Results from the latest National Australia Bank’s (NAB) fourth-quarter SME survey have painted a grim picture for small and medium businesses, with business conditions slumping as a result of a deteriorating economy.
Conditions dipped three index points to minus-4 in the December 2008 quarter, the lowest index score since June 2006.
According to NAB regional general manager of business banking, Geoff Greer, SMEs are doing it tough at the moment.
“Business directly affected by the downturn in consumer spending are finding it hard going.”
The report has found that 27 percent of SMEs believe conditions are “poor”, while 23 percent said that things are “good.”
Conditions for small businesses with a turnover between $3 million and $5 million shrank to minus-6 index points.
Greer has pointed out that small and medium sized businesses are anxious for the Government’s $42 billion stimulus package to kick in, with $2.7 billion allocated to small business specifically.
However, Ezypay CEO Trent Brown believes that the Government’s proposed stimulus package will do little to solve the cash flow woes of SMEs.
“The sector will continue to struggle with the fundamental cashflow management issue of an over-reliance on debt and long repayment terms.”
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