Global demand for cheaper cuts of beef is expected to increase in the year ahead as rampant inflation and slowing economic growth see consumers trade down, Rabobank says in a newly-released report.

And Australia – as one of the largest exporters of beef ‘trimmings’ (the cheaper meat cuts which remain after prime cuts are removed) – is expected to be among the best-positioned countries to benefit from this increased international demand, particularly from the US, the agribusiness bank says in its Q3 Global Beef Quarterly.

“Evidence of declining consumer confidence in the face of slowing economies and rising inflation is starting to build,” the Rabobank report says.

“In general, beef markets are resilient to changes in economic conditions. However, we do see movement within supply channels and price points that tend to favour cheaper options such as mince/ground beef and quick-service restaurants over the more expensive cuts and consumption channels.”

Growing demand for Beef

The bank forecasts the volume of trimmings consumed globally to remain strong and potentially increase in the second half of 2022 as consumers continue to trade down to lower-value beef cuts and cheaper proteins. Trimmings are typically used in the production of ground or minced beef.

“Major importers of trimmings include the US, China, Japan and South Korea,” the report says. “With these countries facing slower economic conditions in the second half of 2022, we expect consumer-purchasing decisions to favor the consumption of trimmings. The US and South Korea face high inflation pressures, whilst China and Japan continue to struggle with slower economic growth off the back of COVID.”

In the US – with its high consumption of ground beef – this should support demand for trimmings both from domestic and imported sources, Rabobank says.

Adding to the changing consumption habits due to economic conditions is the potential for the US to dramatically increase its need for imported trimmings.  The report says that high domestic beef production in the US is reducing the need for imported trimming products.  But, if US production contracts – with a slowing of the current US cow liquidation – higher import volumes will be needed.

And Australia and New Zealand will be in the ‘box seat’ to help fill that demand, says Rabobank senior animal protein analyst Angus Gidley-Baird.

Australia’s increased herd inventory will generate additional grass-fed and female slaughter numbers.

However, a caveat remains for the Australian market with our current limited processing capacity, Mr Gidley-Baird says. “Unless we can correct this, our ability to ramp up production and capitalise on any trimmings demand growth will be limited,” he said.

Global beef market outlook

Rabobank’s Q3 Beef Quarterly says the global beef market remains strong.

“Most beef retail prices (in domestic currencies) continued their upward trend in Q2 or remained steady,” the report says.

Beef prices in most markets are sitting between five and 11 per cent higher than quarter two in 2021, with the UK a notable exception recording a decline in prices as consumer demand for beef has softened due to high retail prices.

Cattle markets worldwide also remain favourable, the report says, supported by either seasonal conditions – in the case of Australia and Brazil – or strong demand, in the case of the US.

There was however some decline in cattle prices (in US dollar terms) from the previous quarter in countries including Australia, Brazil, Argentina and New Zealand.

Australian cattle prices

Cattle prices continued to decline through July, Mr Gidley-Baird said, dropping below “year-ago levels” for the first time in 2.5 years, although we have seen them lift through August.

“Prices remain historically high,” he said. “Although at the end of July the Eastern Young Cattle Indicator for weaner age cattle had dropped 23 per cent since the beginning of the year, there is no need to panic.

“Since the beginning of August, we have seen prices rise again. We feel that the change in the seasons prompts producers to hold cattle, reflected in lower sale yard numbers. With weaner cattle prices dropping the margin for backgrounders has improved which we believe has stimulated some additional demand.”

Mr Gidley-Baird said the bank expects cattle prices to contract through Q3, but the warmer spring months and pasture growth should see some stability return to the market with some possible upside in Q4.

Although Australia’s cattle slaughter numbers are slowly increasing, volumes remain historically low. Mr Gidley-Baird expects overall production for the year to be similar to 2021 at 1.9 million metric tonnes.

While there are many similarities in the actual process of buying a business or a property, leading business sales marketplace AnyBusiness.com.au says that many business buyers are confusing the investment strategies and earnings prospects of the two very different asset types. 

“The key considerations of purchasing a business versus a property are virtually polar opposites. Yet many mum and dad investors and people looking to become their own boss are mistakenly using the same approach for both,” says Mary Tamvakologos, Director of Operations, AnyBusiness. 

