Businesses everywhere are under constant pressure to evolve and minimise the impact of COVID-19. Indeed, the stress may be coming from all directions. You might find yourself applying for government assistance for the first time as your business faces financial strain from a cash flow shortage. Alternatively, you might be forced to downsize or face the prospect of closing your doors for good. You might have pivoted your business or started to revamp your activities as the ease of restrictions flow through.

The pandemic has more than financial ramifications: it can take a toll on you and your employees’ mental health. It is more important than ever to know where the business is going by creating a cash flow forecast, and equally important to look after your mental health and that of your staff.

Identifying and Managing Mental Health Risks

Ongoing stress can lead to forgetfulness, indecisiveness, difficulty concentrating, short attention span, irritability, anxiety, depression, anger, insomnia, and increased risky or unhealthy behaviours (such as drinking, smoking, or overeating). Your employees will face stressors you have no control over, but there are work-related stressors you can help control. In fact, you are legally required to protect your workers’ mental health by providing a safe workplace, preventing discrimination and harassment, and protecting employee privacy.

Safe Work Australia has outlined a range of hazards factors in the workplace which can lead to health-related stress to consider:

• Increased demand on employees: Are they being asked to work longer hours for less pay during the pandemic?
• Poor support: Do your employees have mental health resources available to them? Do they feel safe to talk to you about their mental health concerns?
• Poor relationships: Are there conflicts among co-workers that need to be resolved?
• Poor working conditions: Is your workplace uncomfortable? Have you taken steps to make it as comfortable as possible? Is it safe from physical hazards?
• Poor organisation or lack of role clarity: Does everyone know what to do and how to do it? Do they understand the importance of their role within the company?
• Lack of transparency: Particularly during the pandemic, are you being upfront about the state of your company and where your employees stand? Do they feel like their jobs are secure?
• Traumatic events: Have there been workplace accidents or disasters?

By identifying the hazard risks in your workplace, you can take the steps to mitigate them.

Looking After Yourself and Supporting Your Staff

Whether you are a business owner or a manager, it is important to look after your own physical and mental wellbeing so you can be a pillar of support for your staff.

It’s important that your employees know you care and that you’re open and honest with them during this difficult time. Talk to them to see if there’s anything they need, and provide a list of resources that may be helpful. Beyond Blue offers a mental wellbeing support service with online forums and a variety of resources along with counsellors you can reach via phone or online chat.

As a business owner, you should also take steps to control what you can. While there is a lot of uncertainty, you can still prepare for the future by maintaining contact with your customer base, enhancing your knowledge, and preparing a cash flow forecast so you can have a clear picture of how the business is travelling.

The Importance of Preparing a Cash Flow Forecast During COVID-19

A cash flow forecast is an estimate of your cash flow to ensure you have enough money to meet ATO obligations, pay your employees, maintain your inventory, and more. With all the uncertainty amid COVID-19, it’s more important than ever to know what money you can count on and what you’re going to need for your business to survive the pandemic.

Simple Steps to Prepare a Cash Flow Forecast

There are various financial forecasting software to aid your business with preparing a cash flow forecast. Or you can follow the steps below to prepare a simple cash flow forecast spreadsheet for your business.

• Choose Your Forecasting Period: Are you forecasting for a month? Three months? With the ever-changing economic environment, you might find it’s more beneficial to forecast monthly, as it gets harder to predict accurately over longer periods.
• List All Your Income: Consider all sources of income including sales as well as any government assistance or grants you have right now. Review trends from previous periods and note down cash you believe will actually be in your account for the time frame you are forecasting for. Add up the total to get your net income.
• Note Down All Your Expenses: Your expenses are all your outgoings, like rent, ATO obligations, wages, bills, marketing expenses, bank fees, the list goes on. By adding up all your expenses, you will get your net outgoings.
• Cash Flow Running Total: To work out your cash flow position, you simply subtract the total net outgoings from your total net income. A positive cash flow indicates that you’ve got more cash coming in than you are spending. A negative cash flow represents the opposite, and you are actually spending more than you’ve got coming in. It’s a good idea in uncertain times to keep a running total from week to week or month to month, to allow you to pick up any positive or negative trends to examine further.

The Advantages of Attaining Cash Flow Finance to Reduce Financial Strain and Stress

Cash flow finance is one way to reduce business-related stress associated with COVID-19. Instead of waiting 30, 60, or even 90 days for your customers to pay their invoices, you can use cash flow finance to bridge the slow-payment gap and work through the challenging uncertainty of the pandemic. You can pay your employees, cover ATO obligations, and more, with a steady cash flow based on goods and services you’ve already sold and delivered.

With Key Factors cash flow finance, you can get your invoices paid in as quick as 4 hours in 3 simple steps:

• Invoice your clients and send us a copy.
• In as quick as 4 hours, we will advance up to 80% of the invoice value.
• We will credit your account with the remaining 20%, less any accrued fees, when your customer pays us.

Learn More About Managing Your Mental Health and Your Cash Flow

For more than 30 years, Key Factors has been helping small and medium businesses throughout Australia improve their cash flow. We offer personalised service with a simple and transparent process. Our cash flow finance facility also has no lock-in contracts, no minimum factoring volume, no property security, no quarterly audits, and no monthly admin fees. Send us the invoices you require funding for, and you will only be charged for what you use.

Taking care of your mental health has many facets, and reducing your company’s financial stress with cash flow finance can help. Contact us now to find out more and get approval in as quick as 24 hours.