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Innovation Stems From Collaboration – So How Can Your Business Get Involved?

Innovation is one of the pinnacles of good business practice. However, sometimes innovation isn’t a process that can be achieved by one person alone. In business, some of the best ideas and practices that your business might achieve could occur through collaboration.

Most businesses will have understood the impact and importance of internal collaboration between team members and already put into place tools to help promote this. However, what exactly does effective business collaboration look like?

Business collaboration is the leveraging of internal and external connections in order to generate ideas, find solutions and achieve common goals for your business. It can be done internally (through collaboration with your team), or externally (through the combined efforts of multiple businesses).

Many businesses are already seeing the benefits of remote collaboration within their teams, especially with regards to the time being saved and the increase in productivity.

Businesses may also find that learning opportunities are presented to their employees and team members through the interaction and collaboration with other businesses that could benefit them, with additional knowledge and skillsets gained throughout the process.

Even with many restrictions remaining in place that limit travel on both domestic and international scales, businesses are able to confer with remote workers and businesses through the assistance of digital technologies, thus enabling collaborative efforts to continue

As restrictions ease and businesses are able to engage with one another once again in face-to-face settings, remote collaboration tools can be used to facilitate inter-business collaboration from the ease of anywhere.

These include:

These tools allow businesses to work uninterrupted with individuals, clients and other businesses, as the distance between is no longer a major inhibiting factor to operations (if operations can be conducted away from the site). It can also potentially promote global interconnectedness for the business, as collaboration does not have to occur at a local or domestic level.

Your business might not collaborate with other businesses in exactly the same way as a business in the same industry. It’s important to know what might be the right form of collaboration for your business to benefit from it – and doing that will depend on what you may want to get out of it, and how long you may want it to last.

Alliance

This is known as the traditional type of business collaboration, usually involving two or three companies temporarily working together. They are able to reach a common goal by combining their resources and knowledge, which can be effective for businesses with knowledge/resource gaps that another business could temporarily fill.

Co-Opetition

Competitors can be great collaborators if used appropriately. Co-opettion involves collaborating with competitors so that businesses can share resources, avoid duplication of their work and generate new customers for all parties involved.

Portfolio

When one large business manages a broad collaboration with multiple smaller, external partners, this is known as portfolio collaboration. The main, central business sets the rules for the collaboration and maintains it, offering many of the benefits of an alliance but in a long-term form that generates more connections between businesses.

Community 

Simply put, community collaboration uses one of the greatest resources that a business may have at its disposal – the community. Essentially, businesses collaborate with individuals or other businesses that are within their community. This can be done via both the business community (e.g local business partnerships) AND the customer community (e.g. social media influencers).

Network

If a business knows of other businesses with similar goals and values that they want to uphold, they may instigate network collaboration. This style of collaboration means that the businesses may not necessarily be in competition with one another but, with shared interests can collaborate on mutually beneficial projects with access to one another’s resources and customer base.

Your business may choose to collaborate with other businesses through:

The rapidly changing and digitally-inclined business world means that businesses that don’t prioritise collaboration – both internally and externally – are likely to fall behind. Making the most of collaboration solutions and tools allows collaborations to be streamlined, which is beneficial to all involved.

If you are looking for advice on how to structure these collaborations or work out the best way to get involved with other businesses, you can plan out your way forward with our help. Start a conversation with us today.

Posted on 18 October '21, under business. No Comments.

Thinking About Becoming A Contractor? ABNs, Sham Contracting, Agreements And More…

Being a contractor offers flexibility, choice and more control over your own schedule. It also means that you have different responsibilities from other employees that you may have to fulfil.

For employers, knowing the difference between a contractor and an employee is a must. It can lead to costly penalties if the two get confused.

An independent contractor is someone who operates under an ABN and is not an employee of the company that they perform work for. They may also provide services to another person or business,

Sometimes an independent contractor may operate their own business and have many clients, in other cases the independent contractor may only do work for one company.

There are a number of factors that determine whether or not you may be classified as a contractor versus an employee. These can include:

In Australia, independent contractors often use the sole trader business structure when operating and conducting their business. Due to this, there is a legal requirement that you register an ABN for yourself or your business if operating as a contractor/sole trader.