“Business is well-known to be a riskier place to invest money compared to property, but what isn’t so apparent is the fact that businesses have a much lower cost of entry. Median house prices across Australia are currently around $747,800¹ – and far higher in some capital cities – while many businesses can be purchased for a fraction of that amount.” 

For example, a fully managed Port Melbourne café is currently listed for sale at just $49,000, while a 40 year-old NSW-based automotive antitheft technology manufacturer is listed at $380,000. 

But perhaps the greatest misconception is that, unless you develop the next Facebook or Google, the greatest financial returns come from property. 

“To a large extent, you can’t control a property’s value: the sale or rental returns are relatively capped by market forces determining the value of similar homes within the same area,” says Mrs Tamvakologos.

“Business owners, however, have virtually unlimited control over their revenue growth and value, which are determined by factors under their stewardship such as marketing effectiveness, operational efficiency, sales conversions and customer satisfaction. And they don’t necessarily have to wait years, or decades even, to realise that growth.” 

Business broker and director of Melbourne-based Paramount Business Brokers, Fred Samoun, says that the property and small business markets (those below $1 million in value) are inextricably linked, as owners often leverage property equity to purchase and operate their business. Yet the similarities largely end there. 

“In the small business space, prospective buyers often ask questions as if it were a property purchase. But aside from the actual buying process – search online, enquire, inspect, make an offer and buy – they are totally different things. So, we have to try and get them to think about it more as an investment,” Mr Samoun says.  

“I often describe a business as a living dynamic beast – you’re not actually buying bricks and mortar or a freehold, but essentially a living entity that will grow and change in response to your inputs.” 

Unlike the largely transactional nature of real estate, business vendors also have a vested interest in its ongoing success under the new owners – making them a valuable resource to leverage post acquisition. 

“A business vendor wants to see the buyer succeed and do well. They have often built the business up over 10 or 20 years and don’t want to see their loyal customers let down,” says Mr Samoun. 

“I have never met a vendor and sold a business from someone who has not wished the business to go on and prosper.”  

Both Mrs Tamvakologos and Mr Samoun concur that their biggest piece of advice for anyone purchasing a business is to do thorough due diligence, with the help of reputable legal, accounting and financial advice. 

“As with a property or indeed any major purchase, it’s important to shop around, obtain good advice and be very clear on exactly what you are getting for your money,” says Mrs Tamvakologos. 

“Similar to perusing property listings on the major portals, business listings sites like AnyBusiness.com.au have filters that allow you to search businesses by industry, price and location. And just like buying a home, a business is somewhere you will spend a great deal of your life – so it’s important to also pay a visit in person before signing on the dotted line, to ‘feel’ it and know that it will be a place you will enjoy.  

“It shouldn’t be purchased on emotion, but it should be somewhere you – as well as your future customers and staff – can feel positive and upbeat.” 

Business vs property – core similarities 

• The need for good advice from your agent/broker plus reliable accounting, legal and financial advice. 
• Negotiations should be based on the business case, not emotion. 
• Presentation is important – know the difference between quality assets and quick makeovers.  
• Listings websites are a great place to find and compare current opportunities – e.g., AnyBusiness.com.au for business listings, Domain or realestate.com.au for property listings. 

Business vs property – key differences 

• Investment risk is higher in business, but the cost to entry is generally lower. 
• Businesses have uncapped revenue and earnings potential. 
• Proper due diligence is even more important for business. 
• People impact business value – customers and employee satisfaction, supplier relations, relationship with vendor. 

Putting off awkward client conversations is costing accountants over $100k each year. New research by Ignition uncovers the financial and human cost of avoiding or delaying awkward client situations in the professional services industry.

According to 97 per cent of accountants and bookkeepers surveyed in a new report, unrecovered out of scope work is costing Australian firms on average over $100,000 each year. What’s more, by putting off awkward client conversations, 43 per say their mental health has suffered.

The new findings in the ‘2022 State of Client Engagement’ report released by Ignition, the world’s first client engagement and commerce platform, shines a light on the financial and human cost to accounting and bookkeeping firms by avoiding or delaying awkward client conversations. Conducted by YouGov, the study interviewed 557 key decision makers in accounting and bookkeeping firms with 1-50 employees in Australia.

