Australia’s business owners are reporting revenue losses, but have a positive attitude and expect the Australian economy to improve in the next 6 to 18 months, according to the enhanced MYOB Business Monitor.
“After 6 years of conducting the MYOB Small Business Survey we’ve redeveloped it to better reflect the profile of Australian businesses. We’ve now incorporated medium businesses along with the sole traders and small businesses that were already part of the survey,” explains Tim Reed, CEO of MYOB. “Following this, we’re excited to present the new look MYOB Business Monitor, the voice of Australia’s business owners.”
“The latest MYOB Business Monitor indicates that the economic downturn is hitting Australian business owners’ pockets, 39% of business owners surveyed report business revenue losses in the last 12 months, while only 19% report revenue gains,” continues Mr Reed.
However, on a brighter note, while business owners are reporting losses now, they are optimistic for the future, with just over half (54%) of business owners surveyed expecting economic improvement in the next 6 to 18 months. Further to this, 36% of business owners believe that their business revenue will increase over the next 12 months, with only 15% expecting a decline.
Business owners in Western Australia are the most optimistic about the economy, with 50% of business owners in WA believing that the Australian economy will improve within 12 months, whereas only 35% of business owners share this opinion in Victoria.
“While business owners may be under the pump now, it is heartening to see they do have a positive attitude for the next 12 to 18 months,” explains Mr Reed. “Business owners are resilient, seeing the glass half full, and the level of optimism demonstrates their positive nature and desire to ‘get on with doing business’.”
However the MYOB Business Monitor also reveals that many business owners are not tracking their cash flow effectively (48%), which impacts their capacity to make business decisions based upon a proper cash flow analysis.
“A surprising number of business owners appear to have little focus on managing their cash flow. The economy is not out of the woods just yet and we encourage business owners to really focus on cash flow, make it a priority and take full advantage of all opportunities to maintain, and possibly improve, their business health,” says Mr Reed.
When asked to choose one of seven possible changes that would make the single biggest difference to their business success in the next 12 months, 27% of business owners indicated that they would prefer additional business tax deductions, ahead of personal tax reductions (21%).
While optimistic, business owners are still realistic about the pressures ahead. They are still concerned about the impact of fuel prices on their business, with 30% of business owners (and 39% in Queensland) expecting fuel prices to put the most pressure on their business over the next 12 months.
Other pressures business owners are expecting on their businesses over the next 12 months include price margins and profitability, cash flow and competitive activity.
When looking to the future and seeking to improve their business performance, many business owners are unlikely to seek the help that they need. Nearly half (45%) of the business owners surveyed have not sought advice on how to improve their business performance.
“The majority, 76%, of business owners surveyed source information or advice on important tax and compliance issues from their accountant, however this drops to 31% of business owners who ask their accountant for advice on improving their business’ performance,” explains Mr Reed. “I encourage business owners not to hesitate to also seek specialist business advice from their accountant. An accountant can not only help with tax and accounting issues, but can assist business owners with business planning, financial goal setting, cash flow management and possible business performance improvements.”