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Despite the ongoing COVID-19 pandemic, 2021 is expected to be a good and profitable year by Gen Y-run and digitally-enabled SMEs.
The latest edition of the MYOB Business Monitor, a biannual report which surveys the views of 1000+ SME owners, reveals that 53 per cent of these Gen Y SME owners are expecting more profit in the next 12 months.
This does not come without a precedent, with the report noting that Gen Y SMEs achieved more profitability in the past 12 months (40 per cent) compared to the national average (26 per cent).
The research shows that 84 per cent of Gen Y SMEs have either a website, social-media presence, or both for their business. Over a third of SMEs surveyed shifted to online operations after COVID-19 hit and 83 per cent of those who did say it helped their business stay afloat during the pandemic. One in four SMEs surveyed now intend to double-down on digital by providing more products and services for sale online.
“Digital enablement is essential for the current and future success of SMEs,” MYOB CEO Greg Ellis said. “Many businesses would not have survived 2020 without digital tools as they became the only way to connect with customers, colleagues and communities at large.
“2020 proved that we have to stop treating digitisation as a future state,” Ellis added. “Yet MYOB’s Business Monitor survey has shown us that 34 per cent of respondents still don’t have any online presence. This needs to change, and it’s why we’re calling for digital incentives, such as rebates, for SaaS adoption to be introduced for businesses to encourage them to get online.”
Overall, the report found rising confidence among SMEs, with 48 per cent believing the Australian economy will improve in the next 12 months, more than double the 21 per cent who held this view in June 2020. 39 per cent of respondents say the profitability of their business is down compared to this time last year, but 43 per cent expect their profitability to increase over the coming 12 months.
However, many businesses are still feeling the effects of COVID-19, with 44 per cent of SMEs indicating revenue is down compared to this time last year and 21 per cent anticipating it will be down in another 12 months. 22 per cent said they will feel the disruption of COVID-19 for another six months at most.
“The latest Business Monitor findings show it’s more important than ever for business owners to be digitally enabled, and online businesses have the best chance at success,” Ellis said.
“Many of the pressures felt by Australian small businesses – such as attracting new customers or managing utilities or profitability – can be eased through technology-driven solutions. Digitisation is not just about using social media or designing a smart website. It’s about capitalising on the efficiencies and insights that digital technology can provide in terms of productivity, accuracy and making smarter business decisions,” Ellis concluded.