Three tips to help small businesses survive in the seven-day economy
Sunday, January 10, 2016/
With the slew of public holidays and extended trading hours just passed, and more to come in late January, it’s a reminder that even small business needs to compete in a seven-day economy.
For larger operations there tend to be more resources available to deal with the heightened Christmas demand and penalty rates. But for small businesses, hiring more staff to deal with longer, busier trading hours isn’t always an option.
Recent Xero research revealed Australian small business owners struggle to take time off over the summer holiday period because 42% are the key decision-maker, 37% are the sole employee and 25% are just too flat out to switch off.
So with limited resources, small business owners need to master their prioritisation skills so they survive the seven-day economy.
Forecast your expected earnings
Opening longer hours needs to make financial sense. Have a look at how you went last Christmas period to determine how this holiday season might play out.
If you saw a significant uplift in sales or revenue, as many retailers do, then it’s likely staying open longer, or on more days, makes good business sense.
If you haven’t got data from last year, talk to similar business owners or your accountant. They would likely have some insight into what makes financial sense for your business.
Plan your staffing needs
Operating in the seven-day economy doesn’t necessarily mean working seven days a week. You need to get realistic on what you can and can’t do, and plan staffing needs around that.
Overtime and working on public holidays also attracts higher hourly rates, which can eat into your margins. Many small business owners choose to put in the extra hours to avoid getting lumped with higher staffing costs.
And while Prime Minister Malcolm Turnbull has flagged more flexible working conditions are on the way, they’re not here in time for this holiday season, which means small business owners need to be prepared to pay penalty rates on public holidays. They also need to figure out if it’s worth staying open during extended trading hours or on public holidays.
Watch the burnout factor
Doing the hard yards all year and then digging a little deeper to get you through the holiday season can leave many business owners feeling exhausted.
According to our research, nearly 60% of Australian small business owners haven’t taken a holiday in more than a year, and nearly a quarter haven’t had time off in over two years. This work around the clock mentality is concerning and increases the potential for burnout and mistakes.
Many small business owners are so self-reliant that they worry they won’t have a business if they stop working in it. This is where having a good set of advisors comes in, they can help build your operations so they can run, at least for a little while, while you’re switched off.
Chris Ridd is the outgoing managing director of Xero Australia.