It is critical at this time to ensure that you are taking all the measures to make sure your business survives the current health and economic crisis. Live Real Estate Accounts shares their insight into how this can be achieved.
Firstly you need to make the hard calls, reduce hours, stand down or let go of staff. Remain in constant dialogue with your staff who are now more than likely working remotely and make sure they are using their time efficiently and have everything they need to feel supported.
What is your current cash position and access to cash for the next 3-6 months? You should know this.
Talk to your landlord if you need rent relief. Talk to your bank, there are provisions and offers that may be available to you and your business.
Your accountant and bookkeeper should soon or now be best friends! They both need to be across what govt subsidies you may be able to apply for. If you receive these subsidies, they should also be across how they are recorded through your accounts software, be they JobKeeper (eligible employees and business nominee), credits from current PAYG/BAS period or the NSW Government small business grant.
What does this mean? It’s about creating and putting in place the right structures and staffing to run a lean and efficient business, thus becoming a sustainable business that can grow in the right way during the good times, yet be more resilient during the tough times.
How do I do that and where do I even start? Firstly, what were some of the blockages that became apparent to setting up your staff to work remotely? For instance if you had to talk to your IT provider and used the acronym VPN, that’s the first sign you are not utilising the technology at your disposal.
Think about how your business is able to operate now under these restrictive conditions, who and what is actually required?
Consider your software – is it enabling better outcomes or have you just not understood the power it holds when used correctly?
Premises – can you now work out of a smaller footprint, as you now know that you could rotate staff on a work from home/office roster? Or, has staff working remotely opened the possibility of utilising more outsourcing or offshoring?
You need to understand the total cost of employment, which includes salary plus super, potential payroll tax (different by state), workers compensation, recruitment, on-going training, computers, workstations, staff amenities – you get the idea. To top it off, of the 52 weeks per year, factor in four weeks annual leave, 10 sick days and 12 public holidays (NSW).
Write up your company hierarchy, who are the staff, what are their roles and who do they report to? Dovetail this with a review of your systems and software, what does it do, who uses it (do they utilise its full capability?) and just as importantly, do you need it?
One word…subscriptions. You know you’ve got them but, what is necessary and what’s not?
Be more strategic
Have you ever heard the saying “measure twice, cut once”? Tradies live by it, making sure they are getting an exact cut to fit what they need. Take this approach with your business. Employing someone in a fulltime role, when fulltime hours are not needed should be outsourced! Don’t try and fill the role with other “stuff”. That’s not the right fit, outsourcing fits the job in the time required.
Growth – we don’t know what the banking environment will be like for acquisitions in the post Covid-19 real estate industry, so be strategic and look at mergers, equity splits or buyout periods.
Although, unfortunate as it may be there will be businesses that do not survive through this and opportunities will arise to purchase.
The key question to ask “is this a distressed asset or distressed owner”? You want the latter.
Now is the time to innovate, this does not mean get the latest software, it means change your business to become the real estate business of tomorrow!
Live Real Estate Accounts is an industry specialised provider, here to help real estate principals build sustainable businesses. If you or your accounts’ team need assistance or advice on any of the above or general accounts matters please feel free to contact our team for a free consultation.
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For more information on the above and our full range of tailored services go to www.liverealestateaccounts.com.au
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