Australian startup and SME founders have revealed in a recent survey conducted by MYOB that their first port of call when their business runs into financial difficulty is their accountant. The MYOB monthly snapshot survey regularly quizzes a section of the company’s 1.2 million strong database of clients about topical issues related to business conditions, and almost half of those surveyed said that accountants were the professionals they looked to first and trusted most to help them through tough financial times.
Interestingly, the snapshot survey also found that 62% of businesses with an annual revenue of less than $75,000 have had to dip into their personal savings to cover costs of the business and keep them running. This is not uncommon for early stage companies, but worrying nevertheless that Australian businesses are struggling to reach profitability.
“The survey highlights that accountants are invaluable to business owners regardless of the industry or the size of business,” says MYOB CEO, Tim Reed. “Rather than just being called upon at tax time, they are actually a constant source of financial advice throughout the year, helping businesses grow and remain profitable.”
According to the survey, 86% of businesses with one to five staff members offer flexible working conditions, the most popular being flexible hours (59%) and time off for family or religious commitments (58%).
“Businesses with 1 to 5 staff members are the most likely to offer the option to work from home,” says Reed. “This is good to see because flexible working can increase business productivity, reduce turnover and improve job satisfaction”.
Feedback from survey participants around the Productivity Commission’s recent proposal to introduce more flexible arrangements for the retail and hospitality sectors has been generally well received by the community. Those surveyed agreed that a reduction in weekend penalty rates would bring costs down, with 23% saying it would allow them to employ more staff.
MYOB’s survey results support Startup Daily’s findings earlier this year that startups are increasingly turning to their accountants and book keepers for advice when it comes to managing and growing their business. In fact, in a survey conducted by Startup Daily, the two main areas where founders were most likely to seek advice from their accountant were succession planning and financial growth, including profitability.
Although it may be reasonable to assume that a succession plan is not a critical thing to have in place as a startup, research shows the opposite, especially if you are wanting to sell your business in the future. The key to a successful succession plan all begins with keeping your financial affairs in check.
A buyer or acquirer of a company will need to be confident about the numbers that you are presenting to them, and getting your accountant or book keeper using a product like MYOB to keep all of this reporting in one easy-to-access place will go a long way in helping you do this.
Growth and diversity are often the keys to a successful sale for most companies. When a potential acquirer can see that revenue has been increasing over a period of at least two years, it acts as a great signal that there is potential for further growth. Diversity is all about having a range of different clients and a solid base of customers, not just a handful of key clients that you are reliant on.