How One Small Business Has Been Able to Thrive Despite COVID 19
There is no denying that COVID 19 has been particularly difficult for small business owners. With forced lockdowns and tightened restrictions to prevent the spread of the pandemic, many small business owners have had to dig deep in order to overcome these challenges and stay afloat. Today, I want to shine a spotlight on a fantastic retail business in Brisbane Australia that has not only survived, but literally thrived despite the global pandemic.
Bio:
I want to welcome Jennah Grimsey to the show representing Vault Entertainment Pty Ltd. (Vault Games), located at – Lower Ground, 62 Queen Street, right in the heart of the city in Brisbane, Australia. Jennah is in partnership with her husband Dylan Shearer and their mutual friend Cassandra Varian. I first met Jennah, Dylan, and Cassie after they found and read my book Financial Foreplay® and decided they wanted to get some help to manage their cash flow and explosive growth.
Financial Foreplay® Highlights:
- Often, more sales does not fix cash flow problems, in fact, it can make them much WORSE
- High growth periods will highlight cash flow and working capital problems very quickly in your business
- Less than 30 days of cash reserves in the bank to deal with an emergency is very unsafe
- You should strive to have 4-6 months of cash reserves in the bank
- Top 3 lessons learned from coaching
- Cash flow is the #1 metric + you need to have enough working capital to fund the operating cycle and growth
- It never makes sense to drop prices in retail just for the sake of driving high volumes of sales (i.e. Black Friday sales)
- Supplier terms are critical – often an extra 2-3 weeks to pay is much more valuable than a discount on price
- Bank lending is very difficult for small businesses to get (even with the government backed guarantees offered during COVID19)
- Non-bank lenders are much more flexible and approve loans more quickly but the trade-off is much higher interest rates which much be factored into your costs
- Paypal is roughly 14% and Prospa offers a 24% interest rate – you need to adjust your business model to ensure you can cover these additional costs of doing business
- Top 3 impacts on Vault Games from having a coach during the past 12 months
- Net profit margin increased from 0.5% to 13%
- Cash flow up 750% with 2.5 months cash buffer in the bank for emergencies (and working towards 4 months of cash buffer)
- Allowed business to expand by moving to larger premises and pay for all leasehold improvement and fitouts with cash
- Took first fully paid vacation as owners (in four years of operations)
Do You Need Some Help to Get Your Cash Flow & Business Turned Around?
For those of you who are listening to this podcast and thinking “hey that is exactly where I’m in my business and I could use some help to boost my cash flow and also put more systems in place so that my business works without me”, please know that help is available if you are open to learning and willing to do the work.
Reach out now to speak with Rhondalynn about your suitability and readiness for business coaching:
🦉 Rhondalynn Korolak 👨🎓📢 | LinkedIn
https://www.facebook.com/financialforeplay
https://www.instagram.com/financialforeplay/
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