Giving you a
little time for
yourself

Talking Cents

December
November
October
September
August
July
June
May
April
March
February
January

The help of a small business accountant is important when starting up a small business

As your small business account I need to make you aware of the important following issue.

A recent market analysis into small business by Dun and Bradstreet has shown that Australian business failures continue to rise, growing over 30% in the past three years. This escalation in small business failures has not been restricted to one particular sector of the economy, nor is it focused on a particular state or region. What is demonstrated is that the smaller the start up small business operation the more likely it is to fail. The report highlights that low consumer confidence and poor access to finance as being the main drivers of these alarming statistics.

Whilst we can all agree that low consumer confidence is hampering the growth of our economy and that banks in general have definitely tightened their lending criteria when it comes to small business, a well planned small business venture should factor in these issues and have a clearly defined strategy to overcome them.

Starting a small business will always require an investment of capital from the business owners, whether it be for equipment, shop and office fit outs, or just for working capital until the business solidifies its client/customer base. If you are looking into starting your very own small business, then cash flow analysis of the start up phase of the business is essential and must be one of the first aspects of a business plan. If the cash is simply not available to kick things off then sources must be found or the business venture put on ice until a source of funding is secured.

Further, as the business owner you must have a back up source of funds to live off in the businesses start up phase, as the business may not have sufficient cash flow to pay you a wage or salary in its infancy.

If you are at all concerned about your businesses cash flow situation then it is imperative that you take action now, before it is too late. I have previously blogged about the fact that the ATO must not be used as a convenient source of funds, by delaying payment to the ATO, you are only living in denial of a deeper issue within your business and creating a bigger headache for the future.

If market conditions or the state of your business finances are a source of concern for you, then the first port of call should always be your small business accountant. They are best placed to advise and guide you and your business, so you can move towards a more comfortable, less stressed lifestyle. After all, shouldn't your business be working for you and not the other way around.

As your small business accountant in Surry Hills, please do not hesitate to call us for any questions or help you may need.

 
Liability limited by a Scheme approved under Professional Standards Legislation