“As a former accountant, I’ve experienced my fair share of awkward client conversations,” said Guy Pearson, co-founder and CEO at Ignition. “For many accountants and bookkeepers, the fear of losing a client and the potential impact to the firm causes them to put off having these awkward conversations. We now know this has the opposite effect, with detrimental impacts to their firm, their people and their health and wellbeing.”

Awkward client situations a mainstay in the professional services industry

In Australia, nine in ten (93%) of accountants and bookkeepers have encountered an awkward client situation, with accounting professionals naming the following as the most awkward:

● 78% having to chase clients for late payments

● 76% advising clients that the work they have requested is out of the agreed scope

● 73% finding errors in the client proposals or engagement letters sent manually

On average, one in two accountants and bookkeepers encounter these awkward client situations at least 2-3 times in a month. The most common awkward situations encountered each month include:

● 53% not billing clients for out of scope work

● 51% chasing clients for late payments

● 51% commencing client work without a signed letter of engagement

● 50% sending clients proposals or letters of engagement with errors

Avoiding or delaying awkward client conversations is the norm

In Australia, 95 per cent of accountants and bookkeepers said they have delayed or avoided having an awkward conversation with a client, with 72 per cent saying they were trying to improve or maintain the client relationship. According to respondents, the top barriers to having an awkward conversation are:

● 41% are concerned about the clients’ negative response or reaction

● 37% lack the confidence to confront the client

● 35% lack the information needed about the agreed scope of work

● 33% lack the the skills needed to negotiate with the client

For many accountants and bookkeepers, the fear of losing a client is stronger than the desire to confront or negotiate with a client. In fact, two in five (41%) accountants and bookkeepers have gone so far as to write off all or part of an invoice to avoid having an awkward conversation with a client. When managing increases in the scope of client work, 35 per cent admit they just absorb the increased time and costs themselves.

Avoiding awkward client conversations incurs financial costs

By putting off awkward conversations, accountants and bookkeepers in Australia have traded short-term comfort for the long-term health of their firm. The top financial and business consequences include:

● 41% experienced a loss of potential income for the business

● 36% saw a negative impact to the quality of the work

● 31% faced cash flow pressures

● 23% had to shut down part of the business due to profitability issues

On average, accountants and bookkeepers estimate that out-of-scope work that hasn’t been fully billed is costing their business $8,648 each month. That equates to more than $100,000 each year. In addition:

● 95% experience late payments

● 40% of client invoices are paid after the due date

● On average, client invoices are 31 days overdue

“Overdue client invoices are endemic to accounting firms,” said Pearson. “What the research tells us is that accountants are unwilling to confront clients about bills owing, so they absorb the costs themselves. “In a high inflationary environment, where cash flow is king and a vital ingredient for business survival, firms can no longer afford to put off these client conversations or leave their outstanding payments to chance.”

Avoiding awkward client conversations is taking toll on mental health

Of accountants and bookkeepers that avoided or delayed awkward client conversations, two in five (43%) said it had a negative impact on their mental health and others in the practice. They also report:

● 42% report staff are overworked

● 37% report staff have taken sick leave or time away from work

● 35% report low morale among staff members, as well as resentment (35%)

● 33% report staff have quit and they have difficulty in retaining staff

To learn more, you can find the full report here.

About 48 per cent of all new Australian business start-ups fail within the first four years, and just 77 per cent make their first anniversary, according to new data released by the Australian Bureau of Statistics (ABS).
However, the potential for failure isn’t deterring record numbers of Australians from getting into business – and the majority are doing it on their own.
In 2021-22, of the 473,000 new businesses that commenced, just 25 per cent had employees.
RSM Australia Director of Business Advisory Philip Price said non-employing businesses – which covered sole traders and partnerships without employees – comprised 60 per cent of the 2.6 million businesses operating at the end of June 2022.
Despite it being an ‘employee’s job market this new data shows Australians are prepared to take the risk and set up their own business,’’ Mr Price said. In a reflection of Australia’s tougher economic climate and current skills shortages, the number of non-employing businesses increased by 10 per cent in 2021-22, with a net movement of 15,000 surviving businesses changing their status from employing to non-employing,’’ he said.
‘’Interestingly, the reverse happened in 2020-21, when employing businesses increased by 14 per cent, with 58,000 surviving businesses changing from non-employing to employing,’’ he said.
‘’The tightening labour market skills shortage is exacerbated in the current economic and business environment as individuals start new businesses in big numbers.”
However, Mr Price issued a note of caution to Australians who may be unhappy in their current jobs and are considering setting up their own business.
Unfortunately, the survival rate of new non-employing businesses is poor with just 74 per cent still operating after the first year and only 47 per cent still standing after four years,’’ he said.

