"It's not the time for complacency. There are solutions and processes that can buy a company time, and the sooner owners and directors seek these solutions, the better," says Bradd Moreli the Chief Executive of Jirsch Sutherland who specialised in solvency.
Vixay Vue: Here is SBS Radio Hmong Program and welcome Bradd Moreli, the director of Jirsch Sutherland, a company dealing with solvency and solvency specialist, so can you tell us more about what are the impacts of the coronavirus on Austrian businesses and what should they do? Thank you.
Bradd Moreli: Obviously we're already seeing a significant impact an Australian business at all levels and we as a national sort of turn around insolvency firm received calls from businesses that have been impacted by the effects of coronavirus already particularly in the tourism sector but also in retail and education sectors and it's even beyond the calls that we put in enquiries that we perceive from the press it's clear that its impacting on large and small businesses alike across all of Australian across a number of industries.
So we were seeing it there, our main points to encourage Australian businesses especially SMEs - small to medium size enterprises to be proactive in their steps to minimised the likely impacts that the corona virus will have on their business and the main thing there is don't be complacent, plan and seek professional assistance they shouldn't stick their heads in the sand and be complacent.
One of the things I mean everyone focused on China at the moment and it is a significant trading partner with Australia I think approximately 30% of their exports go there, but there's also the importance of education and tourism in the like.
Give you some sort of bullet points around what we’re suggesting businesses do as I said before:
- Be proactive don't be complacent even if you're not in an industry that you think will be necessarily directly affected as well that there will be flow on effects is as well particularly long supply chain channels
- Communicate is a big thing but if you supplied it's unlikely that they won't have been impacted or potentially impacted distances as well are not roamig crimson in this situation. This situation is affecting not just regional areas but it's a national and even an international problem.
- Consider what the immediate impacts and broader impacts might be on your business it's effectively planning and engaged with your accountant or other business advisor to develop a bit of a plan particularly around cash flow fixed costs it can be changed.
- Consider supply channel issues start or most businesses these days operate on a near just in time supply chain process I mean it's been years I think since businesses Australian businesses had to be concerned about the reliability of the supply chains.
- In circumstances where you had concerns around your business is ability to continue or the impact of substantial engage with a specialist turn around insolvency advisor, this is about being aware of what your obligations are and what options are available out there to people, and some of those options out there a processes that allow businesses to get some breathing space until business is normalised so bring things back around to where they used to be
- One thing is we also encouraging people to be conscious is that we don't know how long the virus will be around it may be a significant period of time and once it's gone like it's not as though business will be back to normal a day after that could still be quite an extensive period of time before things normalise and again that could challenge businesses.
What I'm seeing with the inquiries that I've filled it, after businesses that historically and actually currently don't actually have any financial issues but they can see and I'll give you one classic example, it was a tourism operator who was reliant on 80% of inbound Chinese tourists those bookings have been cancelled or dropping off and not coming in.
Now at that particular point when I spoke to the person the business owner that there's no immediate financial issue in his business, however this losses revenue right which is just gone just evaporated, the Chinese debtors which are now indicating that they may not be able to pay or may have made a delay in their paying that business.
And the fact that he looks forward and I think it was about 4 weeks, he has a significant payment to be made to accreditor and he's concerned as well that my revenues now is pretty wild ride up, I don't know when it's going to normalise and whilst I don't have any problems right this second, in 4 weeks I have a payment to a accreditor that I'm unlikely to be in a position to pay, so this will be very much new territory. I think for a lot of business owners and issues that they've never experienced before.
Vixay Vue: Report saying that the Australian government is also proposing tax incentive for some business, is it confirmed yet that it will do so?
Bradd Moreli: I actually haven't read any of those articles or video and I don't feel that the government's made it clears to exactly what they going to do to assist Australian business especially small businesses which again is the backbone of Australia.
I mean some of the larger corporations maybe able to weather the storm would be better but small or SMEs that sort of a bit more sensitive to their cash flow, these sorts of hiccups will be quite concerning.
The government was quick to offer assistance to businesses affected by the devastating Bush fires that we've recently experienced but I'm just concerned at the lack of communication around what they intend to do to support businesses affected by the Corona viruses and not to take away from the businesses affected by the Bush fires but the potential disruption for businesses and the Australian economy from corona viruses potentially significantly greater the damage caused by the bushfires.
Vixay Vue: It is also surprised that there are no business counselling hotlines accept the one that you mentioned from your organization, why is that the case?
Bradd Moreli: Yet again, we've set up this hotline to assist businesses and their advisers do have been other immediately affected or anticipate being affected by the coronavirus.
As part of the hotline what whilst it's not just a China centric problem, its national. They are mended by fluent Cantonese and Mandarin speakers. we also have a specialist website that seen in Cantonese and Mandarin. We've already received or started to receive a number of calls and expected the number of causal or steadily grown.
Vixay Vue: Do you think that the Australian government supposed to set up hotline to help small business as it has set up a hotline for international students in Australia, so if they're worried about their business they can talk to the concern parties?
Bradd Moreli: I do expect, I do have faith that the government will act, I mean I'd like to be seen and doing more but I have no doubt and they probably will set up a hotline, but they were just trying to get on the front foot appreciate the likely impact it's going to have particularly on the small to medium size businesses.
One thing that was sort of promoting cooperation is vital and communication between all sort of stakeholders. As I mentioned before, businesses are not isolated in their challenges around the Corona virus.
It's likely that both sides the supply and customer side will be affected, but I think it's again I'd like to see the communication between the government, the revenue side of governments are the tax office state-based offices, office revenue side, liaising also with banks.
I mean to get that discussion going so they can start to put in or implement things that little assist businesses get through this period.
And again, and I'm repeating myself, but we just don't know how long this this is like this could last once it under control they'll still be a flowing estate it won't be fixed overnight.
Vixay Vue: Do you have any other insights to adds to what you just mentioned?
Bradd Moreli: My personal view is I think it's the Australian general in the business sector is being a bit complacent about it I think it's going to have a bit more damage to the economy and the global economy than people may appreciate and again its just around planning and being proactive and being aware of what your options are and what the likely impacts could be to your business.