All Posts by Renae Pitargue

5 strategies for better cash flow

Managing cash flow effectively is crucial for the health and success of any business. It's about more than just monitoring what comes in and what goes out; it's about strategic planning and timely actions, particularly when it comes to invoicing and managing receivables. 

At First Class Accounts Ovens & Murray and Busy01 Consulting, we understand the challenges businesses face and have proven strategies to help improve cash flow management.

The Foundation: Efficient Invoicing

The cornerstone of maintaining a better cash flow is efficient invoicing practices. 

Invoicing promptly and accurately ensures that your cash flow remains positive, allowing you to cover operational expenses and invest in growth opportunities. 

Utilising tools like Xero’s invoice reminders can significantly enhance your ability to follow up on outstanding payments, encouraging quicker settlements from customers.

Key Strategies 

Maintain Accurate and Current Books

Keeping your financial records up-to-date provides clarity on your financial status, enabling more informed decision-making. Accurate bookkeeping helps in identifying trends, potential shortfalls, and opportunities for improvement.

Firm Credit Control Policies

Establishing and enforcing clear payment terms is essential. While maintaining professionalism and politeness, it's important to be assertive about your payment expectations. Monitoring accounts receivable turnover closely allows for timely interventions, reducing the chances of payment delays.

Simplify Your Accounting Processes

Complexity can be the enemy of efficiency. Simplified accounting practices make it easier to manage your business metrics and maintain a clear view of your financial health. This is where our expertise can be particularly beneficial.

Separate Personal and Business Finances

This is fundamental to gaining a true understanding of your business’s cash flow. Mixing personal and business finances can cloud your view of the business's actual performance and impact your financial decision-making.

Establish a Cash Reserve

A safety net of reserved funds can be a lifesaver during unforeseen financial challenges and also provides the flexibility to seize growth opportunities without the stress of financial constraints.

Actionable Steps to Enhance Your Cash Flow

Start by refining your invoicing process; make it a routine to issue invoices immediately after goods or services are delivered. This sets a professional tone and reduces the payment turnaround time. 

Following the strategies outlined above not only helps in collecting revenue more efficiently but also keeps your finances organised and your business prepared for whatever lies ahead.

How We Can Assist

First Class Accounts Ovens & Murray and Busy01 Consulting are here to guide you through the intricacies of cash flow management. From implementing the appropriate Apps to optimise your invoicing process to implementing effective strategies, our expertise can help you navigate the bookkeeping and cash flow aspects of your business with confidence.

Are you ready to take control of your business? 

Contact us for personalised guidance on bookkeeping, invoicing, cash flow management, and how to keep your business financially healthy. 

We can help you implement the appropriate Apps and practical strategies that align with your business goals. Get in touch today, and let's work together to secure the financial stability of your business.

Business Exit Strategy

Starting and growing a business is a journey filled with passion and perseverance, yet many entrepreneurs overlook the crucial aspect of planning their exit. 

A well-thought-out business exit strategy is essential for ensuring the sustainability of your venture, the welfare of your employees, and the preservation of your legacy. 

The Importance of a Business Exit Strategy

A business exit strategy is not just about ending your entrepreneurial journey; it's about setting the stage for the next chapter of your business and your life. It's a plan that outlines how you will transition out of your business, whether through selling, passing it on to a successor, or another method. 

Planning your exit strategy early can significantly impact your personal and professional satisfaction and ensure a smooth transition when the time comes.

Key Components of an Effective Business Exit Strategy

Succession Planning

This involves identifying potential successors within your family, your employee pool, or your franchisees. It's about finding individuals who share your passion for the business and have the potential to drive it forward. 

Succession planning is a strategic process that includes identifying, training, and eventually transitioning leadership to the chosen successors.

Alternative Exit Strategies

For those not interested in traditional retirement, retaining a stake in the business can be an appealing alternative. This allows you to stay connected to your business without the day-to-day responsibilities, offering a balance between involvement and leisure.

Preparing for Sale

If selling your business is your preferred exit strategy, it's crucial to make your business as attractive as possible to potential buyers. This means optimising business operations, ensuring clear documentation of processes, and addressing any areas that could detract from the business's value.

The Role of Professional Support for Your Exit Strategy

Navigating the complexities of a business exit strategy requires expertise. 

This is where a bookkeeping firm with expertise in business planning and strategy can be invaluable. At First Class Accounts Ovens & Murray, and Busy01 Consulting, we can assist in evaluating the financial health of your business, optimising operations for maximum efficiency, and preparing detailed documentation that is crucial for succession or sale. 

