SMEs urged to negotiate payment discounts

The recent announcement by the Reserve Bank to leave the cash rate target unchanged at 4.35 per cent came as welcome relief for SMEs grappling with inflation and rising living costs.^[i] Any increase in interest rates can quickly reshape the financial landscape for SMEs. 

Moneytech CEO Nick McGrath acknowledges that Australian small business owners have proved to be a very resilient group of people. “SMEs have been really copping it on all fronts but generally holding up well,” said McGrath. “Over the past twelve months, they’ve had to deal with inflation, and supply chain issues, while interest rate increases have impacted their business lending and home loans.”

McGrath identifies cash flow, primarily impacted by debtors stretching payment periods beyond agreed terms, as the big issue for business in 2024. SME business owners and also consumer borrowers are increasingly turning to the non-bank lending industry to make up cash flow short-falls.

“Debtor payment periods are just one of these storms impacting business at the moment, with debtor payment days blowing out at the big and small ends of town,” said McGrath. “30 to 60-day invoice terms are dragging out to anywhere between 90 and 120 days. That’s a lot of time for SMEs to wait to get their money after delivering goods or services.”

To overcome cashflow issues, a finance facility can give tight budgets some much needed breathing room. SMEs using finance to deal with slow invoice payment and high cost of living pressures are advised by McGrath to put their finance to work by getting a better deal, instead of simply using it just for cash.  

Negotiating terms with suppliers is just one of the ways better cash flow from a finance facility can improve the bottom line. According to McGrath, SME business owners should ask suppliers for a payment discount for quicker payment.

“SMEs are paying their own suppliers in 30, 60, or 90 day terms, if you pay cash on delivery or a 14 day term, often a supplier will give business owners a discount of anywhere between three to five per cent of the cost of goods sold. The discount generally far outweighs the cost of finance, so make sure any capital from finance is put to good work.”

To learn more about finance facilities to assist and grow your business, visit www.moneytech.com.au.

Mimecast, an advanced email and collaboration security company, published its Q4 Global Threat Intelligence Report today, revealing extortion campaigns, geopolitical threats, and attacks on small and medium-sized businesses (SMBs) to be among the greatest cybersecurity risks to cybersecurity defences. The report analyses the threat landscape for Q4 2023 and offers actionable recommendations on how to improve cyber defence. Key findings from the report include: 

Ransomware threat evolves to effectively hold victims hostage

Ransomware and breach-for-ransom campaigns continued to grow in Q4 2023, with one of the larger groups, ALPHV Blackcat, compromising more than 1,000 victims with ransomware and data extortion and reaping more than $300 million in ransom payments by the end of the quarter. Attack strategies have evolved from crypto-ransomware (where attackers encrypt data and hold the decryption key) to breach-for-ransom campaigns (where attackers steal sensitive data and threaten to release the sensitive information unless paid) to double- and triple-extortion strategies (where attackers combine tactics for more dire consequences).

Garret O’Hara, Senior Director – Sales Engineering APAC said: “We blocked nearly 250 million attacks against Mimecast-protected systems in January – a new record high for the business, highlighting the sheer scale of the threat.

“It’s striking that in a busy election year, with 76 countries due to go to the polls, geopolitical tensions have increased, leading to more cyberattacks, with over 100 hacker groups claiming participation in the Israel-Gaza conflict alone. It is deeply concerning that nation-states are using cyber operations to gather intelligence on rival governments and attack critical infrastructure and information systems. Organisations must act to ensure they and their employees are protected against this continuing uptick in malicious activity. Our new report offers threat-specific countermeasures and general recommendations to help combat threats.”

Small and Medium businesses pay BIG price

Users at small and medium-sized businesses encountered more than twice the number of threats — 31 and 32 threats per user (TPU), respectively — than users at large companies, who saw about 15 TPU in Q4.

The larger risk for SMBs is due to a greater share of employees in critical roles; targeting those users results in a higher level of threats per user. In addition, because SMBs rely on credential-based cloud services for much of their operations, attackers are more focused on credential theft, a common phishing goal. A striking 97.3% of Australian businesses are small to medium enterprises, according Australian Small Business and Family Enterprise Ombudsman, making the threat particularly pronounced in the Australia.

