While investing in your business during a pandemic may not sound very appealing amid cash flow issues, and late payments strains – channelling resources into getting ahead now could provide an edge over competitors as restrictions are further lifted. In this article, we will look at three key ways to invest in your business during the pandemic to make the most of available government grants and write-offs.
1. Staff investments. Redundancies and a rise in unemployment is rarely positive news for businesses. However, with the world in a state of flux, now could be the opportunity for you to look for talent gaps in your business and seek new employees. You may also have more candidates to consider for the role. Hiring now can also provide an opportunity to speed up the onboarding process.
For your existing staff, you may wish to use this time to help them upskill or prepare for changes to your previously established business model. With most of the world operating online, staff can take training courses or develop new processes, then return to work with new skills and greater knowledge about the business. As one part of its support initiative, the Australian government has also offered businesses with payroll costs of less than $10m an option to defer their payroll tax obligations for an additional three months.
2. Asset investments. In response to the struggles experienced by Australian businesses, the Australian Government recently announced a plan to increase the Instant Asset Write-off Threshold from $30,000 to $150,000 and to provide this to businesses with an aggregated annual turnover of less than $500m. Previously this limit was $50m.
While the initial announcement was to allow the increased write-off amount until 30 June 2020, this has been extended to 31 December 2020. This means if you have purchased (or are planning to purchase) assets for your business, you may be eligible to claim an immediate deduction for assets less than $150,000.
3. Investing in your business. With the business world currently experiencing major changes in everything from supply chain access to brick-and-mortar stores becoming obsolete, many business owners are finding ways to adapt their business plan and invest in new ways of operating.
Investing in your business in this way could include improving web design for your online store, honing digital marketing budgets, changing from retail stores to an online shop and warehouse, investing in new products, or researching new markets.
No matter how your business has been affected or changed in this time, continuing to develop and evolve as a business now will give you a head start in the future. By investing in the core aspects of your business – your staff, your assets and equipment, and your business plan – you can use this time to strengthen existing processes and avoid lagging behind the competition when the economy begins to recover.
* Helen Baker is a financial adviser, author, speaker and spokesperson for online finance information platform: Money.com.au