Having an ABN is important. It identities you and your business to the government, and helps with tax and other business-related activities.

Not everyone may be entitled to an ABN (especially if they are considered to be an employee for the work that they are performing),. As a sole trader though, you are as you are considered to be starting or carrying on an enterprise.

For those who wish to contract you for your services, an ABN means that your clients will not be required to deduct tax from you. If you invoice an organisation without being in possession of an ABN, they are required by law to deduct tax at the highest rate that they can, as well as declare the income you receive from them through to the ATO.

If you’re operating as an independent contractor or sole trader, losing a chunk of your income to tax before you even get paid isn’t something that you’re likely to want to happen. That’s why having an ABN is important for you, to ensure that that doesn’t happen.

If your business is looking into creating a working relationship with a contractor, you need to be careful that you do not fall into a sham contracting arrangement.

A sham contractor arrangement is when a business (or individual) tells a worker that they are an independent contractor. It can exist even if the worker is treated like an independent contractor in some ways such as having an ABN and providing invoices like what a genuine independent contractor might have to do.

It’s illegal, and may be done knowingly by an employer to avoid taking fiscal responsibility for paying legal entitlements to employees. It is illegal to:

If you are concerned that you may be involved in a sham contracting arrangement, or are an independent contractor looking for assistance in ensuring that you are remaining compliant with your current obligations when it comes to tax, super or business, we can assist. We are also equipped to help you with dealing with an ABN.

Posted on 27 September '21, under business. No Comments.

A Restructure Only Means A Setback To Your Business, And Not A Closure – Here’s What The Reforms Could Mean For Your Business

With the demanding conditions that have plagued the retail industry over the past twelve months, business owners need to be aware of all the restructuring options available before it is too late.

COVID-19 has unfortunately resulted in reduced foot traffic, store closures, the accumulation of legacy creditors and significant deteriorations in working capital positions.

Even with the support of JobKeeper and other government initiatives buoying business ventures from early 2021 to now, many family and small businesses are sure to continue to struggle.

The Misconceptions Of Formal Restructures

The idea of restructuring your business or reaching out for external help can appear scary and often seen as something to be avoided at all costs. However, business owners are not on their own when dealing with the difficult conditions facing them in their short-term future.

No one wants to see a business fail.

That’s why there are always options available to businesses. However, the longer a company holds off on making a decision, the more the business and its available options will deteriorate.

If companies and businesses can act early enough, their options include informal arrangements and advice, voluntary administration, and new restructuring reforms for small businesses.

With the availability of these options and the right people involved, there is no reason why a financially distressed small business cannot survive the challenging times and thrive in the future. All companies experience some form of distress from time to time and often at no fault of their own. The ones that survive focus on cash, seek appropriate advice from trusted advisors at the right time and act further on it.

How Might A Business Survive Financial Distress

Using the voluntary administration process as a restructuring tool allowed Tuchuzy (a well-known retailer in Bondi) to successfully deal with legacy creditors, refocus on high margin product lines, and ultimately, the company continued to trade profitably.

The key to Tuchuzy’s restructure was a ‘light touch’ administration to minimise costs and disruption to the business and closely working alongside the director to ensure the proposal submitted to her creditors would be acceptable than an immediate winding up scenario (of which it was).

There is a lot of flexibility and breathing space afforded in the voluntary administration process.

The administrator can quickly reset the cost base by exiting unprofitable stores, reducing the workforce, and focusing on only buying and selling favourable margin products.

Even when a liquidation becomes necessary, the process can be reasonably quick, fair and transparent if run properly.

The secret is to overcome the general stigma accompanying restructures and approach restructuring experts early who will ‘unemotionally’ explain each available option and provide an impartial recommendation that aligns best with the individual circumstances.

What Do The New Small Business Restructuring Reforms Mean For You?

For a business with few creditors and a single location, the process of voluntary administration can be expensive and unnecessary.

Indeed, voluntary administration is often not appropriate for many small businesses due to associated financial costs and the hurdle accompanying a director relinquishing control.

The government has responded to this critique and offered an alternative. This alternative comes at a perfect time as directors are, once again, exposed to personal liability for insolvent trading.

