How SMEs can manage their cash flow during the festive season.



cash flow

If you’re a small business owner, managing cash flow can be one of the many things that keeps you busy day-to-day, and sometimes awake at night.

With Christmas just around the corner, seasonal fluctuations may be about to impact your bottom line, meaning good news for some and bad news for others.

We wanted to share this editorial from smartcompany that focuses on stories of business owners who share your dilemma, along with their tips on managing cash flow and staying afloat as things fluctuate.

To read the full editorial from smartcompany click on the link here

If your business is struggling with cash flow contact Sage Business Group on (03) 9744 7144 to discuss your personal situation with one of our experienced team members.




How Xero helped this brewery keep a transparent culture

ero blog

When Ale Industries started out, it was rare to find a brewery that had a taproom slinging a triple-hopped IPA. Today, these are some of the staples of an ever-evolving industry.

Early on, Morgan foresaw a career for himself in brewing. After getting into homebrewing at the age of 18, he knew that he wanted to own a brewery of his own one day. He knew he would need some commercial experience, and at 21 he was finally able to start looking for work.

To put things in perspective, when Morgan was looking for work there were about eight breweries in the San Francisco Bay Area – so jobs were few and far between. Today, there are more than 200. Morgan eventually secured a volunteer position at a local outfit, and over time worked his way up to the coveted position of Brewmaster.

As Brewmaster, Morgan was charged with decommissioning old equipment and bringing in the new – one day, this gave him an idea. He could take that old equipment and get his own brewery off the ground. After some understandable resistance, the owner came around to the idea and in 2009, Ale Industries’ first beer was brewed.

Morgan says, in the years since, the change the industry has gone through has been huge.

“When we first started, Facebook wasn’t around – everyone was on Myspace,” Morgan remembers. “Social media marketing wasn’t a concept. If you wanted to get your name out there you went to beer festivals, got out and about talking to people, or took out print ads.

“The Internet 2.0 was really in its infancy. Companies had websites, but they were more like landing pages. Spreading the word is completely different today. That’s just one aspect of the business that has changed.”

The other is how we keep track of our financial situation.  Enter Xero Accounting Software.  According to Morgan, using Xero on mobile puts the power of accounting right into the hands of their salespeople or ‘foot soldiers’. They can easily pull up Xero when they’re out visiting customers, place an order or even check on whether they have an outstanding invoice or whether the account is within terms.

This cuts down time chasing up accounts payable and accounts receivable – things that would otherwise get buried, Morgan says. They have also created report templates that enable salespeople to see, in real time, how they’re doing in terms of the goals set for them.

If you would like to learn more about how Xero Accounting Software can help you reach your business goals then register for our FREE Xero Workshops.  Click here to find out more.

Let’s get to the core of the problem


Everyone comes to work to do a great job right? – initially anyway.  So why do businesses have poor performers?  Likewise, why do team members find it difficult to deal with conflict in the workplace; that difficult client or demanding boss?

To get answers to these questions we need to look beneath the surface.  Go beyond actions and behaviour and look to the drivers of performance: Core Values.

Why do values influence behaviour?

The Identity Iceberg demonstrates the impact our values have on actions and behaviour.  What’s visible above the surface – our Actions and Behaviours – are the tip of the iceberg.  They’re what we see and experience.  They’re driven by what’s beneath the surface.  

Immediately beneath the surface are our Habits – good and bad.  Consider how hard it is to change a habit.  These habits are driven by our Beliefs. 

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For example, we might believe that a certain team member is disengaged in the business because they’re often late, sick or the first to leave the office at night.  As a result of our beliefs, we create habits like overlooking them for new opportunities or ignoring their positive actions to focus on their bad behaviours.  We find it very difficult to change these beliefs.


