Westpac local business sentiment survey. December 2011 by AMR

Transcription

1 Westpac local business sentiment survey. December 2011 by AMR Region Report Regional Western Australia

2 Executive Summary Overall business sentiment index Regional Western Australia 60/100 The Westpac business sentiment index is the measure of small and medium business sentiment in Australia, who comprise 97% of all private sector businesses and employ 3.6 million people. In September 2011, 2,000 small and medium business owners participated in the second Local Business Sentiment Survey commissioned by Westpac, to provide an insight into business owners sentiment based on their perceptions of current and future business performance. The majority (68%) of businesses in Regional Western Australia report good or very good performance e compared with 6 months ago in March 2011 (63%). This is higher than other business across Australia (57%). Business owners in this region report similar levels of optimism to the last 6 months (51% compared to 55% in March h). This is also higher than other businesses across Australia (46%). In comparison, happiness in this region has slightly increased (69% compared with 6 in March) and, similar to performance and optimism, is higher than Australia overall (61%). The greatest difficulties faced by businesses in Regional Western Australia are managing business costs (21%), managing finances (15%), marketing and promotional activities (13%) and determining prices (13%). As experienced by other business owners across Australia, the most difficult financial factor is managing cash flow (46%). The latter is not surprising given that a third (34%) of businesses in this region report not having a cash flow budget. Despite these challenges, the majority of businesses in this region anticipate their profits for the next 6 months will increase (45%) or at least remain the same (49%). Metro Western Australia 56/100 Overall business sentiment index is a score out of 100 that shows how local businesses are feeling. The score is a combination of their perceptions on current and future business performance, difficulty of running a business and general happiness. Business performance in Regional Western Australia is higher than other businesses across the state. Optimism in the region remains stable, which places it above Australia overall. Correspondingly, happiness levels in this region have increased over the last 6 months. Score card Australia 57% 37% 41% 46% 61% 56/100 Regional Western Australia Business performance is good / indicates significant difference to Mar 11. Business performance is better than last 6 mths Running a business is more difficult than last 6 mths Predict better performance in next 6 mths Are happy as business owners Westpac Local Business Sentiment Survey Overall business sentiment index 62% 4 39% 46% 64% 58/100 68% 41% 37% 51% 69% 60/100 01

3 Business performance: influencing factors Top 3 positive and negative local influences on business Top 3 positive and negative national influences on business Positive Local consumer confidence Local competitive landscape Quality of local utilities/comm's Negative Negative Cost of local real estate/leases Access to local skilled workforce Local consumer confidence -38% -35% -31% 21% 31% 3 Positive Australian dollar Consumer confidence Competitive landscape Negative Negative Supply costs of goods and services Consumer confidence Government regulations/legislation -11% -24% -15% 15% 14% 8% Positive influences on business "Increase of community facilities and drive of community spirit." "We have a great deal of repeat business due to our good customer relationships." Property & Business Personal & Other Services Services "Fast turn-around and local word of mouth. Low running costs of our business is passed on to our customers." Personal & Other Services Negative influences on business "Cost of housing workers from other areas is extremely expensive." "People are more reluctant to spend their money." Construction Accommodation, Cafés & Retail Trade Restaurants "GFC has had a negative influence on luxury goods retail." Westpac Local Business Sentiment Survey 02

4 Running a business Difficult overall factors in running a business Managing business costs Managing finances Marketing & Promotional activities Determining prices Managing employees Adhering to regulations Driving sales/revenue Planning strategy Executing strategy Customer service Other 11% 11% 1% 1%4% 8% 13% 13% 21% 15% Difficult financial factors in running a business Managing cash flow Management of GST & business tax provisions Managing debtors Access to finance Managing employee entitlements 46% 38% 29% 29% 29% Main sources of business advice General business advice Financial advice ONE TWO THREE My own experience/ research Accountant Accountant My own experience/ research Business mentor Bank Manager Managing creditor repayments 17% Budgeting 13% Determining prices Other None 13% 25% 5 75% Westpac Local Business Sentiment Survey 03

5 Financial management Future profit outlook 3% How often do business owners compare their cash flow budget to actuals? Increase Decrease Stay the same Unsure Main reasons for change in profit* Increase Reduced costs Increased revenue Both Decrease Increased costs Reduced revenue Both -48% -44% 49% -8% 3% 3% 31% 45% 66% -5-25% 25% 5 75% Main reasons for not having a cash flow budget 75% 5 25% Monthly Quarterly Annually Never I don't have a cash flow budget 8% 13% Don't have the time to create one Don't know how to create one 34% 6% 8% 58% 14% Don't need one 38% Other * Base size for Regional Western Australia is too low to report so above chart shows data. Westpac Local Business Sentiment Survey 04

6 Social media within business How are businesses using social media? Benefits of social media Take every opportunity to use social media tools Use social media where they can, but would like to know more Not currently utilising social media, but would like to in the future Have considered using social media, but it is not for them Not utilising any social media as they don t know much about it Unsure 1 32% 14% 17% 18% 8% Marketing/promoting products and services Raising profile of business Building customer relationships Connecting with wider audience Customer feedback on products & services 42% 42% 52% 71% 77% Top 3 reasons organisations are not currently making full use of social media 75% Improving service delivery Reducing business costs Finding/attracting staff Other 26% 23% 19% 5 25% 46% 46% 27% None 3% Lack of expertise Lack of time Lack of perceived value Westpac Local Business Sentiment Survey 05

7 Happiness level of business owners Sadder Australia Sep '11, 61 Regional Mar '11, 60 Australia Mar '11, 60Mar '11, 62 Sep '11, 64 Regional Sep '11, 69 Happier Top 3 aspects that have influenced those who are happy and sad Why so sad Costs/ Overheads Economic outlook Paperwork "Cash flow has been extremely depleted which has been a worry. To keep cash flow we have had to change strategies to make improvements." Accommodation, Cafés & Restaurants Reasons to be happy Customer relationships Personal goals Business relationships "Solid financial position always helps the road to happiness. Our bank has helped this year with our ability to grow our business with new business banking structures." Agriculture, Forestry & Fishing Westpac Local Business Sentiment Survey 06

8 Strategic business advice "Consumer confidence and price WILL eliminate a large proportion of your market, but maintaining reasonable margins and EXCELLENT service will ensure a profitable market share." Construction "Encourage our employees to provide the best service to our customers." Manufacturing "Attention to detail and doing a little bit extra to keep customers happy." Construction "Trending towards seasonal work and having employees take leave during winter months." Property & Business Services "Private rental of large houses for accommodating the workers has been our practice to date. It is less expensive than camp accommodation." Construction "Keep out running costs to a minimum and pass it on to the consumer. Keep our advertising to key targets." Personal & Other Services Westpac Local Business Sentiment Survey 07

9 Business sentiment trends Overall business sentiment index Business performance is good Business performance is better than last 6 mths % 65% 57% 62% 63% 68% 4 44% 45% 42% 37% 4 41% 0 Australia Regional Australia Regional Australia Regional Running a business is more difficult than last 6 mths Predict better performance in next 6 mths Are happy as business owners % 41% 39% 37% % 6 46% 46% 55% 51% % 62% 64% 6 69% Australia Regional Australia Regional Australia Regional Fieldwork was conducted by AMR, an independent research company, between 16th September 2011 and 10th October 2011, where a total of n=2000 online surveys were completed. Sample was supplied by Westpac of customers and non-customers qualifying as Small Medium Enterprises. Westpac Local Business Sentiment Survey 08

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