The new small business restructuring (SBR) reforms offer a lower cost and far simplified restructure process, critical for small businesses to continue to trade after government assistance such as JobKeeper ceased in March 2021. The reforms add an essential new path that will assist many retailers.

Though there have been only a handful of SBRs to date, and their effectiveness to save businesses is yet to be appropriately evaluated, it is an option to explore in the right circumstances.

Critical Questions Your Business Should Be Asking

The COVID-19 crisis has put a severe strain on many previously successful businesses. Though the government and many advisors are attempting to ensure that they do not collapse, directors and business owners need to be proactive and engage early for them to work.

Often businesses approach liquidators and advisors at the point where their financial problems have become insurmountable, and a liquidation/shutdown is often the only option left. The timing of coming and asking for help can be the difference between a shutdown and the continuation of trading.

With proper preparation and an effective plan that considers all stakeholders, any business should be able to restructure and continue to trade.

If your answer to any of the below questions is yes, you should seek immediate advice from a trusted restructuring advisor.

  1. Am I currently losing money?
  2. Am I finding it hard to pay bills on time?
  3. Have I got old debts that I am finding hard to pay down?
  4. Do I need some breathing space?
  5. Do I have my ‘head in the sand’?

Posted on 6 September '21, under business. No Comments.

Finding The Right Partner For Business Is As Serious As A Marriage – And Just As Complicated

Making decisions as the owner of a business can be a world of difficult choices, but none so much as deciding that your business requires a partner. It’s a critical, strategic decision for the business that you won’t want to get wrong.

Approach your search for the right business partner to suit your business as you would a life partner. As a major legal covenant, a partnership is not unlike a marriage of sorts in the business world. It’s also something that you won’t want to rush into. A good partnership requires:

You might already have an idea of what you are looking for when it comes to a business partner, but it’s still important to identify key aspects of what makes a good one.

Critical Skills & Experience 

A candidate for a business partner should possess skills and experience that can be brought to the table which complement that which you already possess. They may possess strengths that you simply do not, which can make it easier to start, plan, grow and run a business.

For example, you may be a customer relations extraordinaire but struggle with the operational aspect of business development. That might be the skillset you look for in a business partner.

If the candidate for a business partner can also provide you with the resources and credibility for your business on top of sharing your vision, this can be a gamechanger. Those resources could include a secure business network, industry connections, client list or specific credentials and expertise that can add value to your business.

Values, Entrepreneurial Spirit & Business Vision

You will need to be able to communicate effectively with your partner to make decisions, set goals and drive the business forwards. Aligning your values and business vision with your partners will help facilitate your business’s development and growth without hindrance.

Minimise The Personal Intruding On The Professional

If your prospective business partner is facing serious challenges in their life, they may translate over to the business. While giving someone a chance to challenge themselves is an honourable act, running a small business takes focus, time and tremendous energy that they may not be able to afford to give.

Personal & Business Ethics

A partnership should be a mutual and trusting relationship. Someone who values honesty and practices good personal and business ethics should be at the top of your list. You don’t want to be involved with someone whose moral code does not align with yours, or who could get you involved in legal matters that may besmirch you and your business’s reputation.

Also, if you cannot respect your partner or they cannot respect you on a professional level, your ability to work as a team will suffer, and your clients will read into that as a lack of professionalism. Never partner with someone that you do not respect, or who does not respect you.

In the event that you choose or have chosen a business partner that is not right for you, make sure that everything agreed upon for the partnership was set out in writing, as breaking the partnership is no easy matter. With a lot of legal ramifications that you may face in dissolving the agreement at play, having evidence and a plan can save you plenty of grief.

For assistance with drawing up partnership agreements, business planning or simple advice on anything brought up here, you can speak with us.

Posted on 16 August '21, under business. No Comments.

The Pros & Cons Of A Partnership As A Business Structure

If you’re looking to go into business with someone, the chances are that you might be looking at using a business structure known as a partnership. A partnership is a type of business structure that is made up of two or more people who distribute income or losses between themselves and is a fairly popular form of structure amongst those looking to develop a business.

