Launching a startup? Small business owners share recipe to survival in 2020
For many small business owners, a key ingredient to staying afloat in 2020 has been accessing professional advice. As new research shows, a whopping 74% turned to a financial advisor for support amid coronavirus shutdowns.
The recent QuickBooks COVID-19 Recovery Report found expert help was especially essential to millennial business owners, with 94% saying they reached out to an advisor like an accountant or bookkeeper during the pandemic.
And by far their biggest reason for seeking out this form of financial assistance was to interpret and apply for JobKeeper and other government stimulus programs (41%). Small business owners also used their advisors to figure out strategy (17%), find new revenue streams (12%), and manage cashflow (11%).
The report was based on surveys with over 500 small business owners in June.
Intuit QuickBooks Australia’s Vice President and Country Manager, Natira Drayton said these findings highlight the importance of financial advisors, especially in times of crisis.
“Advisors are the hidden heroes supporting the Australian small business community through this pandemic, often burning the midnight oil to help their clients access vital government stimulus and improve cashflow,” she said.
“They’ve also gone above and beyond, providing a huge amount of emotional support, which is commendable and inspiring at this time of need.”
More than a quarter of respondents said their advisor was a source of emotional support.
Tips for new startups and entrepreneurs
The report also looked at advice that small business owners would give to others looking to become their own boss. The top recommendation was to pay for an accountant or advisor to assist with business finances, with 48% agreeing this would be a wise money move. In fact, 23% more Aussie small businesses are paying for that support right now, compared to pre-COVID.
But besides seeking out a professional, respondents also offered a few other tips:
Test the waters first
Rather than diving headfirst into running an enterprise full time, a number of small business owners recommended biding your time and making sure you’ve built up enough knowledge and cashflow first.
Nearly half of respondents said it’s a good idea to start your business as a side hustle while keeping your day job (46%). Around a third also advised getting small business management training or a qualification (33%); gaining experience in someone else’s business (32%); and waiting until you have sufficient savings to see your business through slower months (31%).
Learn from others
Small business owners also recommended turning to others for guidance. Out of the survey respondents, 42% encouraged those starting out to consult other small business owners, while 34% said it’s useful to access government support and advice.
Know your customer
Finally, 38% of small business owners advised conducting market research to find out more about your customer base. After all, knowing your customer well means you can respond quickly to their needs, and the pandemic has proven just how essential that is. Whether it’s brick and mortar stores migrating onto eCommerce platforms or cafes moving to contactless delivery, businesses who pivoted their products to meet shifting demand found it improved their chances of survival.
But of course, one of the hurdles that small businesses face is lack of available funding. As another recent report from Amazon found, more than a quarter of small businesses saw this as their biggest challenge to innovation and growth.
So whether you’re still in the planning stages of starting your own business, or you’re already a few months in, it pays to consider where you can acquire extra finance. To get started, check out our guide on how to fund your startup, or scroll down below to compare a few business loan options.
Bear in mind that with many of these loans, you’ll need to meet eligibility criteria, such as trading for at least 6 to 24 months or having a minimum annual revenue of anywhere between $40,000 and $500,000.
Page last updated October 17, 2020
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