With the motivation of being your own boss, tailoring your own hours and making entrepreneurial dreams a reality, small business owners are continuing to dominate the Australian economy, making up whopping 99.8% of all Australian businesses. Like any playing field that has a lot of participants, this makes the small business domain a very competitive space and incredibly tough on beginners starting out – in fact 50% of new businesses don’t survive.

Whether you’re an entrepreneur or seasoned business veteran, one can never have too much wisdom. So to help sharpen your edge, we’ve compiled some of the latest data to give you more insights on the small business landscape, to empower you to make more conscious decisions and set you up for long-term success.

Interesting Start-ups & Small Business Statistics

Understand where the current small business landscape is at, the numbers surrounding the average small business loan and the average age of small business owners in Australia.

• There are 2.36m small businesses in Australia (Source: SBDC Western Australia)
• 64% of small business owners begin with only $10,000 in capital (Source: SmallBizGenius)
• Half of small business owners are between 50 and 88 years of age. (Source: Smallbiztrends)
• Only 64% of small businesses have their own website. (Source: SmallBizGenius)
• 92% of small business owners don’t regret starting their own company (Source: Findstack)
• The average small business loan is worth $633,000. (Source: SmallBizGenius)
• Small businesses with two founders raise 30% more money on average. (Source: SmallBizGenius)
• 82% of businesses fail because of inconsistent or insufficient cash flow. (Source: SmallBizGenius)
• 23% of small businesses fail because they don’t have the right team running the business. (Source: SmallBizGenius)
• 29% say their motivation for starting a business was to be their own boss. (Source: Semrush)

Post-pandemic Business Statistics

How has the global coronavirus pandemic affected small businesses and the mindsets of those in charge

• When asked about the top challenges of running a business, 29% of small business owners said that it’s handling the impact of the coronavirus. (Source: Fortunly)
• Businesses with only 1-4 employees were the most severely impacted by the pandemic (Source: Business Wire)
• 30% of pandemic entrepreneurs say they’ll never open a physical store (Source: Salesforce)
• 1/4 of businesses expect to recover from the pandemic in less than 6 months (Source: ZenBusiness Survey)
• 70% of small enterprises anticipated taking financial aid. (Source: Semrush)
• The average small business with monthly expenses over $10,000 only had enough savings to last roughly two weeks. (Source: Semrush)
• Ecommerce sales are higher than ever before after the pandemic caused years of growth in just a few weeks. (Source: Semrush)
• Over half of small businesses with 2-10 employees now offer remote work as an option (Source: ZenBusiness Survey)

Mistakes and Pitfalls To Avoid When Running a Small Business

We highlight some key areas to look out for which are commonly catching out new business owners. What kinds of businesses are most promising to dive into, in the coming decade?

• Only 78.5% of small businesses survive their first year. (Source: Fortunly)
• 14% of small businesses fail because they ignore their customers’ needs, while the same number fail because of poor marketing skills. (Source: CBInsights)
• Only 22% of small businesses encrypt their databases. (Source: Review 42)
• 43% of cyber attacks target small businesses. 60% of those hacked close their doors within 6 months. (Source: Digital)
• 14% of small businesses fail because of poor marketing (Source)
• 28% of data breaches in 2020 involved small businesses. (Source)
• The average small business with monthly expenses over $10,000 only had enough savings to last roughly two weeks. (Source: Semrush)
• For those who have a website, every second matters; if your site doesn’t load in four seconds or less, 25% of those who navigated to your site will have left. (Source: Kissmetrics)
• Small business founders are more likely to succeed if they’ve previously failed than first-timers. (Source: Fortunly)

Innovation in Business

When you’re smaller, you have the ability to mobilise faster than the larger corporations. What key areas are small businesses innovating well in?

• 86% of companies invest in technology to improve their productivity. (Source: Business Wire)
• Technology, health, and energy are the top businesses to start now if you want to be rich in a decade. (Source)
• Businesses that sell services rather than products have a better chance of survival. (Source: Business Wire)
• Online and digital channels will continue to grow. No-touch payments, including contactless cards and mobile payments, increased among small businesses in 2020. (Source: Semrush)
• Remote work is here to stay and will increase 13.5% even after the pandemic. (Source: Semrush)
• 61% of B2B marketers stated that SEO and organic traffic generate more leads than any other marketing initiative. (Source: HubSpot)

5 Key Tips For Small Business Owners

These numbers show that the small business landscape is a promising one, but there are key things to get on top of, to ensure that your small business conquers the odds.

From the data shown, here are our small business tips ensure survival, consider:

• Hire well, and remember you do not need to only hire full-timers. Part-timers are equally invaluable in giving flexibility to your business
• Invest in a good website, it’s an imperative tool for those who want to be well-prepared for any pandemic or global crisis
• Invest in multiple marketing channels to maximise chances of success. Different platforms work better for different industries, don’t put all your eggs in one basket
• Keep up to date with new technologies, systems and software so you can adopt them into your business when required. Streamlining processes and increasing efficiencies allows your business to scale and remain sustainable long-term

The statistics can show us that starting a new business can be daunting, especially with so many factors to consider – staff, remote work, cash flow, funding, product demand, market supply, marketing channels, website maintenance, digital presence and scalability.

However, having absorbed the information, it will hopefully rejig your mental compass and allow you to plan your next steps with conscious direction.

For any specific tips to help your business flourish, call Accountancy Experts and speak to our business planning and accounting specialists.

Our Supporting Resources
SBDC Western Australia, SmallBizGenius, Smallbiztrends, Findstack, Semrush, Fortunly, Business Wire, Zen Business, HubSpot