As Easter looms, many small businesses around the country are gearing up for one of their busiest periods of the year.
If last year's Easter holiday is any guide, businesses with annual revenues of less than $100 million are likely to rack up some $278 million in sales over the long weekend.
Easter goodies for some - but many small businesses will have to wait.
While the registers will be ringing, the usual delays in bank processing of electronic transactions means many firms' accounts would see the money transfers land in their account for as long as two days after the customer has left the shop.
Those transfer delays add up, not just during Easter, but across the year. About 61 per cent of small businesses believe they would save an average of $400 a month if they could access funds from eftpos sales on the same day, according to research commissioned by Commonwealth Bank.
Julie Sweet of CertificatesOnline.com.au said the $400 a month estimate may actually be conservative. Before her company switched to a merchant facility two years ago, delays in eftpos processing had stymied her company's ability to meet customer expectations.
“We were guaranteeing clients a 24-hour turnaround (on receiving their official certificates) and yet we were at one point unable to process or have their eftpos go through,” she said.
Ms Sweet's company depends in part on state registries of births, deaths and marriages, Unfortunately, the registries don't process applications for copies of certificates until they receive applicants' money, making it difficult for CertificatesOnline to fulfil client orders in the 24-hour period they promised.
“It ended up becoming a long delay and we weren't giving our clients the services we promised we would,” she said.
Ms Sweet said her Sydney-based company, with revenues under $10 million a year, has since switched over to a merchant facility that accepts credit cards, with the transactions occurring instantaneously.
Slow pay
Companies with turnover under $1 million a year say slow payment processing has adversely affected their cash flow, the CBA research shows.
Underscoring the pace of transactions in Australia's payment systems network, banks will be on a scheduled payment holiday on Good Friday and Easter Monday, halting the flow of funds between banks in that time.
Even the Reserve Bank has acknowledged the slow pace of Australia's payment system in a series of speeches recently.
Greg Evans director of economics at Australian Chamber of Commerce and Industry said that during the current slump in the domestic sector, small businesses are finding payment delays one more drag on their operations.
“From a cash flow point of view, they're on the edge compared to large businesses,” he said.
Company credit tracking agency Dun & Bradstreet said that in the final quarter of last year, businesses with between 50 and 199 employees saw the time it took to pay a bill rise 1.4 per days, compared with a year ago. SMEs with between six and 19 employees saw average payment times rise 1.3 days over 2011. Commonwealth Bank's research was conducted by ACA Research in February 2012, compiling responses of companies with revenues under $100 million.