Small to medium businesses in Australia have had a tough year, with nearly 80% struggling to manage cash flow, according to new data from Commbank.
While many of these businesses have strategies in place to tackle the issue—around 85% to be exact—some of those solutions aren’t exactly sustainable. Over a quarter of business owners reported having to dip into their personal savings or forgo paying themselves a salary just to keep things running.
“Small business owners are clearly taking proactive steps to manage cash flow, but strategies like using personal savings or not drawing a salary can take a toll in the long run,” said Rebecca Warren, CBA’s Executive General Manager for Small Business Banking.
The survey found that declining revenue was the biggest culprit behind cash flow issues, making up 35% of cases. Low cash reserves accounted for another 30%, while seasonal fluctuations contributed to 27%.
“Running a small business is a constant balancing act,” Warren explained. “From managing customers and employees to dealing with suppliers, there’s a lot to handle. And the economic challenges of the past year have made it even harder for many Australian SMBs to maintain healthy cash flow.”
To support businesses, Commbank has launched a free cash flow management course, designed in collaboration with Lifelong Learning at the University of New South Wales. The course is open to all Australian small businesses, regardless of whether they’re Commbank customers, aiming to provide tools and insights to navigate these challenges more effectively.
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