It is the best of times, it is the worst of times for small business
Small business is increasingly polarised between those struggling with costs and slow growth and those thriving and investing. For good credits, banks have sharp pencils.
The small business sector is splitting into two camps: those barely surviving and those expanding and borrowing, seemingly oblivious to tough times.
For those doing OK, banks are desperate for their business to the extent tough competition is hitting margins. But official data show insolvencies on the rise.
According to the latest Australian Securities and Investments Commission data, in the nine months to March 2024, 7,742 companies entered external administration, a 36.2% increase compared with the previous corresponding period. The construction sector, with 2,142 companies, and the accommodation and food services industries, with 1,174 failures, were the hardest hit.
Yet speaking with Capital Brief in the wings of CommBank SmallBiz Week, Commonwealth Bank general manager of small business banking Rebecca Warren said there was considerable long term optimism in the sector and a desire to invest – particularly to reduce energy costs.