As we move toward the bottom of the iceberg…

Our Values are the next layer; they drive our beliefs.  In the above example, if we value diligence, we are likely to believe that someone who is late to work or leaves exactly on time does not share our value.  Our diligence value is what drives our belief that this person is not performing.  The reality, however, may simply be that this team member is not feeling valued, is not being inspired by you as a leader, and has not been given an opportunity to align their personal goals with your business goals.

Our values are subconsciously fostered as we grow up; they’re instilled by our parents, mentors and experiences.  As a result of being developed over our lifetime, our values are impossible to change.  They’re in our hearts, out of sight but nonetheless a significant driver of our beliefs, habits and, ultimately, our actions and behaviours. 

At the bottom of the iceberg is our Identity – who we are defines our values.

Core Values are 4-5 principles that guide a business.

Core Values are most often derived by the owners of a business.  They represent how the owners want to operate their business, becoming ‘decision-making filters’ or ‘culture guidelines’ for the team and owners.

Where there are up to two owners with a team of less than 20, it can be very powerful to involve the entire team in the process of deriving Core Values. However, ultimately it is up to the owners to determine the extent to which they involve the team in setting Core Values. 

Learn more about your business, register now for our FREE 7 ways to grow your business workshop by clicking on this link.

 When addressing poor performance we must reference Core Values

Going back to our hypothetical poorly performing team member, we must clarify what Core Values we believe the team member is not living into.  We can then discuss their performance with specific reference to them.  

For example, we might say ‘I’ve noticed you’re often late for work and I’m concerned that you’re not living into our diligence Core Value.  Is there something going on that is getting in the way?’  You’ve immediately opened the door for an explanation.  As long as your team members believe and buy into your Core Values you should get an honest answer from them.  You can agree how you’re going to work more effectively together in the future.

Learn more about your business, register for our FREE 7 ways to grow your business workshop by clicking on this link.

Your Core Values will help you deal with conflict

They are the decision-making filters and culture guidelines, so when there is conflict, you should be able to identify one or two Core Values that you feel are being ignored.  Discuss them with the team members involved.

There is no hierarchy in Core Values

Most importantly, remember that just as you can hold a team member to account for not living into a Core Value, so too can a team member call you out.  If the team is not challenging you on the Core Values as much as you are challenging them, then your Core Values simply aren’t working.  You are then due for a Core Values refresher – a time to revisit, review, re-define and re-commit.

A parting thought

Even if there’s a penalty for holding onto one of your Core Values, you should never give it up.  For example, if you believe your biggest client is not living into your Core Values and you can’t convince them to change, then you must let them go, even though you’ll suffer a financial loss.

The positive effect on your team and culture will outweigh the loss.

‘In matters of style, swim with the current; in matters of principle, stand like a rock.’ – Thomas Jefferson

Learn more about your business, register for our FREE 7 ways to grow your business workshop by clicking on this link.

The Dangers of Discounting

A common misconception is that, when sales are falling, a great strategy to avoid the sales decrease is to offer a discount.  The reality is actually the opposite; you can often be more profitable by holding your price and accepting the reduction in sales volume.

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Consider the example below: If sales are currently at 10,000 units per annum at $100 and your costs are $60 per unit then your gross profit is $400,000.  If you offer a discount and this means sales remain constant at 10,000, you’ll only achieve $900,000 in sales so $300,000 gross profit.

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If instead you accept the 10% drop in sales but hold your price at $100 per unit you’ll still only make $900,000 in sales but you’ll only have to pay for 9,000 units.  So your gross profit will be $360,000.  In other words a $40,000 reduction in gross profit compared to a $100,000 reduction if you offer a discount.

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If we look at this another way and see how much sales need to increase by to maintain our original gross profit of $400,000 if we offer a 10% discount:

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Instead of having to sell 10,000 units per annum we now have to sell 13,333 – a third more!

Discounting is simply not the answer – it’s a race to the bottom.  Look at all other alternatives starting with what you can do to delight your clients so they’ll keep coming back.


If you would like to learn more strategies just like this one, simply register for our

FREE 7 ways to grow your business workshop.

