As the rollout date for Payday Super looms, agencies that prepare now can avoid unnecessary cash flow pressures and best position themselves for long-term growth.
With two weeks until Payday Super begins, requiring employers to pay super at the same time as wages, agencies have been urged to prepare now to avoid extra cash flow pressures.
The new reforms, set to start on 1 July, will mean that, rather than the current quarterly system, employers will need to pay superannuation guarantee (SG) contributions alongside employees’ salaries.
According to National Australia Bank (NAB) professional services banking executive, real estate Donna Kosiek, Payday Super will place greater importance on the timing of agencies’ cash flow management, making it essential for businesses to plan in advance.
“While the amount of superannuation being paid isn’t changing, contributions will need to be made more frequently, requiring business owners to plan ahead and ensure appropriate cash flow buffers are in place,” she said.
According to Kosiek, the agencies that had the most thorough understanding of their cash flow position were typically those with better capacity to support day-to-day operations and long-term growth ambitions.
"We’re seeing agency owners actively explore opportunities to expand through acquisition, recruit quality people and invest in technology that improves productivity and client service.”
NAB said that once the changes took effect, there would be a significant increase in the number of super payments, due to the shift from quarterly to more frequent payment cycles.
The bank’s data has shown that cash flow remained the most common issue for small and medium business owners, with 44 per cent citing it as their top concern.
NAB executive, small business Olivia Brosca said early conversations and preparation can help businesses adjust to the changes with confidence.
She said the organisation’s bankers were working with business owners to understand their cash flow and options to support any necessary adjustments.
“For some, that means forecasting cash flow more frequently or setting aside funds earlier so super payments don’t come as a shock,” she said.
According to Kosiek, the top-performing agencies were those that understood the economics of their business, down to the break-even cost per property managed.
“Strong property management businesses continue to provide stability, while many principals are using this period to sharpen operations, invest in talent and position themselves for future growth.”
Want to see more stories from trusted news sources?Make Real Estate Business a preferred news source on Google.
