On the whole, SMEs are reporting low business confidence and continued challenges posed by cashflow, with the NAB Quarterly SME Survey revealing a disparity in confidence exists for businesses across different industries.
The survey found that on the whole, SMEs are less optimistic than larger corporates. The high Australian dollar, cautious attitudes towards spending in households and concern about economic uncertainty has added to the pessimistic outlook.
The biggest decrease in confidence was noted in the Construction, Finance and Retail sectors. Sentiment in Retail is now the weakest in all industries, though confidence in Health and Business services has improved.
Geographically speaking, confidence has fallen across all states with South Australia reporting the lowest level of confidence, followed by NSW and Queensland.
The survey revealed Property and Business Services recorded the largest decline in business conditions, while conditions improved slightly in Construction and Manufacturing.
Cash flow also remains a problem for small businesses, with business in the Transport, Wholesale, Property and Business Services industries reporting it posed a challenge in the June quarter, though it improved for Health Services.
The survey also showed that respondents perceived tax and government policy as well as global economic uncertainty to be constraining factors in the June quarter.
NAB Business Executive General Manager Daryl Johnson said the results reflect the many conversations he has had with customers across Australia in recent months. But he added the results also revealed a cause for optimism.
“There is, however, a remarkable resilience amongst SME business people and whilst many of them are currently being fairly conservative in how they run their businesses, they do remain focussed on the longer term,” Mr Johnson said.