Threat actors become less attached

In Q4, for the first time, the average user was more likely to encounter a malicious link than a malicious attachment. With users ignoring the overwhelming volume of email messages blocked as either spam or impersonation (phishing), attackers are shifting from delivering payloads as malware to sending links to malicious sites, which then deliver the payload.

Fujifilm is celebrating its 90^th anniversary with the launch of the company’s first ever Global Purpose, ‘Giving our world more smiles’, underscoring the company’s commitment to bring diverse ideas, unique capabilities and extraordinary people together to change the world.

The new Global Purpose also reflects the role of Fujifilm Group in bringing smiles globally through innovative products for the past 90 years and the aim for the entire Fujifilm group to guide employees, customers and the community toward a shared future.

To see a short video on Fujifilm’s new Global Purpose go to: https://holdings.fujifilm.com/special/90th/en/#video

Fujifilm Australia CEO Richie Matoba said, “Fujifilm’s 90th anniversary celebrates the rich diversified history of our brand and our journey through a wide range of industries and products that have enriched and changed countless lives. It is also a commitment to the future, with the belief that our product range and proprietary technologies will be successful in giving our world more smiles.”

Fujifilm Australia CEO Richie Matoba

Since its foundation, Fujifilm has been dedicated to providing products and services based on its advanced and proprietary technologies to bring smiles to people’s faces. In achieving sustainable growth and with its employees as the driving force, the company aims to propel the Fujifilm group toward realising the new Global Purpose as an embodiment of shared aspiration.

 
President, CEO and representative director of FUJIFILM Holdings Corporation Teiichi Goto added, “Through our new Global Purpose and by combining the Fujifilm Group’s strengths in technology and the wisdom of our diverse and talented workforce, we will contribute to solving social issues through all of our businesses.”

To mark its anniversary Fujifilm has also launched a dedicated 90^th anniversary website which showcases the company’s history since 1934 and reflects the wide ranging public discussions it has had about its role in society and how it can contribute to create a brighter future.

Fujifilm’s new Global Purpose is one of its most unique and wide-ranging initiatives to date as it encompasses all of the company’s divisions, including medical systems, photo imaging, recording media and electronic imaging.

The new Global Purpose has roots as far back as Fujifilm’s 2006 corporate philosophy change when the company began aligning its business expansion and the addition of diverse products globally. It also aligns with Fujifilm’s global CSR plan which emphasises sustainable development as a part of Fujifilm’s Sustainable Value Plan (SVP) 2030.

Whilst Fujifilm’s “Value from Innovation” remains as the company’s corporate slogan, there has also been a key Corporate Philosophy Update which the company describes as, “an embodiment of aspirations propelling the group toward realising its purpose.”

Matoba added, “There are some key messages that form a strong thread running through our new Global Purpose. These include Fujifilm’s resilience through crises, diversification and proactive initiatives, our transition from photographic film to our Second Foundation with focus on imaging, healthcare, materials and business innovation and our unwavering commitment to contributing to societal challenges whilst maintaining a needed and trusted status in our corporate culture.”

The timing of the new Global Purpose Establishment is no coincidence as the company aims to unify employees, customers and the community worldwide on its 90th corporate anniversary year whilst setting the vision for its 100th anniversary.”

Richie Matoba concluded, “Our goal is for Fujifilm to continue providing innovative value and achieve sustainable growth towards our 100th anniversary and beyond as we realise our new Global Purpose. To that end, we will continue to take on the challenge of learning from the past in order to shape the future.”

To see a short video on Fujifilm’s new Global Purpose go to: https://holdings.fujifilm.com/special/90th/en/#video

For more information on Fujifilm’s new Global Purpose and its 90^th anniversary go to: https://holdings.fujifilm.com/special/90th/en

You’ve probably heard the phrase ‘cash flow is king’ and with tough economic times for many Australian SME’s never has this been more true. Cash flow is what separates a thriving business from one struggling to stay afloat.

