17th March, 2020
With coronavirus causing significant interruptions to industry around the world, your small-to-medium business clients need support now more than ever. Here are your top priorities to make sure your help gets where it’s needed.
While some larger companies may have a business continuity plan they can set in motion, chances are your smaller clients have been too busy trying to make a living to have prepared to that level of detail.
The reality is, few businesses have considered the potential impact of a massive pandemic such as the current coronavirus crisis and that creates a breeding ground for panic and poor decision making.
Accountants, bookkeepers and other business advisors are well placed to consider the impact this event will have on your clients’ businesses, and now’s the time to get proactive in communicating your expertise.
Here are eight practical ways that accountants can support clients through the coronavirus crisis and retain as many of them as possible for the future:
In any crisis, clients will look for help and someone to guide them through.
Business owners want to know that there’s someone there who cares about their business, so be sure to keep in touch by sending an email out to clients or jump on the phone to check in.
Let them know you will keep in touch and ask them to do the same. The sooner you know of any problems they’re facing during this time, the sooner you can help – the earlier you’re brought in, the easier it may be to solve.
Likewise, consider the ways in which you’re communicating with clients. If you’re used to face-to-face meetings, now’s the time to begin practicing virtual formats like video conference or even instant messaging.
Even a daily email to your database of clients won’t be frowned on if it contains useful information for business owners that are desperate for knowledge.
Review all clients for potential problems as far as you can.
You will probably know which clients are secure and which live hand-to-mouth. Contact those who are more likely to face problems and direct them to help in whatever form is available to them.
It is also a good time to perform a cash-flow position audit with your clients to take a temperature check of their business health, outlining any new contingency planning you might suggest given the current circumstances.
In times of crisis, it’s always easy to defer such things as doing accounts, but this will actually be the best time for clients to get on the case.
Start issuing reminders earlier and more frequently to get their accounts out of the way and plan the tax bills coming. If you can communicate this information in a way that demonstrates the value in them taking action, they’ll appreciate it even more when they see the results.
Fact is, if your clients are experiencing any downtime as a result of COVID-19, then it’s the ideal opportunity to get ahead on doing the books.
Across Australia and New Zealand, as is the case for most of the world, governments are rushing to provide stimulus to keep businesses like your clients’ open.
This stimulus, provided in the form of a variety of subsidies and tax breaks of various kinds, are critical for keeping the economy from slipping immediately into recession.
And that means you as a business advisor have an important role to play in sharing relevant details to your clients on what they’re eligible for, and the process they must undertake to receive it.
The best way to stay informed of the various stimulus packages across Australian and New Zealand tax jurisdictions is to follow the MYOB blog, as well as heading straight to the source at the ATO and IRD websites.
Sign up for added insights and business-critical news from MYOB.
Suggest to those clients who rely on supplies to contact their suppliers.
Suppliers should contact them if they have to resort to restrictions but it’s good to get ahead of the game. Advise they investigate alternative suppliers where required.
Supply chain issues are already threatening to derail businesses that import from countries significantly impacted by the pandemic. Advise clients to investigate the entire supply chain – do they know where their supplier gets their supplies from?
When cash is restricted, the temptation is to make late payments. This must be resisted, both for reputational reasons and for the health of the local economy.
Recommend your clients to check their debtors, and then check your own debtors. Review which clients are more likely to get into difficulty and suggest they pay your bill by instalments (if such arrangements are not already in place).
Now’s also the time to review your invoice processes to reduce the chances that you or your clients are left holding the bill. Best practice invoicing advice includes sending automated invoice reminders, as well as offering discount incentives for those who pay early.
Advise clients to review all costs and reduce discretionary and non-essential expenses as much as possible.
Fixed costs such as wages, rent, utilities, financing costs and tax liabilities not affected by a decline in sales need to be properly managed and, should things get really tough, hard decisions will need to be made.
At times like these, it pays to think laterally when it comes to managing costs, as unique solutions may end up becoming an important new feature of a business’s processes.
Some costs my be able to be spread across a longer timeframe, or other accommodations made to reduce the near-term burden on your clients’ cash flow.
The coronavirus crisis will change the way businesses and society works.
When the immediate crisis is over, businesses should consider how the economic landscape has changed for them. What has been learned? What do they need to do differently in future? What can they do stimulate growth back into their business and the broader economy?
After that, it could be worth suggesting some steps they can take to better protect their business from future interruptions of a similar scale.