We can also offer insights into market trends and valuation strategies to ensure you receive fair compensation for your life's work.

Whether you're considering succession, partial involvement, or selling, professional guidance can help you maximise the value of your business and achieve a successful exit.

Initiating the Exit Planning Process

The process of planning your business exit strategy should start well before you intend to step away. It's a forward-looking approach that requires careful consideration of your personal and business goals. 

Engaging with professionals early in the process can provide you with the insights and support you need to develop a comprehensive and effective exit plan.

So, while starting a business is often driven by immediate goals and the excitement of bringing a new idea to market, planning for the future is equally critical. 

An effective business exit strategy ensures that when the time comes to transition away from your business, you can do so in a way that maximises your personal and financial rewards, secures the legacy of your hard work, and provides for the continued success of the business under new leadership. 

Starting the conversation about your exit strategy today can pave the way for a smoother and more rewarding transition tomorrow.

Talk to us about how we can assist you in developing a tailored business exit strategy that aligns with your goals and aspirations.

Data regulation and ticking the right compliance boxes

Your business faces an increasingly complex regulatory landscape when it comes to data privacy, consumer protection and industry-specific compliance requirements.

Keeping on top of these compliance requirements is a complex task. Failing to meet your requirements can have serious implications, with non-compliance (whether intentional or accidental) resulting in legal repercussions and possible reputational damage for the company.

Taking excellent care of your customer data

We live in a digital world, where your organisation collects huge amounts of data from your customers. This includes contact details, financial information, credit card details and detailed breakdowns of their spending habits and buying preferences.

In an effort to protect this data and preserve customer privacy, there are various data regulations that you must comply with.

A sample of these global data privacy laws include:

• General Data Protection Regulation (GDPR) in the EU 
• The Data Protection Act 2018 in the UK
• The Privacy Act 2020 in Australia
• The Privacy Act 2020 in New Zealand
• The Federal Trade Commission (FTC) Act in the USA

Depending on your organisation's home territory, and where you trade, there may well be international, national and local data regulations to comply with. That’s a lot to get your head around, especially if you’re new to business and not familiar with the legal framework.

So, what can you do to make your compliance journey simpler and as effective as possible?

Here are five simple steps to enhance your compliance:

Work closely with legal advisers

Navigating compliance can be complex without legal expertise. Consulting legal professionals provides clarity on specific obligations relevant to your industry and region. They can guide you through the intricacies of laws such as GDPR, ensuring you understand how these regulations affect your business operations.

Run regular compliance audits

It’s important to conduct regular risk assessments of your in-house data compliance. These audits help your organisation stay in line with all relevant regulations and industry standards. They also keep you abreast of any changes in compliance laws. By regularly reviewing your processes, you can identify potential risks and take steps to mitigate them before they become issues.

Protect your customer data

Your customers expect you to take good care of their data, both personal and financial. Secure your customer and business data through end-to-end encryption and use of the best data privacy practices. Implementing robust security measures like end-to-end encryption and following best data privacy practices is crucial. This involves more than just securing data against external threats; it also includes internal policies to prevent data misuse.

Deliver regular training and keep your employees up to speed

Your team needs to know the latest rules around compliance and what’s required of them. This means running frequent compliance training, so there’s a culture of compliance awareness. By keeping your employees updated, you minimise the risk of inadvertent non-compliance and empower your staff to handle data responsibly.

Use the latest data storage solutions

With so much customer data being generated, it’s important to use up-to-date documentation management and data storage software. These solutions keep your records and data secure, organised, and readily accessible. They also facilitate compliance by ensuring data is stored and managed according to legal requirements.

A team effort

Getting a grip on data compliance is a team effort. It’s important to work with legal, IT and data security professionals to ensure your organisation is ticking all the correct compliance boxes.

By following these steps, your business is more likely to not only comply with current regulations but is also prepared for future changes in the legal landscape. It's about safeguarding your business from legal repercussions and strengthening your reputation as a trustworthy and responsible operator in the eyes of your customers and industry peers.

As your bookkeeper and payroll service providers we can connect you with experts in all the relevant compliance areas, so you get the advice, support and training you need as an organisation. Get in touch. 

Setting Goals for 2024

The new year is a new beginning. If you are a business owner, this is often the time of year when you reflect on where you are at and think about your business goals for the year ahead.

Setting goals is an essential part of personal and professional growth. These could be lofty goals, or even setting out a plan to achieve some more mundane (but equally important) projects. Whether that is getting paid faster, reassessing expenses or bigger things like automation of processes and new markets. You may be looking to expand your business or create more time for yourself.

