How many times have you heard from business owners, in fact anyone in business, about how busy they are around the Festive Season; how much time they spend at work; how they spend more time with their business than their family?
Well, according to a report done by Westpac with Deloitte only a few years ago, when it comes to Australian small business owners, they are not exaggerating: “Almost three in five (58 per cent) of small business owners said they expect to miss out on sleep due to work demands during the Christmas period, 63 per cent won’t have a chance to relax and wind down over the holiday season, and 58 per cent will miss out on spending time with family and friends.”
The report continues on to find that four in 10 business owners will receive payments from debtors later over the Festive period, and will spend eight hours per week, on average, chasing outstanding invoices to alleviate cash flow pressures.
Women business owners are also more likely than their male counterparts to make personal sacrifices for their businesses - 34 per cent of women are willing to sacrifice their salary to pay staff, compared to 27 per cent of men.
In 2012 Ruby did some research into women owned businesses to uncover “first” challenges, finding that nearly half of our respondents said ‘dealing with certain areas of business they had no previous exposure to’ was top of the list of things they found most challenging when starting up their business. High on the list of other challenges were ‘securing business,’ and ‘controlling the hours worked’.
It appears that in the intervening six years - between Ruby’s women-owned business focussed research and this more recent 2018 report - controlling hours worked and making sacrifices are still the order of the day for SME owners.
Digital tools can help, and they do this in two ways. They can expand a business’s offering or they can support a business to streamline its processes.
Westpac has also signed the Australian Supplier Payment Code to help address cash flow challenges faced by small businesses by committing to pay all suppliers on time and work with them to improve invoicing and payments practices.
On the upside the report showed businesses that experienced growth in sales, profitability and productivity were those that were ‘innovation active’. By putting effort into significantly improving their operations or offering new goods and services, and considering the big picture rather than the day to day of running a business, they benefited.
For more on various past reports, see here.
Tips from SME Banking, Westpac Group
1. Make time for you and your business – our research found that over a third of small businesses are compromising their wellbeing, with the top three sacrifices being their personal finances, their health, and their connection with others. Being in your best health mentally, physically and emotionally will help your business thrive, particularly when it comes to making decisions and innovating. Learn to say ‘no’ to avoid spreading yourself too thin.
Use the New Year as an opportunity to take time out to think about the business. If you have a banker or accountant, organise a meeting and use them to help you develop a plan for next year. By stepping back to focus on your strategy and the future of your business, you may discover new sources of competition, new channels to distribute products or reinvent your product or service for a new market.
2. Set your sights on innovation – by putting effort into improvements and/or introducing new products and services. Highly digitalised small businesses are 50% more likely to be growing in revenue and earn 60% more revenue per employee than those with only basic digital engagement. If you don’t already have online, mobile and social channels to engage with customers, look at implementing this.
3. Diversify and access new markets – successful businesses have a larger share of international customers, with more than one in five of their customers based overseas. Small businesses which take steps to seize on export markets, enhance their products or services, or diversify their product or service offering to reach new customers may discover new sources of revenue and be in a strong position to future-proof their business.