Confidence among small business exporters is on the rise.
The latest Efic’s Exporter Sentiment Index, shows SMEs are increasingly confident about international opportunities.
More than half of small business exporters surveyed (57 per cent) believe they are in a better financial position than 12 months ago – an increase of six percentage points and close to two thirds (63 per cent) are confident that they will be in a better financial position in the next 12 months.
“The increased confidence among Australia’s small business exporters should create new jobs,” said Trade Minister Steven Ciobo.
Nearly half (49 per cent) of respondents expecting to increase their staff numbers over the next 12 months.
The bi-annual index, which surveyed more than 1,200 Australian small and medium exporting businesses, looks at perceptions about current and future economic conditions and the international business outlook.
“All key indicators have lifted significantly since the last survey, which was in market in November 2016,” said Swati Dave, CEO and Managing Director of Efic.
“We have found that confidence among respondents is strong in terms of economic conditions, their financial position and perceived future profitability from international revenue and employee growth.”
Sales revenue to increase
Expectations for future economic conditions over the next 12 months have increased by 10 basis points since the last survey.
Two thirds of all respondents are expecting future sales revenue to increase. Businesses with a turnover of $10m to $100m are even more confident of growth with 70% expecting sales revenue growth from overseas sales.
“The increased confidence is driven by an increased demand in export markets and due to improved sales strategies,” says Ms Dave.
While positive sentiment is significantly higher since the last survey, competition in international markets has increased.
Borrowing will be easier
Access to finance appears to be easing slightly with 34 per cent of respondents saying borrowing money for an overseas venture will be easier in the year ahead.
“However one in five respondents surveyed are expecting finance access to become more difficult – primarily due to the cost of credit increasing and working with financiers that do not understand the complexities of managing working capital through the export cycle,” says Ms Dave.
“It is in cases like these where Efic is able to help with expertise in exporting and the ability to support businesses when their bank may not be able to assist.”
Read Efic's latest exporter sentiment index here.