As enterprise models and client fee habits quickly shift within the COVID-19 period, there has by no means been a extra opportune time for companies to pivot their strategy to funds.
With a brand new spike of COVID-19 occurring in Victoria and components of New South Wales, Australian companies should be ready for any future crises (well being or in any other case) that might trigger additional disruption.
For a lot of organisations, funds techniques are an necessary a part of this equation.
A distinct sort of disaster
Whereas some similarities have been drawn between the affect of COVID-19 and the worldwide monetary disaster (GFC) in 2008, we’re presently navigating an entire new surroundings.
In truth, one of many largest variations between right now and the peak of the worldwide downturn in 2008 is the expansion and class of the digital world. In lots of instances, the digital world can complement or completely substitute facets of the bodily world in methods not doable greater than a decade in the past.
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For instance, we’re now seeing gyms migrating their companies on-line.
From a enterprise funds perspective, one of many principal challenges of right now contains the flexibility to monetise items and companies amid rising well being issues about contact funds.
Whereas funds usually fall into the too-hard basket, there are some easy measures companies can undertake to enhance and crisis-proof their funds techniques.
1. Leveraging extra environment friendly fee constructions
For companies dealing straight with prospects, one of the crucial efficient steps to take is connecting to the New Funds Platform (NPP).
Companies encouraging prospects to pay by way of the NPP are seeing large advantages, together with decrease transaction prices and extra environment friendly, seamless funds.
The opposite benefit is the platform’s PayID functionality which helps companies establish who has paid them, permitting for simpler reconciliation of funds.
Regardless of being essentially the most environment friendly fee technique accessible, many companies proceed to depend on conventional fee techniques akin to bank cards and PayPal.
Latest figures from the RBA reveal the NPP is steadily taking market share from different fee strategies. Each the value and quantity of NPP transactions in Australia has elevated considerably in contrast over the previous 12 months — by 166% and 120% respectively.
Getting on the NPP is so simple as making a PayID utilizing an electronic mail deal with or telephone quantity. Companies also needs to apply paying by way of the platform with $1 transactions to make sure it’s optimally arrange for purchasers.
2. Take into account providing reductions for full or partial upfront funds
By a sooner funds system enabled by the NPP, companies can settle for partial funds from prospects earlier than the supply of a superb or service.
In an unsure financial local weather, implementing partial billing is a technique companies can successfully minimise their publicity to loss, as a few of the prices of supplies or supply are already coated.
Companies can also encourage upfront and on-time funds by prioritising service supply or providing an enhanced service expertise or low cost to prospects. For our half, we’re seeing extra companies provide partial and upfront funds to prospects and anticipate this to proceed.
3. Accompany funds techniques with the precise accounting software program
Having the precise accounting software program for your small business is much more necessary within the present surroundings, given many companies can now not afford a prolonged debtor listing.
With the ability to establish the place every fee is from and apply good administration on debt is essential to enterprise sustainability throughout this era, particularly as inflows and outflows fluctuate based on buyer demand.
As an illustration, we’re seeing a rising pattern throughout many sectors of micro-wholesaling the place companies make smaller, extra frequent transactions with suppliers.
4. Supply prospects diversified fee choices
Regardless of the expansion of contactless funds, it’s nonetheless necessary for companies to have a diversified system catering to quite a lot of funds habits.
The most recent RBA figures present the NPP has a protracted option to go earlier than it’s thought of an on a regular basis various to playing cards, processing simply 5% of the variety of card transactions in May 2020.
Though it’s arduous to foretell how lengthy the present interval will final, companies who take the time to put money into the precise fee techniques are giving themselves the perfect probability of success in weathering this disaster and past.
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