‘’This compares with a four-year survival rate of 72 per cent for new businesses with 20-199 employees and 70 per cent for businesses with 5-19 employees.’’

Mr Price said sole proprietorships with one owner – also known as sole traders – also had similarly low new business survival rates with only 43 per cent still operating after four years.

‘’Being a sole trader may be the simplest and cheapest business structure to set up, but it’s not the most protective or successful,’’ he said.

‘’These types of entities are risky because they offer no asset protection, with the owner having unlimited liability for all debts accrued.

Do the groundwork to avoid a start-ups fail, first by putting together a business plan and seeking expert advice on the best legal structure to use.”

One in five Australians encounters scams on a daily basis. Avast provides us with the top tips to spot a scam.

A quarter (25%) of Australians encounter scams on a weekly basis, according to research commissioned by Avast¹, a global leader in digital security and privacy. The new research reveals the extent of the scamdemic currently facing Australians with three-quarters experiencing a spike in attempted scams in the last 12 months, and one in five (19%) being targeted by scammers at least once a day.

Historically, email has been the main means by which scammers target their victims, however that risk has now spread to multiple communications channels, with the research showing scams are reaching Australians mainly via email (78%), text message (75%), phone calls (66%), messaging services such as WhatsApp or Facebook Messenger (36%), and social media (31%).

While Avast’s research reveals that most Australians (84%) believe they can identify a scam, with 3 in 5 (61%) confident they wouldn’t fall for one, the Australian Competition and Consumer Commission’s (ACCC) Scamwatch tells a different story. Australians have reported over $336 million lost to scams in 2022 (July), compared with $323.7 million over all of 2021, which was already a staggering 84% increase on 2020.

Stephen Kho, cyber security expert at Avast says, “We are in the midst of a scamdemic, and there is a clear disconnect between Australians’ perceived confidence in ability to identify a scam and the increasing amount of money being lost to scams every year. In reality, this is being further fuelled by our own fear of embarrassment, with half (50%) of Australians admitting they would feel embarrassed if they fell for a scam despite the prevalence and sophistication of some of these scams, as scammers get sharper with their tools and scams become increasingly more targeted to individuals’ situations.”

The research shows that nearly nine in ten (89%) respondents agreed that online scams are becoming much more sophisticated, and 44% feel scams are increasingly becoming more personal and targeted. Many (45%) admit that they would be more likely to fall for a scam that addresses them personally by name.

“The best tool we have for combatting this scamdemic is to make a unified effort to speak up about our experiences to help educate others on what to look out for, as scammers become craftier and target us in new ways every day. We need to destigmatise the experience of being scammed,” Kho says.

As experts in digital security and privacy, Avast has created the Scamdemic Centre to help educate digital citizens around scams and trigger important conversations and knowledge sharing with family and friends.

“The vast majority of Australians (85%) agree that there needs to be more education around how to avoid falling for a scam, and Avast’s Scamdemic Centre is aimed at playing a role in that while encouraging Australians to share their experiences to further educate the wider digital community and help tackle this ever-growing issue,” explains Kho.

The three main reasons Australians believe scams are becoming increasingly difficult to spot are advanced technology being readily available to scammers (73%), the many ways scammers can gain access to their victims’ personal information (i.e. text, email, social media) (62%), and the belief that people share too much information online, making them ‘easier’ targets in the eyes of cyber criminals (60%).

“Australians recognise that people are getting complacent with their online security (44%), but with free digital security products like Avast One, this is easily rectified.

