Australian SMEs show true resilience, most feel they will make it past COVID-19

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With mixed feelings towards recovery, Australian SMEs have shown true resilience with most businessesfeeling they will make it through the COVID-19 pandemic.

Australian small and medium-sized businesses have shown true resilience through one of the toughest years in trade now coming to an end. To get an insight into how businesses are feeling about the year ahead, BizCover surveyed 1,500 SMEs on their thoughts and views of the year and the results are now available through BizCover’s Small Business Bravery 2020 Report.

In 2019 most SME’s were feeling optimistic about their annual performance and were looking forward to improving their business performance during 2020, with only 10% looking at a decline in performance year on year. However, the rapid spread of bushfires in earlier in the year and then the change trading conditions bought on by the COVID-19 pandemic has turned the feeling of optimism into one of negativity, with 36% looking at poorer performance this year.

The Small Business Bravery 2020 Report found that of those SMEs looking at poor trading performance, 92% of them attributed the pandemic for the decrease of their business’ performance with 4% of them having to cope with both bushfires and COVID-19. Sadly, 1% of SMEs were not able to weather the storm and have been forced to shut down permanently. To keep their cash flow going 13% of SMEs started offering different products and services, whilst others improved their operational efficiencies and online capabilities.

Michael Gottlieb, Chief Executive Officer of BizCover, commented, “Australian SME’s were faced with some of the toughest trading conditions we’ve seen, but their ability adapt and supported by both federal and state government initiatives have placed many of them in a strong position for recovery.” 42% of SMEs saw a reduction in work and/or customer flow with a further 21% reporting having to stop activities due to COVID-19. Victoria reported an additional 8% of SMEs being forced to shut down during its second lockdown. Supported by the government, many SMEs utilised the different economic packages released during the pandemic, with 50% applying for JobKeeper economic assistance and 12% accessing state government grants.

“Whilst the next few years are still very uncertain, small businesses have shown their resilience and are they are generally optimistic about recovery in the new year ahead. It is up to us as a country to continue to support our local small businesses as they represent the heart of our communities and economic growth.” said Gottlieb.

Around 63% of SMEs remain optimistic for recovery in the new year with only 13% are pessimistic about the recovery.

When asked about their state performance compared to other states, 87% Victorians felt that their state performed worse compared to 95% of Western Australians who felt that their state had performed better than other states.

Click here to read the full report

Release ID: 88990509