in Stone&Chalk, have offered three months rent reprieve to assist businesses through the crisis.

Flip your business

If we told you a month ago, that Attica, one of the world’s 100 best restaurants, would pivot into a bakery to survive, you’d have laughed at us.

But it has, and many other strong brands in the restaurant business have likewise flipped their models to survive through an uncertain period.

Many of us can look to these savvy business owners for inspiration on how we can change and adapt to the rapidly evolving situation.

But keep your eye on the future, a crisis can push a business to change in positive ways and ensuring you think long-term will help ensure you make the right choices now.

Charles Darwin said it best: “It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is most adaptable to change.”

Keep communicating with your team

In this period of social distancing, keeping connected to your team is important. You don’t want to lose good staff through lack of support as they’ll be essential to your recovery when things begin to pick-up again.

Although a time of uncertainty, giving your team updates to keep business progressing, and the team informed about their potential job security will help not only producitvity, but their personal wellbeing.

There is no doubt that no matter what your business is, it will be a time of evolution and change. Before making major decisions it will pay off in the long-term to return to your key business drivers and fundamentals.

We also have responsibility, and now incentives, to keep our teams together and staff employed where we can through the Covid19 crisis.

Understanding where your cash flow and growth has come from in the past, and where it is likely to pick up when the economy begins to recover will help guide your choices so they are beneficial to your business now, and when the good times come again.

Financial health check: Why you can’t manage your business by your bank account

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It’s the start of the year, and in these early days, it’s natural to take a look at how your business is going financially. The unfortunate thing is that this step is often where SMEs make their biggest mistake. They look straight at their bank account and that’s it. I’m guilty of this too, and in Ravit Insights’s dealings with a wide range of companies, the same holds true for other owners.

We too frequently take the shortcut of looking at how much cash is in the bank to guide key decisions. When running a business it can be very easy to get caught up in the day-to-day operations and looking for shortcuts like this one can land you in trouble.

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’tis the season – so is your business prepared?

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For most Australians December is either a time where your foot is flat to the floor, or you’re winding down and focusing on the next end of year lunch.

Knowing which camp you fit into is vital for all Australian small and medium businesses.

For the gelato store near St Kilda beach in Melbourne a warm summer with more tourists and beach days can make their business profitable for the entire year, even through the dark days of winter. The same goes for the retail stores, which despite declining economic environment, often rely on a very busy Christmas to buoy their annual turnover.

However, for others, like consulting firms or those in financial services, December signals a time to wind down. Often businesses will really slow down over late December and early January, with some taking a much needed break.

Whichever camp, or another, you’re in, it is important to understand how seasonality will affect you.

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Why growth is bad for your bank balance

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Growth is good. But it comes with big challenges.

With the hype in the startup world, growth, in the form of a mythical hockey stick, has become one of the much vaunted and sought after business metrics.

As we frequently see reported globally, the highest growth and highest valued technology startups are rarely profit or cash flow positive – think Uber and WeWork.

What that means for the majority of business owners, is that balancing growth with cash flow or capital needs is one of the key operational challenges.

It’s probably what you’ll lose sleep over (if this is you, take a breath and fill out our growth early warning signs check list).

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