New research by Australia’s largest accounting software provider, MYOB Enterprise Solutions reveals that the economic confidence and overall business outlook of small to medium business operators (SMEs) is finally on the rise.
The March 2013 MYOB Business Monitor found over one quarter of SMEs expected the domestic economy to improve within 12 months (26%), a welcome increase of seven percentage points from the July 2012 report (19%).
Independently commissioned to Colmar Brunton, the Monitor researches business performance, attitudes and plans over time, with the latest study surveying 1,005 Australian business owners and managers. Just 37% expect an economic improvement to take one to two years, down from 42% while those who think it will take more than two years is now 22%, down from 24%.
This positivity was echoed in the expectations of revenue results for this year. Overall, 30% were anticipating a revenue rise, 42% expected revenue to be stable, 19% expected a fall and 10% weren’t sure.
CEO Tim Reed says that MYOB expected a rise in economic confidence amongst SMEs around the time of the December cash rate cut, when a retrospective analysis was conducted of the last five Business Monitors. He observes that 72% of SMEs expect increased or stable revenue this year against only 58% last year, indicating hope is springing back for Australia’s business coalface.
He advises the 19% who expect revenue to fall to seek assistance from a business mentor, coach or advisor such as an accountant.
Highlights of the March 2013 MYOB Business Monitor:
- Two fifths of respondents (40%) reported steady revenue when asked to look back over the past year (40%), a little more than those who saw revenue decline (39%)
- Proportion that experienced a revenue rise was on par with July 2012 (18%)
- Operators in the manufacturing and wholesale industry faced a revenue fall (52%)
- Finance and insurance industry most likely to see a rise (29%)
- Transport, postal and warehousing industry most likely to see steady revenue (49%)
- Queensland and Western Australia most likely to see a rise in revenue (22%) with WA least likely to report a loss (32%)
- New South Wales and Victoria had the highest proportion of revenue fall (40%)
- South Australians most likely to have steady revenue (45%)
- 30% of SMEs surveyed reported more work/sales in their pipeline for the next three months than anticipated, 41% reported an expected pipeline and 28% see less work than expected
- Cash flow pressures drop to 4th place among top pressure points for SMEs; fuel price heads the list followed by new customers and price margins/ profitability
- Retailers and tourism operators as well as manufacturing and wholesale operators continue to battle the impact of the strong dollar
- Customer retention strategies: 38%
- Customer acquisition strategies: 35%
- Number or variety of products or services offered by the business: 26%
- Prices and margins on the products/services sold: 23%
- Sales of products/services online: 22%
He observes that there are numerous advantages to bringing any business online, whether it’s via an easy-to-navigate business website, teleworking, fast broadband or online accounting such as MYOB LiveAccounts. Advantages include increased lead generation, improved productivity, better collaboration with internal and external teams and reduced operating costs.
He concludes by saying that an online presence can help create new revenue streams, attract new customers, keep customers loyal and also make the business more competitive.