Having a clear vision and actionable goals can help you achieve your long-term plans.

Here are some tips to get you started

Envision your future

Reflect on what you truly want from your life and how your business can help you achieve those aspirations. Consider where you want your business to be in the next five or ten years. Having a clear endpoint in mind will make it easier to set goals that align with your vision.

Set measurable goals

Vague goals can be challenging to track and evaluate. Instead, focus on setting goals that are measurable. Think about the key metrics you already monitor in your business and how you would like to see them improve. For example, aim for a 3% increase in net profit year-on-year, a 2% reduction in expenses, or acquiring two new customers per month or grow your prospect database by 50%. If you set specific targets, you can easily track your progress and make adjustments as needed.

Develop a plan for each goal

Once you have identified your goals, it's crucial to create a plan of action to achieve them. This can be as simple as jotting down your ideas or engaging in a brainstorming session with your team or advisors. Having a well-defined plan in place will help you stay focused and motivated to follow through.

Monitor your progress regularly

It's essential to regularly check in on your progress towards your goals. Set reminders on your calendar or align your monitoring process with your invoicing cycle. By consistently evaluating your progress, you can identify any areas that need improvement or come up with fresh ideas to help you reach your targets.

Celebrate your achievements

Celebrating milestones along the way is crucial for maintaining motivation and momentum. Plan a reward for yourself when you achieve a significant goal. It could be treating the team to a morning tea, having a day out of the office together or planning an event for the end of the year. Choose something that brings you joy without breaking the bank.

Not sure how to get started?

We can help you with the strategy and identifying the information you’ll need to track, so you can monitor your progress. So, let's talk. 

Setting goals is just the first step. By implementing these tips and staying committed to your vision, you can turn your long-term plans into reality.

Writing a business plan?

Read our guide

Your business plan is the sat-nav that keeps the company moving in the right direction.

Having that guidance can be a massive benefit to your success as a business. But what elements should you include, and...

What are the main considerations to think about

A detailed business plan will generally include:

A clear direction for the business

A well-crafted business plan gives you a defined path to follow, outlining the company’s purpose, goals and strategies. This helps everyone understand the business's mission, so you’re pulling in the same direction.

An overview of your financial strategy

Your plan will include revenue projections, expense forecasts and funding requirements. This financial guidance gives you the foundations for mapping out your budgeting, cashflow and securing investments.

An overview of threats and opportunities

A robust plan will identify the potential challenges and risks faced by the business. This helps you develop contingency plans for overcoming these challenges, reducing your risk and keeping the company on track.

A summary of your sales and marketing strategy

Outlining your sales and marketing strategy helps you target the right audience and differentiate your business in the market. This is vital for winning customers and driving your sales revenue.

Attract the right investors and lenders

A solid business plan enhances your credibility when you’re approaching investors or lenders. A good plan will demonstrate your commitment to the business, your understanding of the market and your ability to achieve long-term success. This is essential for securing investment and funding.

7 steps to creating a plan for your business

There’s no ‘one size fits all’ business plan. Your business plan should clearly outline your goals and how you intend to reach them. As a starting point, this should include how you intend to set up, finance, manage and run your business.

Use the following seven headings to kick-start your planning process. We can help you work through the numbers and strategic thinking to support your goals:

Describe your business idea

What’s the idea and how does it work? Try to have an ‘elevator pitch’ that quickly and simply describes the potential of your idea.

Set out your business goals

What are your objectives for the business? Set out your vision for the business and what your core mission will be.

Outline your ideal customer

Do the research to provide an overview of your target market (the people or organisations you’ll sell to).

Do some competitive analysis

Who are your competitors? Consider all the possibilities. They may not be in your precise sector but still compete for the same consumer dollar. What is your competitive advantage (the reason they pick you over your competition)?

Perform a business financial analysis

How will you fund your business and can you demonstrate the financial viability of the business idea?

Sketch out your sales and marketing plans

Show how you’ll win customers and generate revenue. Consider the 4 Ps of marketing (Product, Price, Place, Promotion). Plan your budget and work out what your return on investment (ROI) will be.

Outline your business structure

Give an overview of your organisational structure and your strategic and operational roles as directors.

A Business Plan is essential

A well-structured business plan is an essential document, whether you’re a new founder that’s just starting out, or a seasoned business owner looking to grow and diversify.

Your business plan is never written in stone. It’s a dynamic and evolving document that changes as the business progresses. Revising your business plan on a regular basis helps you improve your goals, refine your strategy and adapt to meet changing circumstances and markets.