It encompasses all revenue generation, operational expenses and investment activities. Businesses that manage their money efficiently ensure more cash is entering the business than leaving it which enables them to grow and expand.

Get a Cash Flow Plan

With the start of 2024 it’s important SME owners have a plan in place for their cash flow so they can invest in new growth opportunities, expand operations, acquire assets and explore strategic developments. Cash flow allows owners to realise their business goals but it’s important to have an accurate forecast.

Accurate cash flow forecasting is the foundation of sound and comprehensive management. It involves predicting future cash inflows and outflows so owners know when to expect periods of surplus and shortfalls and can implement strategies to navigate the challenging times.

Where Cash Flow goes wrong

It’s a tough time for SME’s at the moment. Rising overheads, supply chain issues, high staff turnover and rising interest rates – it’s no wonder many are struggling with the day to day running costs. 

Some of top mistakes small businesses make when it comes to cash flow include

• Failing to manage payment delays
• Expanding too quickly without enough working capital
• Poor inventory management
• Failing to generate new sales leads

Get Help

Whilst many businesses strive to reduce the time between invoicing customers and receiving payments to ensure positive cash flow this can become tough when some customers take up to 60 days to settle accounts. 

Invoice financing, which is widely used by business owners in the US, UK and Europe is becoming more popular here in Australia and allows a business owner to unlock the cash that’s tied up in their unpaid invoices, providing a line of credit secured by the Accounts Receivables ledger. The financier gets paid when the debtor makes payment so there are no repayments to be made. Typically, businesses can access up to 90% of the sale value of an invoice whilst continuing to offer credit terms to customers.

It’s an option worth looking into if you are a B2B business.

Have a Back Up Plan

Lastly it’s important to have a contingency plan in place. Know what resources are available to you if unexpected challenges come your way. Some businesses have an emergency cash reserve to cope with economic downturns or supply chain disruptions, others have assets they can quickly convert to cash, and others feel secure having an invoice financing facility in place.

Whatever challenges lie ahead for your business in 2024 going into the new year with a focus on maintaining positive cash flow puts you in the best position for growth and achieving your goals.

Contributed by By Angus Sedgwick, CEO of OptiPay

Change fatigue employees in Australia are looking to avoid risky career moves and limit their exposure to workplace disruptions as they enter a new year of work, according to Gartner, Inc.

Gartner’s latest Global Talent Monitor survey data, collected between October and December 2023, revealed Australian employees’ intent to stay with their employer increased to 37.8% from 35.4% in 3Q23. While overall business confidence increased for the first time in 2023 to reach 43.1%, discretionary effort declined from 17.5% to 16.5%.

“Employees experienced a multitude of enterprise changes last year, including return to work mandates and technology disruptions,” said Neal Woolrich, Director, HR Advisory in the Gartner HR practice. “Change fatigue, combined with the rising cost of living and a softening labour market in Australia has many employees taking a cautious approach to their next career move.”

Gartner’s 4Q23 survey data reflects the growing need for constancy this year, with stability entering the top 10 drivers of attraction for Australian employees, up three places to ninth spot (see Table 1).

Top 10 Drivers of Employee Attraction and Attrition, Australia, 4Q23

Source: Gartner Global Talent Monitor Survey, 4Q23 

While longer tenures can be an advantage for employers, disengaged employees can affect both productivity and workplace culture. Gartner recommends organisations review their Employee Value Proposition (EVP) to identify the employment attributes most likely to foster engagement and address change fatigue.

Reengaging the workforce

According to the Gartner survey, while engagement levels remained steady in 2023, less than one-quarter (24.3%) of Australian employees consider themselves to be ‘highly’ engaged. Most (73.9%) state they are only ‘somewhat’ engaged.

“Organisations need to be aware that traditional retention strategies won’t work in the current environment,” said Woolrich. “Leaders need to balance pay discussions with effective non-compensation EVP components, such as respect, manager quality and career progression to retain employees.”

Woolrich added, “Employers also need to think about the whole person, not just the employee, as they customise their EVP. It’s essential to understand what employees need and want from their role. An agile approach that provides a rich portfolio of experiences, support and opportunities will be key to maximising productivity and engagement.”

