Negotiate, and then renegotiate: More COVID-19 survival tips for businesses


I was thinking I wrote that list of COVID-19 business survival tips a month ago, but I checked, and it was last Monday. Since then it’s been non-stop phone calls and the last round of office visits, talking to freaked-out staff, trying to keep the businesses in a form that will live to see 2021.

Every time I got off a plane, I’d get a swarm of texts on some massive new announcement purpose-built to fuck up our industry even further. The events business really was the first to go on the fire.

It’s quite the experience to have the thing you do literally declared illegal.

Then the texts would move on to escalating employment carnage news, and messages from people I’ve known for decades watching their hard-built businesses burn.

On the upside that list seemed to help some people. I spoke to a small biz friend last night who said “I did all the things and it saved about $40,000 of my cash” and it’s nice to have these small rays of sunlight amid the grinding trench warfare.

So, the topic for this article, is did that survival advice actually work in reality? And some new tips and info I’ve learnt since then. Because some of last week’s tips now feel like they were sent via telegram from some distant sepia-coloured era.

Cashflow forecasting

It gave me some grim amusement to find how much easier cashflow forecasting is when you can take out one big variable. When your revenue is $0.00 across five businesses, you get a pretty clear picture. It’s like stocktaking food in the life raft.

Our wage bill is about $500,000 a month. None of us have that sort of cash down the back of the couch, so we had to put a plan together to see how much we can afford, and how long we can support people.

After we can’t support them, and it seems likely we’ll get to that point before things return to normal, what are the costs of mothballing the warehouses and re-starting the businesses? You’ll need to put that amount aside now. It’s mainly rent for us, but think hard what else you need for yours.

The best long-term thing you can do for your people is to be in a position to employ them again. Don’t emerge unable to get things moving again.

Some details of our cashflow-wrangling adventures.

Negotiate everything

We went into hyper-hustle mode to negotiate every single ongoing expense. Here’s how that went.


We don’t have a lot of leases, but the bank was really good with those. One phone call had all payments suspended for three months, to be reviewed after that, but basically all good until we get revenue again.

The banks have also set up helplines for anyone affected by COVID-19. If you can’t pay your mortgage, or you have crippling credit card debt, or you’ve had to let staff go and they need info on how to survive, the contact details are here.


This kinda sucked in that we paid a massive BAS like good corporate citizens about two weeks before things went south. Damn. Anyway, the ATO is fine with future payment plans and, hopefully, we’ll get a moderate amount of stimulus cash next month.

Basically, everyone who calls the ATO for a payment plan gets it now. Do it now if you haven’t.


Don’t get me started. I’ve written another article on this situation. Basically, landlords are operating in a mental universe where there is no virus. They would like us to bear all the costs of shutting society down. Our one nice landlord (who is also a client) gave us a four-month rent holiday.

The rest said we can delay some of the payments until later in the year but then they must be paid back in full, not a penny less. So we’ll emerge into a harsh recession with double overheads. Seriously fuck those guys, urgent government action is required.

Negotiation: That was last week, this is now

Anyone prudent already spent last week cutting the sort of deals I’ve described above. But the game has changed, and we’re operating under new rules.

I wrote of a last-Monday deal with one of our landlords that seemed a win at the time. That was before our industry went from minimal work for three months, to none for about six months, after a cascading series of (necessary) government announcements.

We’ll be going back to that landlord to let him know he needs to share more of our pain. Don’t be ashamed to return and tell people you need more, because things are now a lot worse for reasons entirely outside your control.

Don’t do this to small suppliers and freelancers. Do it to large suppliers, institutions and people who you know have a strong balance sheet and should frankly be doing more to help.

When you’re going to the special business owner income of $0, as my business partner and I will be for the next year, it really sharpens up your willingness to ask people for further deals.

Bugbear: the number of people I’ve heard say “but, I’ve worked long and hard” as they resist any revenue cutback while the economy burns… Shut. The. Fuck. Up.

All your rules are gone now, we have all worked long and hard and it is not some magic credit that can be carried forward into this new reality.

Government stimulus: What’s in it for you

This is changing day by day, so here are some thoughts as of Monday, March 23.

Government stimulus deals fall into two categories: good, and not-as-good-as-they-seem.

Good things

Good stimulus things are direct payments of cash to keep your business alive.

Caution: beware of media headlines saying “$50,000 for SMEs”. You only get the $50,000 if you’re paying that much tax for that quarter. If not, you get less (minimum is $10,000) so don’t put the whole fifty in your plans. And you won’t get anything until you file your next BAS. That’s April 28, a very long time away in coronavirus cash-burn weeks. Talk to your accountant.

Our accountant is being quite, good sending out short summaries of what these deals mean for each of our businesses, within a few days of each announcement. If your accountant isn’t doing that, tell them they need to lift their game, this is an emergency.

Whatever you get, you need to spend this on employing staff for longer. That’s your obligation to every single one of us. I know you can spend it on your company car payments, and the government can’t stop you, but if you do, understand that you are no better than a shoplifter, and I will hunt you down and kill you.

Not-so-good things

There are lots of announcements that make a nice headline but are basically kicking the can down the road.

Let’s look at the employment-killing burden that is payroll tax. Victoria has a good deal, refunding all SME payroll tax from this financial year. Queensland’s deal, which superficially looks like good news, is just a deferral of payment till next year. Big difference. More double overheads for next year. Read the fine print.

There’s instant tax write-off of capital investments up to $150,000. Honest to god, if you buy a $150,000 capital item now you’re basically advertising that you’re so loaded that you will be kidnapped and eaten by ravenous mobs. Now is not the time.

What about zero-interest loans, should you get one?

I’d really advise against that. That seductive word zero makes it seem free. It is not free. It’s not like your tax payment plan, which helps with existing debt. New loans are more debt that you’ll have to pay back as your business limps into the radioactive wasteland of next year’s economy. This is real last-resort stuff.

This article was first published on Motivation for Sceptics.

NOW READ: COVID-19: Nine tips for business survival

NOW READ: Government announces a $66 billion second coronavirus stimulus: What’s available to small businesses, and how do I claim it?


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