Digital enablement and improvement will be a focus for most SMEs in the new year with young business owners driving the trend.
Forty per cent of Gen Y (aged 25-39)-operated businesses achieved more profitability in the past 12 months compared to the national average of 26 per cent, according to the latest MYOB Business Monitor survey, released Monday.
The group is most likely to be digitally enabled, with 84 per cent of respondents having either a website, social media presence or both for their business.
More than half of the cohort were also expecting more profit in the next 12 months.
Of the 1000 respondents to the biannual survey, 35 per cent moved more of their business online after COVID-19 hit.
MYOB chief executive Greg Ellis said adoption of digital tools was a no-brainer.
“It’s no longer a ‘nice to have’ but a critical business decision for SMEs.
“Many businesses would not have survived 2020 without digital tools as they became the only way to connect with customers, colleagues and communities at large.
“2020 proved that we have to stop treating digitisation as a future state.”
Nevertheless, the report highlighted some gaps in adoption with 34 per cent respondents still not having any online presence.
“This needs to change, and it’s why we’re calling for digital incentives, such as rebates, for SaaS (software as a service) adoption to be introduced for businesses to encourage them to get online.”
Confidence among SMEs is growing with 48 per cent business owners believing the Australian economy will improve in the next 12 months – more than double the 21 per cent who held this view in June last year.
But many businesses are still feeling the effects of COVID-19, with 44 per cent reporting lower revenues.
Across the board businesses were feeling less pressure than June last year, though the economic downturn due to COVID-19 remains the top concern for SMEs, with 37 per cent of respondents saying it would cause extreme or quite a lot of pressure.
Customer retention was a top priority for more than a quarter of respondents with 15 per cent of SMEs expecting to increase their investment in full-time employees.
Eighteen per cent expect to increase their investment in part-time or casual employees.