thinkbig 2015

Insights into the challenges and opportunities facing Australian SMEs

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thinkBIG 2015 is our 10th research study that measures the pulse of the Australian SME sector.

•Identify the impact of financial conditions on business sentiment

•Assess the impact of current issues on the economy

•Report on business outlook over the next 12 months

•Benchmark critical areas such as business planning, exit planning and superannuation

Business Growth and Profitability


1. Be prepared to evolve and embrace new business practices in order to achieve the kind of growth that contributes to profits.

2. Prepare a business plan. Businesses with a strong business plan are more likely to grow.

3. You can’t cut your way to growth. Once you have reduced your costs to ensure a lean organisation, you need to focus on the sales that are most likely to produce results.

4. Understand what your customers want and be prepared to deliver this.

5. Use low-cost technology to improve internal efficiencies and support sales growth.

6. Keep on top of your cash flow. Create a cash flow forecast, give customers options for paying their bills, send out invoices promptly and monitor stock closely.

6 suggestions for business growth & profitability

Business Planning


6 key ingredients for a good business plan1. Executive summary > Include a company background, marketing opportunity, mission

statement, competitive advantage and a summary of financial projections. It is a good idea to write the executive summary last despite it being the first section of your business plan.

2. Company overview > Provide more information about the company, including when and how it was formed, its business model and its strategy and direction.

3. Business offering > Outline why the company is in business, its competitive advantage and also what products or services it sells. The business offering should also provide information on manufacturers, distributors and inventory. Include any new product or service planned to be introduced in the future.

4. Marketing plan and analysis > Detail the marketing and sales plan, customer service, advertising and public relations. Many companies use this section to outline why the company will be successful and back this statement up with market-based research.

5. Strategy and implementation > Provide strategy and implementation, as this is important for potential investors. It includes all the in-depth details including dates and deadlines. It can also include the company’s sales forecasts.

6. Financial projection > Include projected profit and loss statements, balance sheet and cash flow statements. Financial projections are about showing the quantities involved in the entire business plan.

Exit Planning


6 tips for successfully exiting your business

1. Have a plan. Exiting the business is inevitable so align your business strategies around the exit plan to keep the business on track and minimise risk.

2. Make your business attractive to buyers. Improve margins, ensure costs are minimised and benchmark yourself against industry standards.

3. Consider the market environment. With many baby boomers seeking to exit businesses in the coming years, the market may be more competitive than you expect.

4. Be aware of the tax implications of selling your business and plan early to minimise this.

5. Ensure you have a current valuation of your business. If you are relying on this to fund your retirement, you don’t want any nasty surprises.

6. Communicate plans early. Make sure you have the right people involved at the right time to ensure a smooth transition, regardless of how you plan to exit the business.

Superannuation Planning


6 ways to maximise your superannuation

1. Superannuation is a long-term strategy. You are never too young to begin planning for retirement and contributing to your super.

2. Consider setting up a self-managed superannuation fund to exert more control over investment decisions for yourself, your family and your business.

3. Seek professional advice on ways to maximise retirement funds in super.

4. Consider using an SMSF to purchase property for your business, potentially gaining a more valuable asset in the long term.

5. Keep the end game in mind. At some point, you will need to start drawing on your superannuation fund.

6. The current debate around the adequacy of retirement incomes will only increase as the population ages. Be aware of your own retirement plans and keep a close eye on proposed changes so that you can assess the impact on your personal and business arrangements.

Future Trends


Digital disruption primary enablers


6 steps to leveraging digital transformation1. Prepare a strategy > The digital world is new, so it’s easy to be led astray. Having a

digital strategy in place will keep you on track. This should include online activity, social media and marketing. Your digital strategy needs to be closely aligned to the overall business strategy.

2. Get started > It’s highly likely your competition is moving into the digital world, so don’t get left behind. Start with smaller projects and then move to bigger ones as you get more digitally-savvy.

3. Set a budget > You can spend as little or as much as you want on activities like social media and creating a digital presence. Set a budget so you know in advance how much you want to spend according to what fits in with the overall business plan.

4. Prepare to fail > If you’re new to the digital world, you’re going to make mistakes. Be prepared to assess your digital goals regularly and to change tactics as required.

5. Analyse the data > One advantage of today’s digital world is the richness and volume of data available. Be prepared to review and analyse the data you gather, so you can optimise business decisions and deliver better customer service.

6. Review the strategy > You now have a wealth of data to assess the effectiveness of your original strategy. Use these learnings to focus your strategy on the projects and activities that generate the most positive outcomes.


• Respondents completed a survey via email or phone in February and March 2015

• The sample consisted of 446 respondents

• Most participants (70%) were from capital cities

• Most respondents (66%) are in the 45-64 age groups, which is consistent with 2013 and 2014

• Majority of the businesses represented (70%) are more than 10 years old, which is consistent with 2012, 2013 and 2014

• The majority of respondents (80%) were male, in line with 2013 and 2014 results

Demographics & methodology

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thinkbig 2015

Business

presentation subject

business planning

business sentiment

business outlook

business model

good business plan

strong business plan

business growth profitability