Running a profitable business does not necessarily mean that the business is making the best possible use of its money. A company may generate consistent sales and report a profit while tying up significant capital in equipment, inventory, property or other assets that deliver limited returns.

For Australian small business owners, understanding return on capital can provide a clearer picture of whether the resources invested in the business are generating sufficient financial value. This measure can help owners evaluate profitability, compare investment opportunities, identify underperforming assets, and make more informed decisions about future growth.

Assessing returns on capital involves more than looking at the amount of profit reported at the end of the financial year. Business owners also need to consider how much capital is invested, the cost of financing operations, the risks associated with the business, and the returns available from alternative uses of that capital.

This article explains how to assess return on capital, which financial measures to use, what results may indicate, and how Australian businesses can improve the returns generated by their resources.

Since 1 October 2026, Australian businesses can no longer add a separate surcharge to eligible Visa, Mastercard, American Express and eftpos card payments. The idea was to make prices clearer for customers. For cafes and other small businesses that used surcharges to cover the cost of taking card payments, it has created a new problem.

Early data suggests some cafes have responded by raising their coffee prices. A survey of more than 10,000 cafes found about one in five lifted prices in October, often by 50 cents. Other transaction data tells a different story, with most businesses leaving prices alone.

Wages, rent and supplier costs are already squeezing small businesses, so owners now have to decide what to do with payment processing fees. They can absorb them, build them into advertised prices, or look at other payment arrangements.

This article looks at how the surcharge ban is playing out for cafes and small businesses, what’s driving price changes, and how to manage merchant fees without hurting your profit.

Setting financial performance targets gives Australian business owners a clearer direction for managing their finances and planning for growth. Without measurable targets, it can be difficult to determine whether revenue is increasing at a sustainable rate, expenses are under control, or the business is generating enough profit to support its long-term goals.

Financial targets help turn business ambitions into practical objectives. These may include increasing revenue, improving profit margins, maintaining sufficient cash reserves, reducing debt, or achieving a specific return on investment. The right targets depend on the business’s industry, size, financial position, and stage of development.

This guide explains how Australian business owners can establish realistic financial performance targets, select meaningful financial indicators, use historical results to set benchmarks and monitor progress throughout the financial year. It also explores how professional financial advice can help businesses make informed decisions and improve long-term financial performance.