New research indicates both positive and negative developments for SMEs as pandemic worries begin to decline. On the plus side, there has been a decrease among SMEs experiencing economic struggles due to COVID-19 – the latest MYOB Business Monitor reveals that proportion is now at 35 per cent, a 20 point decrease from this time last year. The research also shows, however, an increase in the number of SMEs of experiencing various issues they faced before the pandemic.
These entrenched concerns include cashflow and the cost of utilities (felt by 32 per cent of respondents). Drilling down the results, these financial concerns include access to finance (an increase of 26 per cent from 20 per cent in December) and late payments by customers (up to 29 per cent from 25 per cent in the same period).
“It’s an unfortunate return to ‘business as usual’ for the country’s 2.29 million SMEs with 14 of the 16 business pressures measured by the MYOB Business Monitor increasing in the last six months,” Emma Fawcett, MYOB’s General Manager SME, said. “This demonstrates that as COVID-19 pressure subsides other business pressures increase.
“SME concerns with payment times and old bugbears associated with physical presence – such as utilities like electricity and gas – are back on the table,” Fawcett added. “It seems these issues were temporarily superseded during the pandemic but are increasingly back on the radar now for many SMEs.”
The research, which surveyed over 1000 Australian SME owners before Victoria’s latest lockdown, found that small-business owners are generally feeling positive about the year ahead, with 57 per cent predicting an uplift in Australia’s economy and 48 per cent predicting their revenue will be up 12 months from now.
Nationally, 30 per cent of SMEs report an increase in revenue on a year ago, up from 19 per cent in December. The likelihood of a revenue increase in 12 months’ time is up 11 points to 48 per cent, compared to 37 per cent at the end of last year.
With regards to outlook, SMEs are looking within the nest 12 months to increase the prices and margins on what they sell (30 per cent), retaining customers (29 per cent), as well as customer acquisition, employee payments and marketing/advertising online (all 28 per cent).
“After a challenging trading year, it’s encouraging to see SMEs looking to explore new revenue opportunities over the next 12 months,” Fawcett said. “It’s concerning those operational pressures are on the rise as the country recovers from COVID-19, however an overall confidence in the economy as well as SME revenue, is a good sign for a sector that makes up 95 per cent of Australian businesses.”