What steps are Australian
SMEs taking to combat
their biggest challenges in
FY23?

A Small Business Loans Australia Study

August 2022

What are the biggest challenges SMEs
believe they will face in FY23?

Respondents were asked to identify the biggest challenges they may face in FY23. Nine in 10 (90 per cent) respondents reported that they expect their business to face challenges, with just 10 per cent stating they would not experience any challenges through FY23.

Forty-two (42) per cent of respondents indicated that fast-rising inflation would be their biggest challenge, while reduced consumer or client spending due to inflation and RBA rate rises were a top concern for 41 per cent. Other challenges SME owners expect to face in FY23 included fast-rising interest rates (chosen by 28 per cent of respondents); having to pay higher wages on the back of the minimum wage increase and employee wage expectations (chosen by 22 per cent); the inability to fill roles in the business due to candidate shortages (19 per cent); and accessing financing or servicing loans and other debts (11 per cent).

Small Business Loans Australia
Small Business Loans Australia
What do you think will be your business's
biggest challenges in FY23?
Response
Businesses by State (%)
NSW VIC QLD SA WA
Fast-rising inflation 38 47 37 43 38
Fast-rising interest rates 33 26 24 37 13
Reduced consumer/client spending due to inflation and rate rises 42 38 33 47 69
Unable to fill roles in the business, due to candidate shortages 24 18 15 10 25
Having to pay higher wages on the back of the minimum wage increase and employee/candidate wage expectations 24 17 20 23 38
Accesing financing and/or servicing loans and other debts 11 9 11 17 13
My business will have challenges, but they are not listed above 9 18 19 13 13
My business will not have any challenges in FY23 8 12 15 7 0
What do you think will be your business's
biggest challenges in FY23?
Response
Businesses by State (%)
Micro Small Medium
Fast-rising inflation 40 41 42
Fast-rising interest rates 23 37 28
Reduced consumer/client spending due to inflation and rate rises 45 35 41
Unable to fill roles in the business, due to candidate shortages 12 35 19
Having to pay higher wages on the back of the minimum wage increase and employee/candidate wage expectations 13 35 22
Accesing financing and/or servicing loans and other debts 9 13 11
My business will have challenges, but they are not listed above 19 9 15
My business will not have any challenges in FY23 12 9 10
Will you do any of the following in FY23 to get through the
challenging period, if things get tough?
Small Business Loans Australia
Will you do any of the following in FY23 to get
through a challenging period, if things get tough?
Response
Businesses by State (%)
NSW VIC QLD SA WA
Let go of some employees 13 13 11 0 19
Cut costs such as switching to cheaper suppliers and cutting discretional business spending 31 33 54 54 31
As a business owner, I will pay myself less 39 38 35 46 50
Postpone any planned investment in the business (such as equipment, new hires, technologies) 46 39 46 21 38
Refinance or look to pay off business debts faster 13 8 13 4 13
Get financing to help the business through tough times 12 5 9 7 13
None of the above 15 17 11 18 19