As supply chains have become more complex and more globalised, businesses have developed a growing reliance on their suppliers. Despite this, suppliers in Australia and elsewhere are still forced to make do with long payment terms, and frequent late or non-payment issues. This is dangerous for everyone, including the paying business. Late or missed payments can have serious knock-on effects down the supply chain, causing liquidity issues and interfering with the operations of one or more businesses—which ultimately comes back to haunt the procurer. The more businesses are involved, the more can go wrong when cash flow is interrupted.
The holiday season is a critical time for businesses, particularly for retailers and businesses in their supply chains. In an effort to maximise the benefit of such a massive seasonal increase in demand, businesses need to temporarily boost their operational capacities to match. That means hiring temporary workers, purchasing additional and seasonally relevant stock, and implementing an advertising strategy to get as much attention from holiday shoppers as possible.
Cash flow management is both the most significant and most mundane issue keeping many businesses from making the leap from just getting by to thriving. The most commonly cited barrier to growth is a lack of finances, but a simple lack of funding can always be dealt with. An otherwise good business can normally attract the investors or secure the traditional loans it needs to realise its potential.
According to Australian tax commissioner Chris Jordan, businesses collectively had $26.6 billion worth of tax debt as of October 2019, the vast majority of which is due to tax underpayments by small and medium sized enterprises. Though they have already faced significant criticism over their aggressive tax repayment plan, the government is continuing to put more pressure on businesses to pay up. Despite their ongoing efforts over the past several years, they have been relatively unsuccessful. Tax avoidance and underpayment continues to be a growing problem.
For consumers, the holiday season typically begins with Black Friday, which is the day following Thanksgiving Day in the United States. Businesses, on the other hand, start thinking about the holidays much sooner. After all, they need to prepare well in advance to ensure that they can make the most of their most important time of the year.
The issue of employee retention is becoming increasingly important for businesses in Australia, New Zealand, and the rest of the developed world. Typical working conditions for employees have evolved over the past several decades to become more punishing for workers, even as the number of skilled workers relative to available jobs has declined. For businesses who rely on these workers, recruiting and training new personnel is time consuming and expensive, and can limit their ability to grow and to operate at their full potential.
In order to support steady growth, businesses need funding, customers, resources, and labour. Most often, businesses still struggle with getting the funds they need to support a long-term growth strategy. For many businesses, particularly those reliant on highly skilled workers, this is no longer the most urgent issue. With developed countries around the world facing an escalating skill shortage, finding and retaining qualified workers is becoming increasingly important for businesses to manage proactively.
In 2005 Alexis Ohanian and Steve Huffman approached Y-Combinator with the idea for a website called MyMobileMenu, and were turned down. The seed accelerator, though, encouraged them to come back with other potential ideas. Soon, they returned with greater ambitions; to create the front page of the internet. Just months later, their project, Reddit, would turn into a major success.
The issues of wage underpayment, missing superannuation, late payments, and tax underpayment make headlines on a daily basis. This isn’t because businesses are out to get the best of those they interact with. Rather, it’s usually because, when businesses run into cash flow problems, they have to make decisions about what gets funded and what doesn’t to make sure the business can both survive and grow. Often, employees, suppliers, or even the government, are left holding the short straw.
As the skill shortage in Australia and the rest of the developed world continues, businesses need to change the way they hire if they want to ensure that they can compete for the best talent on the market. This means engaging in more active recruitment, and building an attractive and eye-catching employer brand to appeal to workers.