Key findings: Australia's shifting business ecosystem
As of June 2024, Australia has over 2.66 million active businesses, showing a 2.8% increase from the previous year – new business entries stand at 16.8% and exits at 14.0%.
In a tough economic climate for doing business, specific trends can be seen across various industries. For example, Australia’s transportation, postal and warehousing sectors (8.5%), healthcare and social assistance (7.7%) and financial services (4.8%) have grown substantially, likely due to increased demand or changes in consumer behaviour following the pandemic.
In contrast, agriculture, forestry and fishing have taken a hit, down 1.3%, whilst the number of retail businesses are also down slightly, at a 0.2% decrease.
The ABS figures highlight a rise in non-employing businesses, suggesting an increase in solo entrepreneurship and freelance work – presenting traditional businesses with more opportunities to tap into this growing pool of talent to provide flexible, on-demand expertise that might not be available in-house.
Simultaneously, employing businesses, especially larger ones, have also grown, demonstrating the economy’s adaptability despite the challenges that have arrived in the post-COVID-19 world.
Gaining an edge: understand your industry and region
The ABS data highlights the need to track industry-specific and regional trends. Businesses in healthcare, transport and finance, for example, may need to scale operations to meet rising demand.
Conversely, sectors like agriculture and retail, which have seen slight declines, may need to adopt new strategies to remain competitive and attract customers.
By examining these trends and understanding your industry and region, SMEs can make informed strategic decisions. This knowledge can help you identify market gaps, target new customer segments, or adjust your business model for growth.
Adapt to change: build business resilience
The Australian economy continues to change, influenced by shifting consumer habits, global events and technological advancements – which emphasises the need for SMEs to adapt.
Staying informed about industry and market trends allows you to anticipate changes and adjust your business model accordingly. Embracing technology, upskilling and exploring new market opportunities can help you build organisational resilience during uncertain times.
Understanding your target audience’s needs and preferences can also guide your product development, service innovation and marketing strategies. Your ability to adapt, remain flexible, as well as anticipate market trends will help you navigate evolving economic and market conditions.
Partner for success: work with small business advisors
The Counts of Australian Businesses, including Entries and Exits data provides valuable information on businesses entering and exiting the market – and during one of the toughest periods for businesses in more than a decade.
With insolvencies reaching record highs at 11,053 external administrations in FY2023–24 – up 39% from 7,942 in FY2022–23 and 2.7% from 10,757 in FY2011–12 – working with experienced business advisors can offer additional support.
Small and medium business advisors can help you analyse your business model and industry data to uncover opportunities and areas for improvement. For instance, they can assist you in developing and implementing strategic business plans, including finding funding options, improving operational processes and exploring new markets.
Insolvency experts and corporate advisors that specialise debt in management, like AVA Advisory, can also assist business owners in restructuring their debts to allow possibilities for business continuation and potential future growth, even in adverse conditions. By helping you monitor key metrics and economic trends, directors and business owners can stay ahead of the curve and receive data-driven advice on adjusting their strategy promptly as market conditions change.
Stay informed and adaptive: look to the future
Understanding Australia’s current economic situation and unfolding trends is essential for business owners. Doing so will help you find ways to do business smarter and take steps to plan, prepare and prevail in these high-inflation, post-pandemic times – where businesses are juggling mounting pressures and on multiple fronts.
Analysing industry-specific and regional performance, for instance, can help you address market gaps and seize emerging opportunities.
Embracing adaptability, focusing on skills development, as well as investing in proven new technologies to build a resilient business can also help your business thrive.
We partner with businesses to ignite future-forward growth
At AVA Advisory, we understand the unique challenges faced by small and medium businesses – from enduring high-inflation, weaker demand, trading challenges and skills/staff shortages to the cost-crisis in doing business.
By offering expert advice, tailored support and correctly-structured solutions, we help business owners navigate complex decisions, manage risks and capitalise on opportunities.
Whether you’re looking to understand the latest industry trends or need guidance on strategic planning, AVA Advisory is here to support your journey towards sustainable growth.
Contact AVA Advisory today on 1300 181 220 for a private, pressure-free discussion, or book a consultation online.
