1.Interest rates are at an all-time low. What effect do you believe this will have on a small business?
With interest rates at record lows, there is an opportunity for small businesses to borrow funds to invest in their growth. Whether that be to bring on more staff, spend more on marketing or possibly to access the Small Business Instant Asset Write Off by purchasing new equipment and claiming an immediate tax deduction for assets costing less than $30,000.
2.We have recently seen the introduction of Single Touch Payroll [STP]. How important is it that business owners embrace technology rather than shy away from it?
Like it or not, we are now operating in a digital age, and it is essential that business owners keep up with changes in technology or risk being left behind. In some cases, for example, STP, business owners are left with no choice but to embrace technology to meet their obligations as the Government pushes forward with its plan to move more and more functions into an online environment.
Change can be scary, and it is always tempting to stay in our comfort zones and simply maintain the status quo. However, by embracing technology, we can bring new opportunities to our businesses to help them grow and prosper.
3.How does McPhail & Partners keep up with technology changes?
For us, it really comes down to a combination of connecting with the right business partners and having a team with curious minds. Technology is developing so fast that it’s impossible for a small business to keep on top of everything. We have strong partnerships with our IT and Software providers who keep us abreast of significant developments that can positively impact on our business.
We also encourage our team to investigate ways to improve our internal processes and procedures where they feel we could benefit from new technologies. For example, the team is currently looking at utilising some of the Xero Apps to streamline the expense claim process and integration with our payroll system.
4.What would you say are the most significant risks to business at the moment?
Risks will vary from business to business and from industry to industry. For example, in the retail space, those businesses with physical shopfronts face the challenge of more people buying online rather than in-store. The hospitality industry faces reputational risk as social media can have such a powerful impact, both positively and negatively, on their businesses. Cash flow is always a challenge for small businesses, particularly those in the building and construction industry where significant resources and finance are required up-front.
It is crucial for all businesses to understand the risks specific to their circumstances and put plans in place to minimise the impact these risks can have.
5.What are the biggest pitfalls when selling a business at the moment?
I think for someone selling a small business, the biggest challenge is harnessing their emotions and looking at things objectively. A potential buyer is looking at the purchase as a business decision and will look at the financial performance, market position and perhaps synergies with their existing business.
They don’t see the years of blood, sweat and tears that have gone into developing your business, or all those late nights at the kitchen table doing the BAS returns or paying the accounts. With all that effort that has been put in to build the business, it can be difficult to set realistic expectations of its true market value, which can make the negotiation process extremely stressful and challenging.
6.Small business is the cornerstone of the Australian economy. Do you believe there is enough support for a small business owner; affordable support to help them navigate running and growing a business in today’s times?
There is a lot of support out there for small businesses, but business owners might not be aware of the resources at their disposal. Having a strong relationship with your Accountant and, if relevant, your bookkeeping is essential as we can help to guide and advise you.
Additionally, the Government has some great resources available for free online which can assist with running a small business such as Business Victoria (www.business.vic.gov.au), the Fair Work Ombudsman (www.fairwork.gov.au), the ASIC (www.asic.gov.au) and even the ATO (www.ato.gov.au).
Outside of these Government resources, there are also other organisations that businesses can join, such as the Victorian Chamber of Commerce and Industry (www.victorianchamber.com.au), to assist. It is also a good idea to join your local council business group where you can network with other local business owners to share ideas and hopefully build your referral network.
7.Five years from now, what can we expect from McPhail & Partners?
As part of our ongoing succession plan, we will see some changes of the next five years as we look to position the business for hopefully another 75 years of success. We will still maintain the values that we pride ourselves on, such as honesty, integrity and professionalism so that we can continue to provide our clients with the level of service they expect.
We are always looking at ways to improve our service offering to meet the needs of our clients, which we will continue to do. This will come from a combination of engaging with new technologies, keeping up to date with legislative changes and also developing new skills and offerings to help clients navigate through their own financial journeys.
8.We live in an App era! There seems to be an App for everything these days even budgeting and rounding up Apps to help save money. What’s your advice about using these Apps? Can they be useful when it comes to budgeting?
There are several great apps out there that can help you track your finances and manage your budget. The challenging part is having the self-dedication to update and review them regularly and to hold yourself accountable for the results.
These Apps do serve a purpose but should be used as part of the bigger picture of managing your overall financial objectives.
9.McPhail & Partners has recently moved offices. ‘They’ say that moving can be one of the most stressful experiences known to man! Having been through the process, what advice would you give to others that are considering relocating?
DON’T DO IT! Just Kidding!
Honestly, it was a stressful process at times, and we certainly learnt some lessons throughout the move. In hindsight, there were some things we did really well, but equally, there are some things we would have done differently if we had to do it again. The key items I would highlight for anyone looking to move would be:
-Have a clear plan of what you want to achieve but be flexible and open to change as the process unfolds
-Set a realistic budget and don’t overextend yourself
-Communication! There are so many moving parts, and there needs to be clear communication between all the stakeholders, so things run smoothly
-Ask for help – you can’t do everything yourself (especially if you are also running your business) so build a team and engage others to help you
-Enjoy it – despite all the stress and long hours involved there is real satisfaction in seeing your vision for the future of your business come to life in front of you