From bushfires to a global pandemic, 2020 has been an unpredictable year. Despite the prevalence of uncertainties in the business sphere, some recurrent issues can be avoided. Chief among these is poor cashflow. ASIC reported that the top reason businesses became insolvent was due to inadequate cash flow or high cash use accounting for 49% of reports.[1]

Small business owners often have to remain flexible and adapt quickly to successfully run their company, all of which can result in unplanned for expenditure or cash flow shortages. Here we look at some of the issues and opportunities that can crash your cash flow.

Poor planning

While it’s tempting to get stuck straight into the excitement of launching a new business, a proper roadmap will help ensure long term success. A business plan should include profit forecasts, start up costs, taxes and fees, operational costs and also leave room for emergencies.

Understanding your financials will tentatively indicate whether the business is likely to turn a profit, how long this is expected to take, and if it will generate enough income to meet the operational and start up costs. It will also give you an insight into whether your business can cope with unexpected expenses.

Unexpected delays

Starting a new business is synonymous with experiencing numerous delays and changes that impact the ability to create an income, while taxes, costs and fees begin to mount up. These can be completely out of the owner’s control and range from website development blowing out to business permits and liquor license red tape taking longer than expected.

If it’s not possible to generate income, the next action should be to avoid additional late fees from suppliers. Using buy-now-pay-later payment options like UnLock, can open up lines of credit for 30, 60 and up to 90 days for as little as 1.50% interest to help owners and operators manage their expenses until they can open their doors.

Staff turn over

Finding new staff can be an expensive process if recruiters are involved and the process of posting jobs, reviewing applications, interviewing candidates and upskilling new employees all takes time and productivity from the business. Research on the costs of employee turnover varies, with some studies claiming that businesses could spend 6-9 months of someone’s salary to find and fully train their replacement.[2] 

Investing in quality staff and a culture that will keep them with you is important. Small expenses now in the recruitment process and to ensure staff satisfaction can go a long way to future stability and success. Beyond Friday drinks and other bonding exercises, look to provide staff with opportunities for growth and purpose in their roles.

Over-reliance on clients

If your business is making a large part of its profit from once source, you’re probably reliant on them for your survival and at risk of going under should they find a new partner. Look to diversify to not only grow your business, but ensure it’s able to stand the test of time.

New opportunities

Some problems are ‘good’ to have. From increased demand for a new app, lines round the block at a hair salon, or a major contract with a retailer for a range of products, growth can be hard… and expensive.

Whatever your business requires to take advantage of new opportunities, the chances are that you will need to invest first and profit later, so pay-now-buy-later finance options that have been geared toward small businesses are a good place to start for short term lending.

For more information, visit or email UnLock at or call 1300 307 136.

[1] ASIC, Australian insolvency statistics (November 2018), Table – Initial external administrators’ reports—Nominated causes of failure by industry (1 July 2017–30 June 2018)

[2] As reported on Peoplekeep –,in%20recruiting%20and%20training%20expenses.