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Aust firms 'more optimistic' about next 12 months

13 October, 2014

Australian businesses are confident about their prospects for growth with the majority predicting an increase in turnover in the next twelve months, according to research published by The Sage Group Plc.

The annual Sage Business Index surveys close to 14,000 small and medium sized businesses in 18 countries around the world, including 723 Australian businesses.

"This is the first time Australian businesses have been included in the global survey. We're delighted with the findings of this research as it sets the benchmark in understanding how confident Australian businesses feel about their prospects and how that compares on a global stage," said Mike Lorge, Managing Director of Sage Business Solutions Australia.

For the first time in four years, businesses around the world were also more optimistic than pessimistic, with scores rising above 50 across all three areas surveyed: their own prospects; their national economies; and the global economy.


Australian businesses are optimistic about their own prospects scoring their confidence at 63.71 points out of 100. They are more confident than many other countries when it comes to their national economy scoring it at 54.52, 2.89 points above the global average.

Similarly, confidence in the global economy was 2.47 points above the global average at 54.15. This suggests that Australian business decision-makers believe that both the national and global economies are improving rather than declining.

Predictions for growth

Australian business optimism also resulted in predictions for growth over the coming year.

Over half of businesses (53 per cent) anticipate their turnover will grow by an average of 0.6 per cent in the next year. Australian small and medium sized businesses also expect to increase headcount by 2.7 per cent over the next year, 0.7pp higher than the global average.

Attitudes to risk

Australian businesses are also seen to be more open to risk. Over half of business decision makers (53 per cent) described themselves as risk-seekers, 4 per cent above the global average of 49 per cent.

Reflecting on the results of the Sage Business Index 2014 Mike Lorge said: "It's encouraging to see this positive business outlook from small and medium Australian businesses which has buoyed the nation's business growth expectations and appetite for risk.

"This is an important indicator as taking risks often paves the way for new innovation."


Among the most confident Australian businesses were those with operations beyond their domestic market.

Nearly half of those surveyed (42 per cent) currently do business in countries outside their own, stating that exports account for 21 per cent of turnover on average.

Indeed, exporters say the last year has been a strong year, with 41 per cent seeing their level of exports increase and just 11 per cent saying they have fallen. Furthermore, businesses expect export turnover to increase in the next year by 3.5 per cent.

However, many Australian businesses do not feel they are supported in their ambitions to grow their exports. Less than a fifth (19 per cent) say they receive the support they need from government, with over a third (34 per cent) saying the one thing the government should do to help them grow exports is to provide greater financial incentives.

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Julie Keong | Wednesday, October 15, 2014, 1:32 PM
Not sure where the business confidence is coming from. We have a small business and deal with many small businesses we have had not one customer singing that confidence song it is more the opposite. Now with the news of Dick Smith Foods - I'm not hearing confidence if Australian Manufacturers etc keep going down who and where will people be employed - " the governments dole queue". Mines? even some of them are closing and with increasing costs to run a business - insurance, wages, super where will it end. The unionists having a go when places close, and next breath want better wages. Need I say more.