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“Sure, people get sick, so do businesses! If you are in Hospitality, Tourism, Transport and Education, your business already has the symptoms, it’s now up to you to work out treatment,” says Ginette Muller of thesolvers.com.au.
As the impacts of Coronavirus are felt worldwide, Australia is caught up in the economic fall out of the likely pandemic. As a nation, China accounts for a third of our exports, 1.4 million Chinese Tourists spend $11.5bn  in our economy, and over 200,000 students  access our world-class academic facilities so much so that Australia’s ability to withstand global downturns has largely because we have aligned with the Chinese economy. 
“What do you do if you can’t get stock? Or suddenly fewer people are dropping in to buy things on their way to a tourist spot? It’s not just the big exporters and importers impacted.
Says Ginette ”It stands to reason that a downturn in China will have a significant impact on the Australian economy and small and medium businesses will be caught up in the storm. Therefore they need to start to plan for a downturn in Chinese trade. And other counties are effected too!”
Ginette warns ”It’s not just online businesses who will be impacted either. Firms in the supply chain like trucking companies are going to have significant problems if they don’t manage the drop off in trade.“
“It may not last long, but how many businesses can take another slow month or two after the Christmas break and the awful summer we just had?’
“Businesses large and small that are dependent on services and goods to or from China, or are reliant on tourists, should already be looking at options.”
Thankfully for business owners, there are strategies that can be adopted to protect directors who need to buy time when under financial distress. The Federal Government passed laws which allow directors of a financially distressed business a ‘safe harbour’ to turn around their business free of the worry of being personally pursued for insolvent trading conditions.
“Safe harbour is a strategy that a business can turn to, but there are conditions. The business owner must have their accounts and records in order, get expert help from a professional, determine if the organisation is viable and then develop and implement a restructuring plan.”
“This strategy provides directors time to take stock. You can negotiate with suppliers, engage with customers, refinance debts, diversify service offerings, target new markets, reassess fixed costs and plan a way to ride out the storm.”
“It’s cliché but prevention is better than a cure” said Ginette.
To learn more about a safe harbour strategy or to reassess your business and risk, contact www.thesolvers.com.au and we will connect you with experts who can help your business today.
A safe harbour video is available at: https://insolve.com.au/what-is-safe-harbour/