Addressing change fatigue

Change fatigue is fuelled by more than just the number of changes experienced by an employee, according to Gartner research. A new project, task or process can erode trust, impact wellbeing and contribute to a lost sense of purpose if communication from management is not clear.

“Employers must prioritise their relationships with employees to foster strong psychological safety and trust,” said Woolrich. “When employees understand that there is room to try, fail, reset and try again, they will soon start to thrive in an environment of change.”

Gartner recommends two-way dialogue between leaders and employees, which can significantly increase change success and psychological safety. Furthermore, when managers effectively allocate resources and goals to accommodate change, their teams are more likely to sustain workforce health through the disruption.

The shift towards a digital workplace presents both opportunities and challenges for modern businesses. As companies increasingly adopt cutting-edge technologies to enhance efficiency and scalability, they must effectively balance these advancements with the human element to maintain an engaging and productive work environment. The challenge for many businesses is in integrating technology in a way that supports, rather than supplants, the human workers. This approach is key to enhancing employee experiences while sustaining long-term business growth and success in a digitally dominated era, according to Logicalis Australia.  

Scott Brown, head of employee experience, Logicalis Australia, said, “Artificial intelligence (AI) and other advanced technologies are shiny new toys that have the capacity to revolutionise how we do business in the modern age. However, it’s critical to understand that human workers will remain essential to business success in many ways. Business leaders can’t afford to let the employee experience fall by the wayside as they embrace new technologies. Instead, they must find a way for the two elements, technology and human, to work in tandem.

“Leaders should focus on strategies that foster employee engagement and well-being in a digitally-driven environment. Implementing user-friendly technology that simplifies workflows and enhances collaboration is key. Equally important is creating digital spaces that support social interaction and personal connection, preserving the essence of a traditional office environment. This can be achieved through virtual team-building activities and digital platforms that encourage open communication and inclusivity.”

Incorporating technology in the workplace significantly enhances connectivity among workers. It facilitates seamless communication and collaboration, regardless of physical locations. Technologies like private 5G and cloud-based solutions provide robust and flexible platforms for employees to interact, share ideas, and work on projects collectively. This level of connectivity both improves efficiency and fosters a sense of unity and teamwork, crucial in today’s often dispersed work environments.  

Technology-driven connectivity facilitates more dynamic and inclusive meetings and brainstorming sessions, bridging gaps that physical distances might create in a remote or hybrid working environment. Advanced video conferencing and collaborative online tools ensure real-time sharing and editing of documents, making teamwork more interactive and productive. Supporting technologies can also be tailored to suit different workstyles and preferences, ensuring all team members, regardless of location, have equal opportunities to contribute and engage. This works to enhance productivity and strengthen the bonds between employees, fostering a more cohesive and supportive workplace culture.

Ultimately, the goal is to create a digital workplace that is efficient and scalable while also being nurturing and human-centric. This approach will lead to enhanced employee satisfaction, productivity, and overall business success. Effective digital workplace management also involves personalised experiences for employees achieved by leveraging data analytics to understand individual work patterns and preferences. This is especially valuable as tailoring digital experiences to meet these unique needs promotes a sense of belonging and increases engagement.

Scott Brown said, “By leveraging these technological advancements, businesses can create a more connected, engaged, and productive workforce. With additional tools like AI-driven analytics, teams can gain insights into work patterns, improving decision making and project management. The integration of smart technology leads to a more adaptable, innovative, and responsive workforce, that aligns with the evolving needs of the business landscape.”

A human-centric digital workplace is not only about the tools and technologies employed; it is also about how these elements are integrated with a deep understanding of human dynamics to improve employee experiences. This approach is essential for fostering a thriving, engaged, and satisfied workforce.

Responding to reports around proposals to change negative gearing, Master Builders Australia says this is a timely reminder as to why proposed changes to negative gearing have been dropped in the past.

“Prior to the 2019 election Master Builders had modelled ALP policies to change negative gearing and capital gains tax arrangements,” said Master Builders Australia CEO Denita Wawn.

