Profits up, economic concerns remain: survey


Australian small businesses are reporting an increase in profits despite lingering concerns over the economy, says Reckon

Profits up, economic concerns remain: survey
Profits up, economic concerns remain: survey
October 12, 2010

Australian small businesses are reporting an increase in profits this year despite continuing uncertainty surrounding the economy and government, according to a survey by accounting software specialist Reckon.

Three quarters of those surveyed have reported increased (43 percent) or stable (32 percent) profits this year compared to 2009.

In particular, over 80 percent of Victorian and West Australian businesses reported an increased or stable profit result.

Reckon’s 2010 Annual Australian Small Business Survey shows 33 percent of small business owners/managers are most concerned about the threat of another economic downturn, followed by changes in government legislation (31 percent).

When asked to rank their second greatest concern 24 percent of respondents chose changes in government legislation, followed by interest rates rising (24 percent) and the threat of another economic downturn (20 percent).

SHIFT IN BUSINESS STRATEGY

Reckon’s Business Division CEO Gavin Dixon says there has been a shift in business strategy compared to last year’s results.

"When taking a look inside their own operation it is encouraging to see that compared to 2009 some businesses have been able to shift their focus from keeping their operation afloat to developing strategies that will help them grow in the future," Dixon says.

Small business owners/managers remain focused on staying in business (30 percent), increasing profits (22 percent) and improving cash flow management (16 percent).

In the 2009 Reckon Annual Australian Small Business Survey these same concerns ranked highly with 36 percent indicating staying in business was their main concern, followed by increasing profits 19 percent and improving cash flow management 11 percent.

KEY FINDINGS

Other key findings from Reckon’s latest business survey show 61 percent of small businesses expect to increase profits in 2011 compared with 2010.

Meanwhile, 9 percent expect a decrease and 30 percent expect to remain stable.

On the technology side of things, 46 percent of small businesses admit they do not have a website.

Twenty-five percent of small businesses indicate their website has some impact in driving customer to their business, 15 percent indicate their website has no impact and 14 percent say their website has significant impact.

Similarly, 81 percent of small businesses do not use social media as part of their business activities and 72 percent do not plan to use social media in the next 12 months.

However, nearly all small businesses utilise some type of professional service to assist with their business.

Only 14 respondents indicated that they do not use any professional services; 87 percent use an accountant and many use more than one type of professional service.

Over 400 small business owners/managers from across Australia took part in Reckon’s 2010 Annual Australian Small Business Survey to measure current business conditions, use of technology, decision making and work/life balance.


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