All businesses can operate, provided they can meet the rules to operate safely. Businesses are still required to display the official QR codes for the NZ COVID Tracer app at all alert levels.
For more information, check out the business.govt.nz page for Workplace operations at COVID-19 alert levels
Running your business at a loss is normal if you’re starting out or growing fast. But if it continues, you may be in trouble. Here are warning signs to look out for and tips for getting back in the black.
Business debt hibernation is a new scheme for companies, trusts and other entities affected by COVID-19 to manage existing debts until they can start trading normally again. Find out if it’s a good option for your business and how to get started.
Unpaid debts and the impact they have on cash flow is one of the biggest risks your business can face. If you have no money coming in, you can’t pay your suppliers without going into debt or using up cash reserves.
Sometimes business can be booming and you still have no money in the bank. The answer is to focus on getting paid in full and on time.
One way to reduce the risk is to have a cash flow forecast for all your income and outgoings. You’ll see shortages coming and can plan to lessen the financial blow.
This is quite normal for start-ups, but could be a warning sign for more established businesses.
The flip side of not getting paid on time is you don’t have enough in the bank to pay your own bills. It’s another sign you need an accurate and up-to-date cash flow forecast.
If you don’t pay your suppliers on time and in full they may stop supplying you — a huge risk to your business. Here are some tips on how to do it:
The longer your income falls below your costs, the harder it’ll be to get into profit.
If your business slows down at the same time each year, factor this seasonal downturn into your cash flow forecast. Spotting a general dip in the economy or your sector is hard to do. A good place to start is the Inland Revenue website — its Industry benchmarking tool(external link) helps you assess your performance by comparing your business with others in the same industry.
An accountant can help you improve your financial forecasting.
What’s your cash flow? Your break-even point? How much of what you make or supply do you need to sell to meet your costs — and how much to make a profit?
If you can’t answer these questions, your business could be in trouble. You need to know what money is due into your business and when.
Cash flow forecasts also calculate your outgoings, so you know when you’ll have the money to pay your bills. Get your accountant to help you understand your long-term cash flow.
There are other signs to look out for in your day-to-day business including:
If any of these apply to you, talk to an advisor who specialises in turning businesses around.