“The policies would have seen a fall in the number of homes being built, thousands of job losses and billions of dollars wiped off the value of residential building activity.

“Fast forward to 2024 and we’re now in an even worse economic and housing environment with renters and mortgage holders bearing the brunt of rapid interest rate rises and high inflation.

“Across the whole housing spectrum, the common constraint is supply. In order to put downward pressure on housing inflation and high rents, we need to build more homes.

“The Henry Tax Review, Productivity Commission and Reserve Bank of Australia have all said curtailing investor incentives like negative gearing and capital gains tax discounts reduces housing supply rather than improve it.

“With the current downturn in new building approvals and investments in new housing, why we would take a sledgehammer to investors including Mums and Dads beggars’ belief.

“The priority of the Federal Government should be on ensuring the objectives of the Housing Accord are fulfilled and our target of building 1.2 million homes is achieved.

“This means doubling down on reducing the cost and time it takes to build, increasing the building and construction workforce, and investing in critical infrastructure to make land “build ready”,” Ms Wawn said.

Booking more than two weeks ahead, asking for last room availability, and choosing fares that offer like-for-like credit options with cancellations. These are just some of the top travel hacks that helped the savviest businesses shave hundreds of thousands of dollars off their travel spend last year, as revealed by Corporate Traveller.

Flight Centre Travel Group’s flagship SME travel management business has lifted the lid on the best travel tactics that have helped some of their most strategic business customers save more than 30 per cent on corporate travel over 2023. And with a recent survey revealing that 91 per cent of SMEs would continue to travel regardless of economic pressures this year^[1], Tom Walley, Corporate Traveller’s Australian-based Global Managing Director, says these tips could put thousands back in the company coffers.

Tom says: “Simple but effective hacks such as booking airfares a month out from the travel date can alone save a company up to $200 on a single one-way domestic ticket. And given there was a 28.7 per cent increase in ‘revenue passenger kilometres’ to 67.6 billion last year within Australia^[2], we know Aussies are spending more and more on travel.”

Corporate Traveller reveals the top travel hacks to save from its savviest customers:

1. Ditch the myth of last-minute travel deals and ensure you book those flights more than two weeks out from the travel date.

Last-minute travel deals are a myth, says Tom, with the cheapest airfares now typically available at least two weeks out from the travel date, but booking as soon as six months in advance would see the largest savings. He further adds that organisation is key when it comes to nabbing the cheapest deals.

Tom says: “Last year one of our clients gave themselves the goal of improving their annual advance purchase by 20 per cent, by simply shifting 33 per cent of their bookings from within two weeks to at least four weeks in advance. By doing so, they reduced their average trip cost year on year by $137 per booking, for a total savings of $120,000 over 800 bookings.”

Airlines offer their cheapest rates on any given flight more than 14 days out, as their algorithms work to seat availability, and as seats get snapped up, the price of the remaining spots tend to increase. Additionally, says Tom, Corporate Travellers’ savviest clients frequently book on the quarter or half hour to nab cheaper fares, with companies that opt for a flexible departure time able to secure the best deals.

Tom says: “Remember that many travel hacks that worked years ago have also changed. Travellers used to think travelling on a Tuesday, for example, would guarantee the best fare. But now, by tracking flight prices, booking in advance and being flexible with meeting times at the destination, you’re far more likely to reap savings.

“But, as is the nature of business travel, advance organisation of meetings and events is not always as easy as it may sound. Travel Management Companies exist to help corporate travellers secure the best deal for those unavoidable last minute travel scenarios.

2. Maximise travel value adds by signing up for a travel programs 

Alongside utilising a travel management partner such as Corporate Traveller to help you secure the most competitive rates, Tom says many of their business customers also enjoy increased value in their travel through travel programs. Corporate Traveller’s SmartStay program, for instance, offers exclusive hotel deals, with add-ons including free breakfast, late checkout, and upgrades.

Tom says: “Travel management companies are typically able to secure better deals because of their buying power and their strong relationships with suppliers. By signing up to hotel or airline newsletters, our clients have also nabbed special coupons and offers.

