Small and medium businesses (SMBs) can see the light at the end of the tunnel according to the latest Sensis Business Index (SBI) survey, with more than a quarter of Australian SMBs believing the economy is growing.
It is the fourth quarter in a row where a positive net balance score has been recorded and Sensis CEO John Allen says SMBs are finally seeing strength in the economy.
“This is revealed in their assessment of each of the key indicators, all of which―prices, sales, profitability, employment and wages―saw a rise in the net balance score both for last quarter and in expectations for the quarter ahead,” he explains.
“For the majority of businesses, growth is driving further employment and the employment net balance has improved to its best result in more than five years.”
It has become easier for SMBs to secure loans, and of the 12 per cent of businesses that applied for finance, more than two thirds were successful.
“With the ability to access finance, a SMB owner can think about capital expenditure to grow their business, which in turn can drive more sales and flow on to requiring more employees, and so on.
“While there is much that SMBs feel optimistic about there are still challenges and 12 per cent say that a lack of work or sales is a key concern while eight per cent are frustrated at the inability to find or keep staff.
“A number of state and territory governments are addressing this, rolling out training schemes to help build skills and capabilities useful to SMBs. Many of the unprompted comments coming from SMBs who believe their government’s policies are supportive cite the training programs that have been implemented as evidence.”
While all sectors have a positive net balance, retail trade is languishing at the bottom on +16, however, Allen is confident this upcoming festive season will bring positive expectations.
“As we head into the crucial Christmas period―especially for the hospitality; cultural, recreational and personal services; and retail sectors―business conditions are strong, hopefully ensuring a high level of confidence is maintained.”
By Marion Gerritsen