According to recently released figures from the Australian Bureau of Statistics, Australia’s exports grew by 4.2 per cent in 2016. In fact, Australia’s export prices are at their highest levels in eight years. This optimism is backed up by the latest findings in our exporter sentiment index. Of 1205 SME Australian exporters and survey respondents, 41 per cent believe the economy will be better in the next 12 months than it was in the previous – with only 20 per cent thinking it will be worse.
Over half of Australian exporting SMEs, believe they are in a better financial position than 12 months ago, and encouragingly, over half of Australian exporting SMEs (57 per cent) are confident that they will be in a better financial position in the next 12 months – with 56 per cent of SMEs expecting overseas sales revenue will increase in the next 12 months. This, an even stronger outlook in spite of current risks to global trade flows.
This positive outlook is translating to workforce planning, with over 40 per cent of exporting SMEs expecting to increase their staff numbers in the next 12 months. And in turn, SMEs are predicting positive movements in profitability of their international operations, with over half expecting profitability will increase in the next 12 months.
Small wonder then that so many Australian small businesses are taking advantage of the positive conditions and sentiment for export. Once such company is Down Under Enterprises.
Down Under Enterprises, a small business based in NSW, specialises in the farming, production, export and distribution of a wide range of wholesale natural Australian essential oils, carrier oils, and other ingredients for the global personal care market.
Down Under exports its full range of products across Asia and to the United States, where it has distribution facilities in Cleveland, Ohio. “We then distribute these oils to four types of customers,” says Dee-Ann Prather, Managing Director, Down Under Enterprises, “which are natural product, aromatherapy, private label manufacturers and multi-nationals in the US, Canada, Brazil and across Asia.”
“Right now, our major export market is the US, with roughly 92 per cent of our business. Then another six per cent goes to Asia, which is quite a small market but is growing rapidly. Our business has been growing for fifteen years,” says Dee-Ann, “and most of our customers have been with us for over ten years.”
Down Under needed additional funding to have further inventory ready in its warehouse, however its bank was unable to provide the support needed. Efic was able to provide an Export Working Capital Guarantee, which allowed Down Under’s bank to approve the finance that was required.
“Efic’s working capital guarantee facility allowed us to buy more inventory and have it available in our US warehouse, ready for our customers.”
According to Dee-Ann, “the year in which we received financial support, our business went up by 91 per cent. We were also able to employ four new people to help support this overseas growth.”
Andrew Watson, Executive Director – Export Finance, Efic