How can Busy01 Consulting and First Class Accounts Ovens & Murray help you with your business plan?

Having a solid business plan is what gives your company direction, structure and meaningful objectives as an enterprise. We’ll help you understand your business goals and vision, and will help you translate this into a watertight business plan. We’ll also help you track your performance against this plan, and will work with you to update the strategy as the business evolves.

If you’d like to know more about business planning, we’ll be happy to explain. Get in touch to discuss your business plan.

A business budget will help with your financial decision making

Budgeting is about estimating your revenues, projecting your expenses and detailing the allocation of funds, so you stick to (and don’t overrun) your agreed budget ceiling.

How does budgeting affect your business?

Having a clear, agreed budget gives you a structured framework for your financial decision-making. It’s a practical way to control your costs, monitor performance and adapt your strategic and financial decisions to meet changing economic conditions.

Using budgeting helps your business in a number of ways:

Better control over your finances

Budgeting gives you a clear roadmap for managing your company’s finances. Sticking to that budget helps you maintain control over expenses, reduce wastage and make the very best of your resources.

Achieving your financial and strategic goals

Your budget helps you to set and track financial goals, making it easier to align your business strategies with your desired goals and outcomes. It’s a great way to boost growth, profitability and debt reduction.

Improved control over your cashflow

Effective budgeting helps you anticipate any cashflow fluctuations. That’s a bonus that helps you plan for both lean and prosperous periods, making sure you have the funds to cover expenses and seize opportunities.

Allocating your resources

Budgets are useful for guiding how and where you allocate your resources. From your one pot of cash, you can decide whether to prioritize investments, marketing efforts, operational improvements or business growth.

Keep track of your performance

Comparing your actual financial results to your budgeted results helps you quickly assess your performance as a business. You can look for variances, make timely adjustments to stay on track toward your goals.

How can Busy01 Consulting and First Class Accounts Ovens & Murray help you with budgeting?

Being in control of your expenses, spending and predicted revenues sits at the heart of your financial management, giving you a framework and set budgetary goals to aim for, track against and (hopefully) achieve.

As your bookkeeper, we’ll help you set up budgets for your strategic business plans, with clear tracking and reporting to keep you on the ball and meeting those targets.

Get in touch to chat about budgeting.

Is there such a thing as over-automation? 

The need for a human touch

Automating your key systems is the way to turn your enterprise into a 21st century, digital business. But are we getting carried away with automation? And could we be systemising areas which could benefit from a more personalised, human touch?

Personalisation of the customer experience is vital. Automation can play a big part in creating targeted, data-based personalisation for each customer. But not everyone loves automation.

36% of customers in a recent survey would rather wait on hold to speak to a human agent when they have an issue, rather than interacting with an AI-powered virtual assistant to self-serve.

So, how do you get the balance right between automation and a genuine human touch?

A big part of offering a top-notch customer experience (CX) is having direct, personal human interactions with your customers. So, which tasks should you be automating? And which should you leave for your human team to deal with?

Here are a few ways to get the automation/human balance right:

Automate your basic admin tasks

Most of us hate the tedious, time-consuming admin tasks. With smart use of software tools and customised AI assistants you can quickly automate things like onboarding new customers, answering basic FAQs or sending out reminders and notifications to your customers.

Automate your key finance tasks

Many of the current crop of cloud accounting platforms have automation and artificial intelligence tools built in as standard. These tools help you automate your invoicing process, the collection of customer payments and the matching of transactions for your bank reconciliation process. This makes your bookkeeping and cashflow more effective and delivers real-time financial data.

Don't automate the whole customer journey

Customers want efficiency but not impersonal automation throughout their entire customer journey. 77% of customers say they’re more loyal to businesses that offer top-notch service – and being able to speak to a human agent can be a big part of personalising and humanising these interactions.

Make your people integral to your brand

The personality and experience of your people is vital to your brand identity and your CX. Have as many human interactions with customers as possible and tailor your interactions in the most personalised way.

Don't put efficiency over and above having a human face

People buy from other people. Because of this, having a human touch is vital for delivering a top-class CX to your customers. You can have a slick, automated buying experience when it adds convenience, but don't remove people entirely from your offering. Without humans, you have a software process, not a real, living, breathing business.

Talk to us about keeping the humanity in your automation.

There’s no denying that automation and smart use of AI will be vital for creating an efficient and productive digital business. But it’s important to never discount the importance of people, human interactions and real customer relationships when building and growing your business.