It offers ease and flexibility to run your business as individuals, eliminates the need to create a company structure and avoid reporting obligations. You’re also not going into creating a business by yourself, which can be an added bonus for some and reduces some of the initial financial burden and uncertainty of the setup.

Just as there are advantages to choosing to set up a partnership, one must also examine the disadvantages.

A partnership generally exists between two or more parties, so disagreements in management may occur, and decision-making may never be truly equal. It can be difficult to add or remove partners into and out of the partnership, and adding more partners can make the partnership more complex to manage.

Partnerships also generally do not receive access to many government grants (barring special exemptions).

A partnership business structure may be the structure for you to employ as they possess the following key elements:

There are three main types of partnerships that you may have come across in your own research. Each one has advantages and disadvantages that you may want to take into account when considering what would be the best suited to your situation.

A general partnership is where all partners are equally responsible for the management of the business. For any debts and obligations that may be incurred by the business, each partner has unlimited liability for them.

A limited partnership is made up of general partners whose liability is limited to the amount of money that they have contributed to the partnership. Those involved in this style of partnership are known as limited partners who are usually passive investors without a role to play in the day-to-day management and running of the business.

An incorporated limited partnership is where the partners involved in this type of partnership can have limited liability, but at least one general partner must have unlimited liability. If the business cannot meet its obligations, that general partner (or partners) become personally liable for the shortfall and debts.

Each state and territory has different legislation and regulations that must be abided by when setting up a partnership. Learn what is legally required from you prior to setting up your partnership, or discuss with us what you may be obligated to do.

Posted on 27 July '21, under business. No Comments.

Choosing A Structure For Your Business: The Co-Operative Explained.

Sometimes you might want to set up a structure where you will share in the spoils with everyone that deals with that structure.  There is a specific type of structure for this and it is known as a Co-Operative.

A co-operative business structure (or co-op) is a legally incorporated business entity that is designed to serve the interests of its members. Co-operatives may be profit-sharing enterprises or not-for-profit organisations.

A cooperative business serves members by providing goods and services that may be unavailable or too costly to access as individuals. There are two types of cooperatives that businesses can be set up as.

Distributing cooperatives are able to distribute any annual profits to members of the cooperative. They are required to share the capital that they make, and members of this type of cooperative must own the minimum number of shares specified in the co-op’s rules.

Non-distributing cooperatives cannot share their profits with members of the cooperative. All profits must further the cooperative’s purpose, and the cooperative may or may not issue shares to the members. Members may be charged a subscription fee if there is no share capital

Some popular cooperatives business structures include:

Posted on 5 July '21, under business. No Comments.

Planning Out Succession For Your Family-Run Business

Family-run businesses form an essential part of the economy. Tradition, success and history along with their unique dynamic can create a thriving business that many may wish to see continue.

 

 However, as with any business, the conversation about succession and how to continue the business into the future needs to be had. 

 

With only 1 in 4 family-operated businesses considering their approach to succession formally, succession in a family business is one of the greatest viability risks to the actual business and needs to be addressed accordingly.

 

Every family and family-run business is unique, and every transfer or succession of a family business will also be executed differently. If you are thinking about what your family business’s plan is for succession, you may want to consider keeping these critical factors in mind:

 

 

A succession plan for a family business needs to be created to move forward and should detail all of the actions you intend to take (including the steps involved with both management and ownership succession). 

 

It needs to be flexible, adaptable and ready to evolve, as businesses (as well as families), change over time. Your succession planning process should be transparent and understand and align with the goals you have set out for the business’s further development across the generations. 

 

The most effective succession plans:

Posted on 29 June '21, under business. No Comments.

Boosting The Business With A Free Resource: Your Customers

More and more Australians bought local products during the past year and rallied behind smaller businesses, which buoyed many shops that may have otherwise struggled to stay afloat. 

To create this kind of loyalty and support it’s crucial to develop and maintain a strong connection with your customers. 

If you are a small business, this is a vital aspect of business management that you will want to have occurred to strengthen customer relationships. 

Make The Customer Feel Special

Customers want to feel special – you can achieve this by approaching each customer as an individual rather than as a customer per se. Making the user interactions tailored to suit each customer’s specific needs/usage of your products will enhance the relevance and improve the authenticity of the interaction. Your customers will feel heard by your business and seen.