“Avast truly believes in prevention, as it is difficult to recover financial losses after being deceived into handing them over to bad actors,” Kho continues.

Tips to help you spot a scam:

• The sender’s name is vague, and the email address is long or convoluted
• The sender’s phone number is international or an unknown local phone number
• The email or message is attention-grabbing or alarmist
• The call you have received is from an unknown number with a robo speaker
• The email or message urges immediate action of some kind
• The email, message or call cites some pretence for seeking your personal information, including asking you to log in or confirm your details on a website
• The email or message requests payment or a transfer of funds
• The email or message urges you to click hyperlinked text or a link without clarifying where you are clicking

The Scamdemic Centre can be found here: https://www.avast.com/en-au/avast-scamdemic-centre#pc

About the research:

¹ The survey was conducted by Pureprofile on behalf of Avast, between 6th June and 8th June 2022, with a nationally representative sample of 1,010 respondents in Australia aged 18-65+ years old.

FLK IT OVER enables property keys to be logged and photographed in a SaaS platform that enables managers to follow up.

A week manning the reception desk to cover Covid staff shortages led FLK IT OVER CEO and Founder Andrew Colagiuri to create a new system for property keys, which he believes is a game changer for property managers. 

“During Covid when the lockdown was introduced for select Sydney suburbs eleven of my fourteen staff were affected, so I chose to man the reception desk and experienced first hand how outdated the check-in and out system for property keys is,” says Mr Colagiuri.

“Like most businesses at the time, there was no option but to roll up the sleeves and do whatever was needed to keep the business going, this meant spending some time on reception,” said Mr Colagiuri. 

“After some research we found most offices still using a checkout book, or excel spreadsheet so there was definitely an appetite for an updated system that not only tracks keys, but works seamlessly and delivers a great experience for their trades who often hold keys and return when they are back in the area,  not knowing the urgency .”

Trades are busy, and on the road a lot so writing messages or answering their phone can be tough which leads to a lot of unnecessary back and forth, but with our smart sms conversations it’s so quick and efficient for them to keep the agent informed and updated.”

“FLK A KEY is an extension of the e-document signing tool FLK IT OVER, that enables keys to be logged and photographed in the platform and an overdue section enables managers to quickly see what keys need to be followed up.” 

“When keys are overdue a text message is sent to any trades or tenants to notify them their keys need to be handed back, FLK A KEY has an automated conversation on the agent’s behalf via sms. It then emails this conversation to the agent. It’s all about using technology to deliver efficiencies .”

“It enables those with the overdue keys the ability to respond with the touch of a button explaining the delay or date of intention for returning the property keys.”

“This puts an end to chasing the return of keys with endless phone calls and the technology makes it very simple to see who needs reminding to return the keys.”

“Chasing 10 outstanding keys can take upto 30min of phone calls and back and forth, now they can let FLK A KEY do that for them and move on to dollar productive activities.”

“When keys go missing, it costs time and money (and sometimes the client) so we want to make sure we remove all three issues for agencies.”

“If the agency has 300 rental properties and uses this technology rather than manually updating the traditional spreadsheets and endless phone calls they usually have 20-30 keys out at any time so the time save nature is massive, plus it’s a great customer service experience.” 

“If agencies want to increase profits they will need property managers to manage more properties and the only way they can do this is through improving efficiencies by using the latest technology.” 

“Since its launch four years ago over 500 real estate agencies are actively using FLK IT OVER, including ASX listed McGrath Estate Agents, translating to 100 percent year on year growth with six figures a month in recurring revenue.” 

“Over 4,500 active property managers are logging in every month to use the system with around 13,000 real estate documents a month.”

“FLK A KEY is available now for property managers to use in conjunction with the FLK IT OVER software.”

Consumers are embracing digital payment methods and recognise the potential for biometrics to offer security and convenience when making digital payments. 

However, overall comfort remains low with BNPL and crypto, with adoption hindered by a lack of understanding and pessimism. 

New data from Mastercard’s 2022 New Payments Index Report reveals that more than half of consumers (58%) say that using biometric technologies for identity is more secure than a PIN, password, or another form of identification. 

However, 74% of consumers are concerned about what entities have access to their biometric data.