Holiday cashflow for your business

Whether you’re heading into a holiday period, or just planning to take a break (and congratulations, because a healthy business means work-life balance), it’s important to keep your cashflow under control. This means pre-planning and being proactive.

When you’re not in the office, there are still overheads and salaries that need to be sorted. If taking time off means that less cash will be coming in, it’s essential to plan for this period to make sure that these costs can be comfortably covered. Make sure you have a clear picture of your payroll, and any other planned expenses that will need to be accounted for.

If there’s even a possibility that there could be a shortfall, it’s essential to meet this head-on. Whether this means talking to your supplier or creditors to figure out an arrangement, or compromising on other business outgoings, you must make a plan to ensure that the business, or your staff, won’t suffer.

Tips to minimise the stress of cash-flow over the holiday period

Invoice early

Sending out invoices promptly is your first line of defense. Consider going a step further by offering early payment incentives or exploring retainer agreements with regular clients. This ensures a steady inflow of cash before the holiday rush begins.

Chase payment

Building strong relationships with clients is paramount. Take advantage of this season to initiate open conversations about outstanding payments. A friendly reminder can make a significant difference, fostering goodwill and ensuring your business is on solid financial ground.

Talk to suppliers

A transparent relationship with suppliers is invaluable. Engage in open discussions about your cash-flow concerns and explore the possibility of extending credit terms. Most suppliers appreciate honesty and may be willing to accommodate your needs to maintain a long-term partnership.

Review your costs

Business costs have a tendency to accumulate gradually. Regularly reviewing expenses is a prudent practice irrespective of the holiday season. Take a comprehensive look at subscriptions, regular payments, and upcoming expenses. Identifying areas where costs can be optimised ensures financial stability throughout the year.

Explore alternative approaches

This is an opportune time to reassess your approach to travel, functions, and purchases. Are there cost-effective alternatives or adjustments that can be made without compromising quality? Being flexible and creative in your spending can contribute significantly to maintaining a healthy cash flow.

Talk to the bank or tax department

In times of tight cash flow, initiating early conversations with your bank or tax department is crucial. Discussing potential challenges in advance allows you to explore options, meaning you will have the necessary support to navigate any financial hurdles during the holiday season.

Preparation is key

All businesses need a holistic approach to tackle cash-flow challenges. Develop a comprehensive plan that encompasses all aspects of your financial landscape, from client interactions to supplier relationships and internal cost management.

This time of year can be hard on businesses. By implementing these strategies and staying proactive, you can not only minimise cash-flow challenges but also position your business for success in the coming year.

Do you know the rules and entitlements during the end-of-year holiday season?

As we head into the summer holiday period, is your business up to speed with your rights and obligations?

If you don't outsource your payroll, it can be confusing to employers and employees alike – public holidays worked or taken as annual leave, business shutdowns, annual leave provisions… there are many rules employers need to understand.

Employees are entitled to annual leave and public holidays under the National Employment Standards minimum entitlements.

Employers can ask employees to work on public holidays within reason. For example, if the business is open every day of the year, and the employment agreement states that public holidays may be required, the employer can reasonably ask an employee to work a public holiday.

An employee can refuse to work on a public holiday if the request is unreasonable or there are reasonable personal grounds for refusing.

Christmas and New Year Public Holidays 2023-24

The following link has the Christmas and New Year Public Holidays that apply to employers in all states for the Christmas period and beyond - 2023 Public Holidays

Public holidays are paid at ordinary rates for employees who take the day off. Employees who work on a public holiday must either be paid penalty rates according to the relevant award or be given an extra day off in lieu of the public holiday. Some awards have specific provisions or additional benefits for public holidays, so it's important to check.

If an employee has booked annual leave for the Christmas and New Year periods, the public holidays are not counted as annual leave.

Some other key points to remember

• Public holidays are counted as service, so annual and personal leave continues to accrue as usual.
• Overtime worked on a public holiday may be paid at a different rate than regular overtime – check the relevant award or agreement.
• Check the award or agreement for shutdown provisions. Most awards have guidance for directing employees to take leave during annual shutdowns.
• If employees don’t have enough annual leave, employers can agree to pay them in advance for leave not yet accrued, or the employee can take unpaid leave.

The FWO has further advice on rules and entitlements during the end-of-year holiday season.

You might also need to think about cash flow planning for the holiday period, particularly if the business shuts down but still has obligations for payroll and other expenses.

We can advise you about your employer responsibilities and help plan holiday period payments so you can make the most of your summer holiday! Better still, talk to us about outsourcing your payroll.