Small businesses in Australia are lagging behind other markets in the region on the key drivers of growth, according to a new survey released.
The survey, released by global accounting body CPA Australia, showed that growing small businesses are significantly more likely to focus on innovation, eCommerce, social media, training and exporting. Australia ranked last of eight markets surveyed on each characteristic.
On innovation, only five per cent of Australian SMEs reported planning to introduce a new product, service or process in the next 12 months. Every other market surveyed outperformed Australia on this measure: Indonesia (48 per cent), Vietnam (31 per cent), China (29 per cent), Malaysia (26 per cent), Hong Kong (15 per cent), New Zealand (11 per cent) and Singapore (nine per cent).
CPA Australia chief executive, Alex Malley said that while there are undoubtedly innovative small businesses in Australia, the gap between Australia and others in the region was concerning.
“As a nation we are investing significantly in driving a more innovative culture. We would hope to see this being reflected in Australia’s small businesses, but that does not seem to be happening yet,” he said.
“Many Australian small-business owners may be happy with things as they stand and they are not looking to actively grow their business, but in the longer term a lack of focus on the drivers for growth may undermine the value of their business.”
In terms of embracing the opportunities of the digital economy, the survey shows only 37 per cent of Australian small businesses reported earning revenue from online sales, well below the survey average (69 per cent).
Only nine per cent of Australian small business reported planning to grow their eCommerce presence to a large extent in the next 12 months. This result is again significantly below the survey average (34 per cent).
And only 46 per cent of Australian small business used social media for business purposes, this is in comparison to China where 96 per cent of small businesses reported using social media for business purposes.
Australian small businesses were also the least likely to have reported increasing employee numbers over the past 12 months (11 per cent) below the survey average of 32 per cent.
A higher percentage of small businesses in each of the other markets surveyed reported growing in the last 12 months with Australia again last on the list: Indonesia (91 per cent), Vietnam (89 per cent), China (74 per cent), Malaysia (69 per cent), Hong Kong (62 per cent), New Zealand (58 per cent), Singapore (55 per cent) and Australia (44 per cent).
“The differences in results reflect the differing challenges for mature versus developing economies, and the uncertain global environment,” Malley said.
“We would not expect to see the very strong growth reported in developing economies in Asia to be replicated in an advanced economy like Australia. However, Australia is lagging behind the other developed economies in the survey including New Zealand.”
“These results are a wake-up call to government to ensure the policy settings in place actually support our small businesses to innovate, embrace the digital economy and grow.”
Small-business owners in Australia are also much more likely to be older than small-business owners in Asia. Only 12 per cent of respondents in Australia were 39 or younger in comparison to the survey average (51 per cent).
The CPA Australia Asia-Pacific Small Business Survey* provides annual insights into the views of small businesses across eight markets in the region. This is the seventh year the research has been conducted.
* Full results at https://www.cpaaustralia.com.au/professional-resources/business-management/small-business/asia-pacific-small-business-survey
Inside Small Business