Transport SMBs start year with confidence boost

Small to medium businesses bullishness extends to freight and logistics services

Transport SMBs start year with confidence boost
Sensis sees confidence on the rise


The quarterly Sensis Business Index, which takes the pulse of Australian small to medium businesses (SMBs), makes for positive reading in the ‘transport and storage’ sector.

The report shows confidence jumped sharply from a low base despite a weak quarter and that expectations for key indicators are fairly positive although below average.

"The latest report shows SMB confidence is at its highest point since March 2010," a spokeswoman points out.

Interestingly, confidence increased by 17 points in the transport and Storage sector to +35 this quarter, despite a seven point drop in sales performance. 

And there were other devils in the detail.

"The volatility characterising confidence in this sector continued with a 17-point rise almost doubling the net balance to +35," the report states.

"Nevertheless, this is one of the lower scores.

"Sales growth impacted confidence ahead of an optimistic attitude and being an established business. Falling sales and competitive pressures created the most concern.

"Below average net balances were observed for all key performance indicators – profitability (-12), sales and prices (both -7) and employment (-6) with only wages being positive (+5).

"Expectations this quarter are below average for each key indicator – sales (+12), wages (+10), profitability (+6), prices (+5) and employment (-1).

"They are more positive for the year ahead – sales (+28), prices (+23), profitability (+21), wages (+20) and employment (+10).

"However, capital expenditure expectations (-6) are below average. "


Nationally, the Index, which reflects the views of 1,000 small and medium businesses from across Australia, revealed that more than four times as many SMBs (61 per cent) are now feeling confident, as those who are worried (15 per cent).

"Businesses closed out 2016 on a high, with confidence up seven points for the year and expectations that 2017 will be even stronger," Sensis CEO John Allen says.

"While business owners again felt optimistic about their own specific business strengths, it was the improvement in the perceptions of the economy which really drove confidence higher this quarter."

Businesses expect all of the key indicators – sales, employment, wages, prices and profitability – to remain positive, with strong results anticipated for sales and profitability in particular.

"The capital expenditure result was up nine points this year and now sits in positive territory, with businesses also reporting easier access to finance this quarter. These conditions should help foster growth in jobs and the economy in 2017," Allan says.

"The lower Australian dollar also appears to have had a positive impact on exports in 2016, with the number of businesses exporting goods or services rising four points to 15 percent."

The full report can be found here.

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