By Anthony O’Brien for Money Magazine, March 2021
More than 12% of small businesses closed in 2019, with 293,260 of them exiting stage left. This closure level is hardly a shock as countless challenges threaten to sink our businesses every year and 2020 was even tougher, thanks to restrictions, lockdowns and border closures. Yet failure rates could skyrocket further in 2021 and beyond.
Business turnaround specialist Adam Smith, a director of professional services firm Aurecon and a chartered accountant, says that while the federal government suspended the insolvency laws for financially distressed businesses until December 31, 2020, the number of businesses at risk is expected to rise.
“Australian businesses that were already suffering from liquidity issues before the pandemic have only received temporary relief, with the prospect of recovery for many companies still in doubt,” he says.
With JobKeeper due to end on March 28, businesses will need to be smarter, nimbler and more innovative than ever before to stand on their own two feet again.
“It could be blood on the streets,” warns Simon Winter, a certified practising accountant at Raine & Horne who sells hundreds of businesses each year. Apart from JobKeeper’s demise, he also expects the end of the moratorium on business insolvencies to begin to bite.Continue reading “Six ways to help turn around a failing small business”