Key Australian findings from the 2022 New Payments Index report include: 

• Digital payments have momentum
  • Consumers are making purchases in diverse ways with 9% of consumers having bought something using IoT/“smart” device, and 6% using voice assistant platforms
  • Currently, 17% of Aussies are comfortable using cryptocurrency to pay, and 21% have said they will likely use in the next year
  • 34% of consumers are comfortable sharing financial information with apps to have access to payment tools that help them manage their money
• The next frontier in payments
  • 51% of consumers agree they would use cryptocurrency more if they understood it better (+7% from 2021)
  • 26% of consumers have done at least one crypto related activity in the past year: 
  • 21% of consumers have bought crypto in the past year, 21% have held crypto as an investment, 19% have opened/used a crypto wallet
    • Of crypto users, 51% have increased their usage in the past year
    • 62% of consumers agree the government should regulate the cryptocurrency and stablecoin industry
• A balance between security and convenience
  • More than half (51%) believe it is easier to make payments using biometrics than a card or device
  • 63% believe using biometric technologies is easier than remembering PINs/passwords. However, 74% of consumers agree they are concerned about what entities have access to their biometric data
  • 52% of consumers believe that using biometric technologies for payments is more secure than two factor authentication
  • Biometric data used or planned to use to make payments include fingerprint (49%), facial recognition (45%), voice recognition (39%) and palm/hand (32%)
• Planning for payments (BNPL)
  • Consumers are open to using BNPL particularly for large/emergency purchases; however, only 42% are comfortable using BNPL today 
  • 60% of consumers agree they would feel safer using a BNPL solution backed by a major payment network than from other providers

Australian small businesses record the highest jobs growth in 11 months, despite a slowdown in sales.

Xero, the global small business platform, today released its latest data on the health of Australia’s small business economy during July from the Xero Small Business Index. Based on aggregated and anonymised transactions from hundreds of thousands of small businesses, the Index, developed in collaboration with Accenture, is part of the Xero Small Business Insights program.

Xero’s Small Business Index fell 40 points in July to 111 points and now sits around the 2021 average. The big swings in the Index over June and July largely reflect volatility in the time to be paid metric, as a result of the end of the financial year in June. July also saw sales growth slowing to 7.5 percent year-on-year (y/y), a 4.1 percent y/y rise in jobs and wage growth marginally higher, at 3.6 percent y/y.

Joseph Lyons, Managing Director Australia and Asia, Xero, said: “Small businesses remained resilient in the face of inflation and other supply chain challenges according to the July index. In fact, we’ve seen the strongest jobs growth in almost a year, even across industries like hospitality and agriculture, which have recently struggled to find talent.

“While inflation is impacting small businesses globally, our data shows that Australian small businesses are faring slightly better compared to those in New Zealand and the United Kingdom in terms of sales. While this doesn’t mean it’s smooth sailing for local small businesses – as most can attest to – it’s promising to see an overall above-average result, especially for sectors that have been doing it tough,” says Lyons.

Strongest jobs growth result since August 2021

Jobs rose 4.1 percent y/y in July – the largest rise since August 2021. This is above the long-term average of 3.0 percent y/y for the Xero Small Business Index series, meaning jobs growth has now been positive for three consecutive months.  

Looking at the states, July saw Tasmania record positive jobs growth (at 1.8% y/y) for the first time in 7 months while New South Wales led all states at 7.7 percent y/y.

All industries reported positive jobs growth, including hospitality (+8.6% y/y), which had recorded falls in jobs for the previous six months. Information media and telecommunications (0.8% y/y) and agriculture (0.2% y/y) reported the lowest figures, while arts and recreation led all industries at 11.1 percent y/y, a significant result given a tough couple of years due to COVID-19 restrictions.

Wage growth did not rise significantly, despite the minimum wage increase

Despite the annual increases in minimum wage (5.2%) and award wages (4.6%) that came into effect on 1 July, the wage result suggests that there has not been a material impact on aggregate wage costs. Wages grew by 3.6 percent y/y, up from 3.4 percent y/y in June.

Across industries, health care continues to record the lowest wages growth, at 2.7 percent y/y whereas information media and telecommunications was the leading industry in terms of wage growth, at 4.3 percent y/y.

