New Zealand’s small businesses always face challenges: 70% of new businesses fail within the first five years. As a SME owner I’ve worked closely with small to medium enterprises (SMEs) for over 20 years. I know all too well the daily challenges of starting with a hope and a dream, trying to turn it into a successful business.

It’s perhaps never been tougher for our SMEs in our current pandemic economy. SMEs face a tight labour market, skills shortages, supply chain issues, higher borrowing costs, runaway fuel prices and high inflation. Business owners must be more flexible, open-minded, and adaptable than they’ve ever needed to be in the past.

 

The pace of change has accelerated in the pandemic

Covid has forced us to rethink how we work and where we work from. To me this is a positive. Presenteeism has all but disappeared: now it’s all about delivering outcomes. Any organisation that has not shifted to a hybrid way is a dinosaur and will soon be extinct. Staff will simply look elsewhere for greater flexibility.

The pandemic also forced companies to re-evaluate their technology investments, such as their enterprise resource planning (ERP) and customer relationship management (CRM) systems. Services like Zoom, MS Teams and Slack have become frontline necessities. Being mobile as and when required is the new norm.

In the payments world, the increase in online shopping has been explosive. At supermarkets, for example, the shift from instore to online was almost overnight. Projections of lifting online sales were hit within six weeks instead of the predicted eight to 10 years. Businesses have been compelled to raise their ecommerce game at pace. And considering how difficult it is to find staff, investing in anything that improves productivity and cuts down on human hours will pay dividends.

 

Despite all these changes, cash remains king

It doesn’t seem to matter what happens in the economy, for SMEs, cash is always king. Without healthy cashflow, a small business will not survive. For business owners, finding ways to invest in better cashflow can really pay dividends. These are my top recommendations:

· Make sure you have a great accountant or bookkeeper who is up to date on the latest technology tools.

· If you haven’t fully digitised the way you operate with your accounts and payments, find someone who can help you with this.

· Make sure payments can be taken and easily reconciled back to your accounting software.

· Offer customers plenty of options when it comes to payment.

We recently introduced an integration between Worldline and XERO with our Online EFTPOS payment solution. Fees are 1% (half what other payment methods cost) and allows your customers to pay their invoices directly via their mobile banking app. All it requires is customers to enter their mobile phone number. But the real bonus is the automatic reconciliation of the payment back into XERO with overnight settlement, compared to as long as a week with other payment types.

Online EFTPOS cuts fees in half, gets cash into your account faster, talks to Xero, and provides your customers with an easy payment option.

 

We’re not going back to normal

Will we ever go back to the way things were? I don’t think so. SMEs are the backbone of New Zealand’s economy – they make up 97% of our businesses and they contribute a quarter of our GDP and 28% of our employment. To continue to survive and grow in this fast-changing economy, SMEs must invest in new systems that support improved cashflow, productivity and digitalisation.

I joined Worldline in January 2022 with little understanding of the payment solution landscape and its deep complexities. What I’ve learned has showed me that the future lies beyond cards – digital identity and currency will be the new norm. It won’t take a decade or two for this change to arrive, like it did to see the back of cheques. Instead, change will be fast paced, within a couple of short years and in some case only months. Watch this space.