3. Book a flight that offers the best terms and conditions for changes, credits or cancellations

Not all airline Terms and conditions were created equal, Tom says, and by purchasing a flight that lets you get a full credit that can be used on the same economy flight type has the potential to save you thousands in the long run when those corporate travel plans change. Smart travellers and bookers should always check the terms and conditions of a fare, as some economy tickets may appear to allow flight credits in the case of cancellation, but it may come with restrictions.

Tom says: “Some flight credits only allow you to purchase a flex fare, which means in some cases you’ll end up paying hundreds of dollars more. Others hit you with hefty fees for changing flight dates.

“Our smartest customers opt for flights with good credit and refund policies.”

4. Encourage a carry-on luggage culture

During domestic travel, encouraging staff to fly with just carry-on luggage for short trips can save a company significantly over the course of a year. Some of the more budget-conscious businesses are educating their travellers about what they can pack and how to do it efficiently, leading to savings of up to $90 per airfare.

By taking travel-sized toiletries, separating electronic devices and carrying your laptop separately, Tom says the carry-on luggage limits have proven to be ample on two-to-four-day trips.

5. Always ask for last room availability

Hotel rates vary wildly based on the time of year and city events, says Tom, but by utilising ‘last room availability’, Corporate Traveller’s budget-conscious customers get a guaranteed set contracted rate at the hotel they partner with. Last room availability is a contract between a company and a hotel that ensures a hotel sells their rooms to the company at a contracted price, regardless of how many rooms are left or whether a rare event, such as a concert, has inflated prices.

6. Package your flight, hotel and airport pick-up and drop-off service

Some business travellers make the mistake of booking each component of their travel separately in the hopes of snagging a better deal, but by bundling the trip, their customers usually pay the same, Tom says. This means less time spent organising a car rental or a rideshare, less hassle, and less room for error – after all, for busy business travellers, time is money.

Tom says: “Our top customers know that time is also money and that with bundled deals that include airport transport, the booking and travel process is seamless.”

7. Select hotels that are in close proximity to the CBD, transport and meetings

Businesses that booked hotels in walking distance to major amenities and meeting locations also clocked major savings last year by cutting down on rideshares and even restaurant expenses. By booking a hotel in the city centre, Tom says corporate travellers enjoyed more dining options and less need for a rental car or taxi.

Tom says: “With Australians projected to spend a record $1.77 billion USD on ride-hailing apps this year^[3], our savviest customers are realising a well-located hotel can reap major annual savings.”

Intuit QuickBooks, global financial technology platform​ in Australia, has announced a new cloud-based offering and the most robust version of QuickBooks Online, built for small to medium sized businesses. Using artificial intelligence, this new solution will serve up insights and patterns that help growing companies better run their business. 

“QuickBooks Online Advanced provides an advantage for growing and more complex businesses at an attractive price point, filling a gap not yet met in the market,” says Damien Greathead, Accounting and Advisor Group Lead at Intuit QuickBooks Australia. 

“We’ve expanded our platform capabilities to serve customers who are self-employed all the way through to those with larger workforces and a high volume of transactions. As these businesses grow, many are faced with the lack of an affordable solution and often adopt software that is both expensive and too complex for their needs. QuickBooks Online Advanced addresses that void to help power their prosperity.”

QuickBooks Online Advanced boasts all the features of Intuit’s most popular small business software solution, QuickBooks Online Plus, as well as enhanced services to make it the perfect fit for growing business owners.

QuickBooks Online Advanced key features include:

• Automated workflows: Invoices can be sent through pre-set approval flows before they’re sent. Reminders and approvals can be set for transactions like invoices, payments, or deposits, dependent on individual requirements. 
• Custom roles and permissions: Access to sensitive information can be restricted and information to transactions such as deposits, sales, expenses, inventory or reports can be customised. 
• Automatic backup and restore: Data is frequently backed up and stored securely, allowing the user to easily restore books to a previous point in time, providing peace of mind.

Additional product capabilities will be added to the platform in the near future — giving users even more great benefits to anticipate including features to increase administrative efficiencies, enhance reporting and benchmarking, and ease expense management.