businesspeople-clapping-conference-meeting-staff
  by /0 comments

Measuring local business success

Australia has always been an entrepreneurial nation, with business the backbone of the economy and the labour force. Now, a new tracking index created by McCrindle Research enables Australia’s 565 local councils to measure the business conditions, performance and sentiment of our nation’s 2.1 million actively trading businesses, 99.5 per cent of which are small-medium enterprises.

 

External Stress versus Internal Success

The first Business Performance Sentiment Index (PSI) results, featuring 179 business owners from the NSW Hills Shire Council, indicated that businesses face stress in terms of the external factors – the general economic conditions and local infrastructure, with strong concerns about the regulatory burden placed on them:

  • 48 per cent of businesses say Australia’s economy is performing worse than six months ago
  • 40 per cent indicate that the time and cost spent on compliance, legislation and regulations has increased in the last six months

 

manager-secretary-working-office-teaching-notes

76 per cent of small business owners reported an increase in staffing costs in the last six months.

 

Rising costs felt by small business

Internally, performance has yielded good revenue and profitability growth over the last 6 months, and 47 per cent of business owners say their sales revenue is better than six months ago. This is coupled, however, with rising costs of doing business:

  • 38 per cent say business costs are worse now than 6 months ago, and
  • 76 per cent of small business owners (5-19 staff) report an increase in staffing costs in the last six months

 

Optimistic about performance, uncertain about economic outlook

While 42 per cent of business owners expect Australia’s economy to be performing worse in six months’ time, 52 per cent expect their own revenue to be better, with expectations for profitability growth and increased employment. Three in five (58 per cent) also expect costs to increase.

“The Business PSI is designed to be deployed longitudinally in local and regional geographies, as it measures economic conditions, regulatory settings, and infrastructure in a local context,” explains Mark McCrindle, principal of McCrindle Research.

“Business performance can be measured by region over time to get real-time analysis of local economic conditions, and to see the impact of local policies, investment, and infrastructure development, as well as to measure the impact of state and national issues and economic conditions.”

Share this article

Mark McCrindle

Mark McCrindle is an award-winning social researcher, best-selling author and influential thought leader. He is regularly commissioned to deliver strategy and advice to the boards and executive committees of some of the country’s leading organisations. Mark is also founder and Principal of Australian social research firm McCrindle Research.

The opinions expressed in this article are the opinions of the author(s) and not necessarily those of Homeloans Ltd.