The next six months are set to see an increase in revenue, as well as improved business conditions.
That’s according to over 50 per cent of SMEs who were surveyed as part of a broader study into business confidence conducted by the Commonwealth Bank in March this year.
In its research report on SME Confidence, it was found that in the lead-up to the new financial year, many businesses are expecting growth: over 50 per cent expect an increase in revenue and 46 per cent expect an increase in profit.
The research also found that 39 per cent of SMEs are expecting business conditions in Australia to improve, with only one in ten (11 per cent) expecting conditions to decline.
Businesses cited better domestic economic conditions (49 per cent), an increase in business confidence (40 per cent) and an increase in consumer confidence (36 per cent) as the key factors driving business growth.
Adam Bennett, Executive General Manager Local Business Banking at the Commonwealth Bank believes the findings indicate a sense of optimism among the small business community.
“Overall economic conditions look largely positive, with strong employment growth, low interest rates and a healthy housing market supporting improving business confidence and spending patterns,” Mr Bennett said.
The SME Confidence Report measures confidence among Australian businesses with an annual turnover of $500,000 to $25m and explores the key challenges and opportunities surrounding these businesses in the current economic environment.
When it came to outlining how they expect to drive growth over the next six months, businesses cited cost reduction (48 per cent), staff performance (41 per cent), improved customer experience (31 per cent) and improved financial controls and management (29 per cent) as key priorities.
“In an increasingly competitive environment, we understand that businesses face challenges from both a macro and day-to-day business management perspective. While businesses appear to be more optimistic about the future, there are still key areas where they could do with more support, such as cash flow and financial management,” Mr Bennett added.
A total of 405 surveys were conducted with small and medium enterprises throughout Australia. The survey was conducted in March 2014 by ACA Research.