Let Your Customer Feel Heard

Always ensure that the customer feels heard – if the customer has a complaint, treat it the same way that you treat a good review, and respond accordingly. This builds trust with the customer and future customers that you will hear them out, and act the best you can to assist. 

Reward Customer Loyalty & Strengthen Connections

Go above and beyond for your customers – if you’re a small business, you can use the closer connection you may have with your customers to your advantage and offer additional loyalty discounts, recommendations, and phenomenal customer support. 

Follow Up With Your Customers

Follow up with customers (new and current) to ascertain reception of products and services, spearhead a proactive approach to appraisals and determine if a poor customer experience has been had. Following up allows customers to feel acknowledged while also granting you access to potential data that you may not have received otherwise. 

Connect Via Social Media 

Ensuring that you remain actively involved on your social media for your business with your customers should increase interaction. With many looking to online platforms to browse products, leave reviews and share favourite products via social media, it makes sense to turn your social media platform into a way to make your brand shine. Actively engaging with customers, responding to comments and questions, and directing your brand’s narrative are great ways to use social media to strengthen your connection.

Your Existing Customers Should Come First

Prioritise the customers you already have over the accrual of potential customers. If you’ve already got an established customer base, one of the best ways to maintain it is to keep them happy. You don’t want to risk losing them during the growth of your business due to less attention and more subpar customer service. The best way to maintain customer loyalty is to ensure that you can meet their needs, follow up with their requests (to the best of your ability) and satisfy their customer service needs. 

Posted on 23 June '21, under business. No Comments.

What Can Engaging A Business Adviser Do For You?

Feel like your business is stuck in a rut? Unable to solve a problem that you know is going to cost you in the long run?  It might not be financially tanking, and it’s highly likely that your revenue stream isn’t down, but if you’re not sure what direction to take, it could also mean that you need a fresh pair of eyes to take a look at particular issues that your business is facing to deal with them.

Business advisers can be engaged across many fields with specially focused advice or strategies to a specific area (such as accountants, business bankers or commercial lawyers) or be a business adviser who is dedicated to considering the overall goals and long-term ramifications of your business’s strategies.

A business adviser can be hired on either a one-time basis (to deal with one-off problems your business is set to face) or on an ongoing basis to provide continued support.

Suppose you’re only looking for a particular solution to a problem. In that case, one-time advice from a business adviser can be an easy and cost-effective solution to solve that particular problem. However, suppose you’re looking for long-term ongoing support that’s backed by years of experience and a perspective that’s looking to preempt these issues. In that case, ongoing advice may be more appropriate for your needs.

Engaging a business adviser can provide your business with fresh ideas based on an objective analysis of your business’s current performance and situation.

As an example, contracting an accountant in a business adviser role means that you are looking for strategic and financial advice like profitability improvement, tax planning and advice regarding business performance.

An adviser who can offer timely and relevant advice to your financial situation can make a huge difference to your business in the long run.

If you’re looking for assistance in plotting out the financial future of your business, you can come and speak with us. We’re well-equipped to assist you in mapping out your business’s plan for the future, so start a conversation with us today to see how we can help.

Posted on 14 June '21, under business. No Comments.

Planning For Your Business’s Future For Next Financial Year

With the end of the 2020 financial year rapidly approaching this month, many businesses will be reflecting on how they managed to navigate and meet the challenges of a turbulent time (namely, the COVID-19 pandemic).

By taking what they have learned, what worked and what failed, businesses should be able to plan for their future for the next financial year and understand how to take their learnings from the previous year forward with them to create preventative strategies and coping measures.

A good business plan recognises these periods of change as opportunities to innovate, challenge the business and engineer a plan that allows them to take chances but remain safe at the same time.

Planning For Your Business’s Financial Future This Financial Year

We are here to help you plan out your business’s future for the next financial year, including how to prepare financially for any eventualities, what might be the best path forward to deal with potential or existing debts, and what schemes or grants your business could be helpful to your business. Contact us for an appointment today.

Posted on 9 June '21, under business. No Comments.

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