Contractor V employee – is your business at risk?

Hands In Front Of Chalkboard

Contracting is becoming more popular as an alternative to the traditional employment relationship. As contracting and employee mobility become more sought-after, the difference between what constitutes an employee and a contractor becomes less clear. However, there are dangers in engaging a worker as a “contractor” without having a proper understanding of the various employer obligations.

You may find that a worker should be characterised as an employee at common law, and this brings with it a range of obligations and liabilities if you get it wrong.

Would you like to learn the 7 ways to grow your business – click here

Where a worker is deemed an ’employee’ the employer is required to:

  • Withhold and remit PAYG withholding from the employee’s wages.
  • Pay superannuation guarantee on behalf of the employee.
  • Report and pay fringe benefits tax (FBT) if fringe benefits are provided.

Where a worker is deemed a ‘contractor’:

  • The contractor will generally look after their own tax obligations.
  • The principal may still have to pay superannuation for individual contractors if the contract is principally for their labour.
  • There are no FBT obligations.

PAYG withholding

There is no definition of an “employee” in any tax legislation. The relevant test for determining whether an individual is an employee for PAYG withholding is the common law test.

Courts have traditionally assessed the relationship against a range of indicia (known as the ‘multi-factor’ test), all of which, when combined, determine whether a relationship is one of independent contract or employment.

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The outcome of this test is subjective in nature and is not determined mathematically by reference to the total number of factors pointing to the existence of one type of relationship versus the other. It is equally important to note that no one factor will be conclusive. In addition, the position for an individual is not affected by whether or not the individual has supplied an ABN.

Generally, PAYG does not need to be remitted where payments are made to a contracting entity that is a partnership, trust or company, provided that entity quotes an ABN and the arrangement is not a sham or a mere re-direction of an employee’s wages. The question as to whether an individual engaged through a contracting entity can be characterised as an employee was determined in the Full Federal Court in Ace Insurance Limited v Trifunovski [2013] FCAFC 3.

The Full Court upheld the decision that the sales agents were in fact employees of Ace Insurance Limited, despite providing services to Ace Insurance Limited through companies incorporated by each of them. The judges considered the indicia relevant in determining whether a person is an independent contractor or employee.

Even when an individual is deemed a contractor under common law, we suggest that the employer also consider whether the individual may be deemed an “employee” for superannuation guarantee and payroll tax purposes under the extended definition. These provisions are discussed in more detail below.

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Superannuation Guarantee

The Superannuation Guarantee (Administration) Act 1992 (Cth) (SG Act) requires an employer to make superannuation contributions for the benefit of employees at common law and for persons who are captured by the extended definition of “employee,” where that person works under a contract that is wholly or principally for the labour of the person.

The ATO considers that an individual works under a contract that is ‘wholly or principally for the labour of the person’ where:

  • The individual is remunerated (either wholly or principally) for their personal labour and skills.
  • The individual must perform the contractual work personally (there is no right of delegation).
  • The individual is not paid to achieve a result.

The extended definition of “employee” means that, if you engage an individual as a contractor, you may need to pay superannuation contributions on their behalf, even if the written contract does not provide for this and the contractor provides an ABN.

Payroll Tax

In most States and Territories, there are specific contractor provisions which (subject to certain exemptions and concessions) deem payments to contractors to be ‘taxable wages’ for payroll tax purposes. The contractor provisions capture all payments to contractors as part of an employer’s taxable wages regardless of whether the contractor is an individual, or is engaged through a company or trust structure. Western Australia is the only State where there is no requirement to include payments to contractors. Payments to sole traders who are contractors will only be caught in Western Australia where the persons to whom the payments are made are, ‘in substance’, employees.

We recommend that available concessions and exemptions should be reviewed in each jurisdiction in which contractors perform services. The onus is on the employer to substantiate the exemption.

What if an employer gets it wrong?

