There’s no sugar-coating it – things are tough out there right now. Cash flow is tighter, margins are getting squeezed, debtors are taking longer to pay, and plenty of owners are working harder while making less. A recent Newstalk ZB article put some numbers on it, with liquidations almost double what they were three years ago.

But here’s the thing: the businesses that come through periods like this aren’t necessarily the biggest or the busiest. They’re the ones that know their numbers, make decisions early, and stay on the front foot. That’s entirely within your control and it starts with asking the right questions.

Profit doesn’t equal success

One of the biggest myths in business is that profit means you’re safe. It doesn’t. We’ve seen profitable businesses run out of cash.

You can have a full order book and healthy sales on paper, but if your customers are slow to pay and your bills are due now, things get uncomfortable fast. The flip side? Once you understand your cash flow, you’re in the driver’s seat. You can spot the pinch points early, plan for them, and make confident decisions instead of reactive ones.

This is why cash flow, not profit, should be the number you watch most closely.

Five questions every business owner should be asking right now

At Traktion, these are the questions we think matter most in the current environment:

1. Do you know your cash position for the next 13 weeks? A 13-week cash flow forecast shows you what’s coming in, what’s going out, and where the pinch points are before they arrive. If you can see a shortfall coming in week eight, you’ve got time to do something about it.

2. Do you know which customers, products or services are actually making you money? Not all revenue is good revenue. Some jobs, products or clients quietly cost you more than they bring in. Knowing where your real margin comes from means you can focus your energy where it counts.

3. Have you reviewed your pricing in the last six months? Costs have risen across the board, but many businesses haven’t adjusted their prices to match. Absorbing rising costs might feel like the right thing to do for your customers, but if it’s putting the future of your business at risk, it’s not sustainable. There comes a point where passing some of that cost on is the responsible call.

4. Are your systems and processes helping your team work efficiently? When margins are tight, inefficiency is expensive. Double handling, manual processes and chasing paperwork all eat into time your team could spend on work that actually generates revenue.

5. If revenue dropped by 20% tomorrow, what would your plan be? Nobody loves thinking about this one, but there’s real peace of mind in having an answer. Businesses with a plan can act quickly and calmly when conditions change – and often spot opportunities their competitors miss.

Small steps that make a big difference

You don’t need to overhaul everything at once. A few quick wins to build momentum:

  • Chase your debtors. Getting receivables in the door faster helps in any economy, but especially this one. Tighten your payment terms, invoice promptly, and follow up early.
  • Review your costs. Go line by line through your spending and ask whether each cost is essential right now.
  • Stay on top of tax. If you’re behind with IRD or worried about an upcoming payment, don’t ignore it. There are options, and they’re much better when you act early.
  • Look at the numbers regularly. A monthly check-in on your cash flow and margins beats a nasty surprise at year end.

The best time to fix a problem is before it becomes one

Getting on the front foot isn’t about bracing for the worst, it’s about knowing your numbers well enough to make good decisions, whatever the next 12 months bring. The owners who do this don’t just survive tough patches, they come out the other side stronger and ready to grow.

We work with business owners across Tairāwhiti and beyond to build cash flow forecasts, review pricing and margins, and put plans in place so you can move forward with confidence. If any of the five questions above made you pause, let’s talk.

Get in touch with the Traktion team, a conversation now could set you up for a much better year ahead.

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