“July was the first month of the new financial year where the increase in minimum and award wages was in place and we didn’t see a significant effect. We will get more award wage information in October when the award wage rise comes into effect for the hospitality industry,” says Louise Southall, Economist, Xero.

Cost of living pressures see sales continuing to fall

The main area of concern for July is the slowdown of sales growth, which slowed again to 7.5 percent y/y, from 11.4 percent y/y in June. Many Australians are facing cost of living pressures as prices rise faster than wages, causing a flow of effect when it comes to spending in small businesses across the country.

“When prices are taken into account, using the June quarter Consumer Price Index, it suggests that the volume of sales rose a smaller 1.4 percent y/y (down from +5.3% y/y in June). But this means small businesses still sold more goods and services in July 2022 than they did in July 2021,” said Southall.

“This is different to the experience of small businesses in other countries like the United Kingdom and New Zealand, where sales, excluding price impacts, have actually declined for June and July.” 

New South Wales (12.9% y/y) and South Australia (10.7% y/y) led all states with double digit sales growth. Hospitality (+21.6% y/y) and arts and recreation (+22.6% y/y) were the leading industries in terms of sales in July, again another positive reflection that the arts and recreation sector is returning to full strength.

Time to be paid rose 2.7 days to 23.2 days

The average wait time for small businesses to be  paid rose 2.7 days in July to 23.2 days. This follows a 3.0 day fall in June, which was largely due to the end of the financial year when this metric usually experiences a large improvement, hence the reversal is not unexpected. 

There was a 1.6 day rise in late payments to 6.5 days after a record low of 4.9 days in June, which was also impacted by the end of the financial year.

Go to the website to download the full July results, including industry and regional breakdowns. See the methodology to learn more about how the Xero Small Business Index is constructed.

As Australian businesses face staff shortages and rising inflation, new data from Australia’s largest business organisation, My Business, shows more than half of small business owners don’t have an exit strategy.

The first findings of the ‘Recipe for Success Survey’, of nearly 2,000 Australian business owners, found that of those that did have a strategy, 41% plan to sell their business to another organisation, 20% plan to leave it to a family member and 15% intend to eventually close down.

Richard Spencer, Chief Customer Experience Officer at My Business, who is releasing the survey data this week at the My Business roadshows, says it’s important to map out a business exit strategy – even if you’re not planning on leaving anytime soon.

“The survey tells us 59% of respondents don’t have an exit strategy and even more (75%) didn’t have one before starting their business,” says Mr Spencer.

“Without a clear plan for how you will steer the business, and eventually wind up your involvement, you may end up selling the business for less than it’s worth.”

“The whole process can also end up being a lot harder than it needs to be – often business owners are left scrambling to get things in order.”

Top 3 things to consider when preparing an exit strategy for your business:

1. Plan for the future you want: Don’t just create a business plan but plan what you want from your business as an owner. 35% of respondents were not entirely clear on what they wanted to achieve from owning their business.

2. Get your business valued: Our data found that only 1 in 5 businesses have a formal valuation of what their business is worth. 40% are simply guessing what their business is worth!
3. Actually write an exit strategy: 60% of respondents did not have an exit strategy. Business owners tend to be more likely to benefit from owning a business if they plan their exit as early as possible. Plan your way out as carefully as you planned your way in.

The survey also found that small business owners have a greater appetite for risk than the general public and were also more inclined to be both goal oriented and self-motivated.

The survey responses consisted of 1,850 small business owners and also 2,047 members of the general public and compared their attributes.

“The other major personality trait we noticed that was more prevalent in small business owners was a commitment to lifelong learning,” says Mr Spencer.

“We undertook the survey to gain more insight into what attributes makes a successful businessperson so we can empower other owners on their business journey and focussing on continued development and constantly learning, growing and adapting are key to success,” 

“Of the business owners surveyed the majority of them were female, aged between 34-44 years old and nearly half had been in business longer than 5 years.” he says.

Survey Source: ‘Recipe for Success Survey’ Conducted by My Business & Pure Profile – August 2022

My Business ‘Recipe for Success’ Roadshow Dates