If an employer incorrectly classifies a worker, the employer may be liable for:

  • Superannuation guarantee charges, where an employer fails to make superannuation contributions for the benefit of the individual either because they are an employee at common law or because they are an “employee” under the extended definition in the SG Act.
  • Additional payroll tax (including penalties and interest) where an employer has incorrectly claimed contractor exemptions on payments made to contractors for which there are no exemptions available.
  • Unpaid annual and long service leave, where you have incorrectly classified an individual as a contractor.

If you would like further clarification about these terms, or believe this information could be relevant to your employment situation,  please contact our professional team at Sage Business Group on (03) 9744 7144.


The 5 A’s of change

The 5 a's of change

As we draw to the end of the financial year, as business owners we often reflect over the past 12 months.  This more than often heralds a time for change, a refreshed approach, a new perspective and an opportunity to make a positive difference.  It’s also a super busy time of year with plenty of demands on our time – when can we play with the children, escape for that winter getaway and generally spend less time at work?

Here is a practical way to ensure that positive change can be achieved in 5 easy steps (the 5 A’s of Change):

Awareness – first we need to be aware what needs to change.  Maybe we want to work smarter not harder this year so we can have more family time and better financial returns.

Acceptance – we need to accept that in order to be able to work smarter we will have to do things differently this year compared to last year.  There is no magic bullet – we need to make a better plan as to what we need to do.

Action – once we have a plan we have to implement it.  Otherwise the plan is simply a pipe dream that will never become a reality.

Accountability – in order to make sure we take action, we should get someone independent to hold us to account.  Liken this to making a commitment to going to the gym with someone else at 6am – you’re way more likely to show up if you’ve committed to that action with someone else.

Acknowledgement – Old habits die hard and it takes 21 times to change a habit.  By celebrating the success of taking that action we agreed to, we help to reinforce that ‘good behaviour.’

So embrace this powerful model if you want your goals to become a reality.  Share the model with others as well.  Most importantly, make a commitment to real and positive change moving forward – you will feel so much more empowered.

‘The secret of change is to focus all of your energy not on fighting the old, but on building the new.’ – Socrates

Are you ready to start your change?  Click on the link to find out about the 7 ways to grow your business workshop.  

Meet the face of our business

SAGE Raelene Furness

Since joining the team at Sage Business Group in September 2016 Raelene is thoroughly enjoying meeting clients and is endeavouring to familiarize herself with as many “faces” as possible so she can provided everyone with a personalised welcome.

Her position as Receptionist allows her to indulge in her passion for “customer service” with an aim to provide a positive experience and outcome to every client enquiry whether it be face to face or over the phone.
Since moving to our new premises in Gap Road Raelene has taken on the responsibility of co-ordinating the hire of our state of the art “Centre of Excellence” training room. You can email to find out more information.

Despite moving to Sunbury with husband Dave some 20 years ago, this is the first time Raelene has worked locally and she is loving the reduced travel time and opportunity to walk to work.

A Mum to two adult daughters and a Grandmother to four delightful grandchildren, Raelene loves spending quality time with her family. In her spare time she enjoys reading and unwinding at their “cottage” near the Grampians as well as overseas travel. In 2010 Raelene undertook her first overseas trip incorporating the wonders of Egypt, the Greek Isles and Turkey (including a very moving visit to Gallipoli) and in 2015 she and husband Dave spent 8 weeks abroad travelling around Europe. Next trip planned is 2020 covering England, Ireland, Scotland & Wales


Three major tax changes/opportunities coming on 1st July 2018



1. Do you want to accelerate the process to save for your first home?

The First Home Super Saver Scheme (FHSS) enables first home buyers to save for a deposit inside their superannuation account, attracting the tax incentives and some of the earnings benefits of superannuation.  Read more….

2. Should you consider contributing the proceeds of the sale of your home to superannuation?

From 1 July 2018, if you are over 65, have held your home for 10 years or more and are looking to sell, you might be able to contribute some of the proceeds of the sale of your home to superannuation.  Read more…..

