The New Uncertainty – how to surf yet another COVID wave
At the end of 2021, things were starting to look better. It felt like COVID was receding. Vaccination rates were high and lockdowns were ending.
Experts like Westpac Bill Evans were actually forecasting 6.2% economic growth for 2022.
https://www.westpac.com.au/news/making-news/2021/12/bills-bites-2022s-eye-popping-growth-picture/
Then came the Omicron variant – and most of what we were looking forward to got washed away.
Lockdowns are still happening – just piecemeal rather than wholesaleโฆ
We might not be locking down whole Local Government Areas anymore. But we are being required to isolate until weโre tested – and those tests are taking up to a week to get processed.
That means there are still lockdowns – because weโre locking down individuals and their contacts.
More and more people are staying home – either because theyโre a contact or because they donโt want to get infected and lose work. This means that:
- Lots of people ARENโT going out and spending
- Thousands of businesses are getting shut down as their staff get infected.
And as more people stop going out – because they donโt want to be locked down for a week – they build new consumption habits. Unfortunately, those new consumption habits are NOT the sorts of habits that contribute to economic and business growth.
But because โthere are no more mandated lockdownsโ there is no more direct financial support from governments!!!
Navigating this hyper-uncertainty takes liquidity
Liquidity – the ability to pay short-term obligations.
If you can access funds to pay your bills through the cashflow peaks and troughs of these uncertain times, then your ability to recover is massively increased.
Access to affordable finance can provide that liquidity, through tools such as working capital, debtors finance and trade finance.
Not ALL government support is gone
While the handouts have mostly stopped, the SME Business Recovery Loan Scheme has been extended through to June 2022. It offers low-interest loans capped at 7.5% to SME businesses with a turnover of $700,000 or more AND itโs government-guaranteed, so it doesnโt require real estate as security.
Unlike a lot of other government funding, the SME Business Recovery Loan Scheme is as easy to apply for as a credit card.
https://www.linkedin.com/pulse/5-year-fixed-rate-government-funding-thats-simple-getting-cattach
You can use the finance to apply to a full range of business costs:
- Suppliers of stock/inventory/materials
- Suppliers of key services to your business
- Subcontractors
- Bills โ EFT Payment Only
Having the cost paid from the line of credit give you more cash in the business (liquidity) This can be used to pay rent and meet wage and other business commitments
What it will give you is a shield against the coming cash flow peaks and troughs, with the liquidity to keep operating.
Get finance when the big banks say no
Even if you don’t qualify for the SME Business Recovery Loan Scheme and the big banks aren’t interested in helping you, there could still be products to help you โsurfโ the current uncertainty.
Our specialty is helping SME businesses find the finance that helps them reach their goals – so if your cashflow is threatening your business future, then give us a call today.
When will this COVID wave be over? 4 numbers to keep an eye on and why
I recommend this article from The Conversation:
When will this COVID wave be over?
Martin Cattach
+61 407 477 555
Discussion on working capital and funding options:
https://calendly.com/martincattach/confidential-discussion-on-working-capital-requirements
