MYOB’s latest Business Monitor findings compared small and medium businesses, and found that Australia’s mid-market is more likely to anticipate increases in profitability in the year ahead.
According to the latest findings, half (50 per cent) of mid-market respondents anticipate an increase in profitability in the coming year, compared to just 41 per cent of small and medium businesses and 44 per cent believe they’ll realise increasing revenue compared to the national average of 38 per cent.
Additionally, just over half (51 per cent) of mid-market operators intend to increase spend on IT systems and processes, compared to a national average of 20 per cent.
Other areas of increase in the coming year for this business category include “prices and marketing on products/services old” (48 per cent), the “amount you pay employees” (47 per cent), “sales of products/services offline” (41 per cent) and “customer retention strategies” (41 per cent).
MYOB’s general manager for enterprise, Kim Clarke, said the higher expectations in the mid-market for investment growth indicate they are “primed for progress”.
“Despite caution about the economy overall, the research indicates mid-sized businesses are performing strongly, feeling confident in their own operations and are looking to make strong investments to solidify their growth and realise their ambitions in the year ahead,” she said.
“The report, which largely focuses on insights from small and medium businesses, will give larger operators some insight into the pressures faced by their small business clients.
“In particular, we can show that fuel prices [continue] to dominate the list of concerns after knocking the pandemic out of first position toward the end of last year.”
The top five things causing small businesses “extreme” or “quite a lot” of pressure at the moment include fuel prices (48 per cent), COVID-19 pandemic (35 per cent), cost of utilities (35 per cent), price margins and profitability (29 per cent) and cash flow (31 per cent).
Emma Fawcett, MYOB’s general manager for SME, said increases in these pressures revealed a “cost of doing business” crisis for smaller operators.
“Despite acute pandemic-related disruptions easing in 2022, the external factors continue to cause concern around the cost of living for consumers,” Ms Fawcett said.
“In turn, small and medium businesses are facing a ‘cost of doing business’ crisis.
“For mid-market operators with small business clients, these pressures are well worth taking into account when it comes to strategising around your prices, marketing and service model and, as Fawcett notes, there’s also a fair amount of variability in how each of these businesses is impacted.
“The severity of the challenges vary significantly depending on the size of the business and the demographics of the business owner.”
