PRESS RELEASE: SMEs Enter Holiday Season with Growth Ambitions Amid Economic Headwinds: Fifth Quadrant Business Sentiment Tracker Wave 57 – November 2023

SMEs Enter Holiday Season with Growth Ambitions Amid Economic Headwinds

• 30% are generating more revenue than 12 months ago, but 37% note a decline in YoY revenues
• 85% are concerned about rising interest rates
• 38% are focusing on growth, the most since October 2022
• Satisfaction with the federal government has dropped to 25%

6th December 2023:
The November findings indicate that in the face of escalating business challenges, a significant
number of small and medium-sized enterprises (SMEs) are shifting their focus towards growth. A
record 38% of SMEs have plans to prioritise growth in the coming 12 months, the highest
percentage observed this year.

Concurrently, the proportion of SMEs anticipating a rise in capital expenditure has also reached a
peak, with one-third (31%) expecting to increase their investments, marking a notable high point
in investment intentions.
This increased appetite for growth comes amidst the ongoing concerns regarding wage (70%),
fuel (84%) and energy (82%) costs, as well as the possibility of future interest rate rises (85%).
The SME Sentiment Tracker is conducted by leading business market research firm Fifth
Quadrant in partnership with Ovation and tracks business sentiment across more than 400 small
and medium enterprises each month.

Even with escalating worries about rising costs and a cautious stance regarding both global and
local economic conditions, short-term revenue forecasts among businesses have remained
consistent. For the third month in a row, 29% of businesses anticipate a revenue increase in the
upcoming four weeks.

This stability in revenue expectations is likely influenced by heightened marketing efforts,
particularly in preparation for the Christmas season, as evidenced by 25% of businesses
increasing their marketing investments during this period.

Satisfaction with the federal Labor government has seen a notable decline, dropping from 33% in
October to 25% in November. This significant decrease in approval is likely a reaction to the latest
interest rate hike and ongoing increases in operating costs.

Fifth Quadrant, Managing Director, James Organ said: “In summary, higher growth intentions and
steady short-term revenue expectations provide cause for positivity heading into the Christmas
period. While the potential for further rate rises in 2024, coupled with higher input costs, are
causing much anxiety for SMEs, recession readiness and the ability to pass on higher input costs
remain steady. Thus, many SMEs will enter the Christmas period optimistic, and hopeful of easing
inflationary and cost pressures in the new year”.

ENDS

For further information contact:
James Organ
Managing Director
Fifth Quadrant
E: [email protected]
M: 0414 552 240

About the SME Sentiment Tracker
• Based on responses from ~400 SMEs with up to 500 employees across all sectors in
Australia, including metro and regional locations.
• This wave includes data collected from the 13
th – 29th of November 2023.
• Each respondent is a financial decision maker/ influencer in their business.
• Data is weighted by state, industry, and number of employees to reflect the national
distribution of businesses across the country.

About Fifth Quadrant
Too often, we see businesses confusing data with insights, but data alone is not enough. We provide
organisations with insight about their markets and customers by layering context and expertise on top
of data. This allows our clients to make better decisions and unlock tomorrow’s opportunities today.