3. What you need to know about single touch payroll.

Employers with 20 or more employees at 1 April 2018 must use standard business reporting-enabled software from 1 July 2018Read more…..

If you would like to know more information about any of the above topics please contact our team of professionals on (03) 9744 7144

General advice disclaimer – General advice warning: The advice provided is general advice only as, in preparing it we did not take into account your investment objectives, financial situation or particular needs. Before making an investment decision on the basis of this advice, you should consider how appropriate the advice is to your particular investment needs, and objectives. You should also consider the relevant Product Disclosure Statement before making any decision relating to a financial product

Solid global economic outlook for 2018


After more than a year of unusually benign market conditions, February began with a rolling wave of volatility, the likes of which we haven’t felt for over 2 years. Measures of share market volatility spiked to their highest levels since August 2015.

Despite the media hype, the pullback has generally been described by most of us industry experts as “healthy” and “long awaited”, given that we had seen 15 straight months of gains for US shares and January had just delivered the strongest start to the year for three decades. In the short term, this should not detract from the solid global economic outlook for 2018.

For the first time in a decade all the world’s top economies are growing. The International Monetary Fund (IMF) forecasts the global economy will expand 3.9 per cent in 2018, the fastest rate in eight years, up from 3.7 per cent last year. US growth is expected to reach 2.9 per cent this year on the back of tax cuts. The Eurozone, Japan and some emerging economies such as Brazil are also tipped to gather steam this year.

In the US, the recently unveiled US$1.5 trillion Trump infrastructure plan along with the US$1.5 trillion tax package approved late last year should also help buoy markets in the months ahead. But a big risk to the impact of these growth stimuli could be rising interest rates, which would be a natural response to stronger growth and higher debt levels. The speed of these rate increases will go a long way to determining how good a year we can expect in local and international share markets.

If you would like to talk to our team of professionals about building your wealth and securing your financial future contact our Wealth Management team on (03) 9744 7144 or email


Business owners – what is your end game?

team work for success

Why do you own a business?

It’s interesting to consider this because we are shocked at how many business owners haven’t taken the time to consider this fundamental question.

From a big picture perspective, having a business provides you with a lifestyle. That’s it!

It gives you cash now to fund your family spending, and hopefully a lot of cash in the future when you sell your business.  And it’s very similar to having a Self Managed Super Fund (SMSF), an investment property or share investments. They give you cash either now or in the future, or a combination of now and future.

Having a business, SMSF or an investment property is not the important thing. The important thing is what the cash you receive from owning these allows you and your family to do.  Your plans for what you do will do with your business, SMSF or investment property in the future are what we call your ‘end game’.

A good business mentor and friend of ours once taught us that “the point of having a business is to sell it – even if you don’t want to right now.”  This one pearl of wisdom could mean hundreds of thousands or even millions of dollars more for you in the future if you let it guide you now.

Here’s how… as you run your business, start to make decisions now to plan for selling it – even if you don’t plan to sell it for many years.  The biggest thing you can do is to make changes so that your business does not depend on you. If your business needs you to operate – can you really sell it? Absolutely not.

Setting up systems for your business is the key. You can then train your team to follow your systems, and then you can gradually delegate what you do to the right team members, and then you’ll find that you’ve got a business that can partially run without you.

Would you like us to be your sounding board?

At Sage Business Group we can help you to work out your end game, and plan to have a business that you can sell for a much larger amount in the future because it doesn’t depend on you.

Contact us today on (03) 9744 7144 or email for a free initial meeting about creating your end game.

General advice disclaimer – General advice warning: The advice provided is general advice only as, in preparing it we did not take into account your investment objectives, financial situation or particular needs. Before making an investment decision on the basis of this advice, you should consider how appropriate the advice is to your particular investment needs, and objectives. You should also consider the relevant Product Disclosure Statement before making any decision relating to a financial product