Revenue increases amid SME calls for more government support
Australia’s SME sector is showing the strongest revenue performance of the last four years, while the proportion of businesses experiencing revenue decline has fallen to a five year low, according to the March 2015 MYOB Business Monitor.
Now in its sixth year, the bi-annual national survey of more than 1000 small to medium business owners found that 23 per cent of SME owners increased their revenue in the last 12 months. This is the highest level of revenue growth recorded since September 2011.
Thirty per cent of SMEs surveyed reported a decrease in revenue, the lowest level since March 2011. A further 43 per cent reported stable revenue in the last 12 months.
New South Wales had the highest proportion (26 per cent) of businesses reporting increased revenue in the past year, with the biggest revenue falls occurring in Queensland and South Australia (36 per cent).
By sector, SMEs in finance and insurance had a significant increase in revenue growth with 41 per cent reporting a rise, up from 20 per cent in August 2014. Transport (38 per cent), retail (37 per cent) and construction (36 per cent) businesses reported the largest revenue falls in the past year.
MYOB CEO Tim Reed said that the continuing trend of revenue increases and another drop in the number of businesses reporting less revenue was welcome news for the nation’s SMEs.
“The latest Business Monitor results demonstrate that the hard work of small and medium business owners is paying off.” said Tim Reed. “However, we continue to see a larger number experiencing declining revenue than those seeing it grow. For the sake of our economy, we need to address this by providing the nation’s SMEs with the support they need to drive their businesses forward.”
SMEs looking for more government support
Overall, more SMEs felt that the federal government could be doing more to help them succeed, with 33 per cent dissatisfied with the level of support they are receiving compared to 27 per cent saying they were satisfied. Younger business owners (Generation Y) were most satisfied while those aged 65 and above most likely to call on the government to do more.
This trend was mirrored in national attitudes towards state government, with 34 per cent of respondents being disappointed in their state government’s performance in the last six months, compared to 29 per cent of SMEs who felt that they had been performing well.
“The message from Australia’s small and medium businesses is clear – more support from the federal and state governments is required to allow them to reach their full potential and further develop the key role they play in our country’s economy,” said Tim Reed.
With the NSW state election looming, the results show that 35 per cent of the state’s small and medium businesses are satisfied with the Liberal Party’s performance in the last six months, with 26 per cent of SMEs dissatisfied. The higher level of satisfaction in NSW was an outlier to national trends overall and in other states, where dissatisfaction was higher. Businesses in South Australia (50 per cent) and Western Australia (40 per cent) were least satisfied with their state government’s performance in the last six months.
When questioned on which political party is most trusted to manage the country’s economy, the nation’s SMEs felt that the Liberal Party were best placed to do so (37 per cent), while 18 per cent backed the Labour Party.
A challenging year ahead
While the survey shows 33 per cent of SMEs are expecting revenue to grow in the coming year, up from 32 per cent, the proportion forecasting revenue to decrease climbed four points to 22 per cent. Businesses expecting stable conditions dropped three percentage points to 37 per cent. Businesses in Victoria and Queensland have the highest expectations for revenue growth, at 35 per cent for both states, while those in Western Australia were most likely to expect a decrease at 31 per cent.
The number of SMEs with more sales in the pipeline than they would normally expect remained stable at 36 per cent, although the proportion with less sales decreased three points to 20 per cent. New South Wales (40 per cent) and Western Australia (42 per cent) are the states with the strongest sales pipeline while South Australian SMEs reported the lowest amount of sales in the pipeline at 32 per cent.
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Louise Halloran, Ogilvy PR
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About the MYOB Business Monitor
After six years of conducting the MYOB Small Business Survey we've enhanced 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. We're pleased to present the new look MYOB Business Monitor.
The MYOB Business Monitor is a national survey of over 1000 Australia's business owners (and directors) conducted twice a year by Colmar Brunton.