SMALL businesses are remaining confident in the ability to push through the impending increase of operating expenses, according to the Small Business Development Corporation’s latest Ready Response Network poll.
Ninety-five per cent of small businesses surveyed are expecting operating expenses to increase over the next 12 months, but more than 60 per cent say they are confident their businesses will continue to do well.
The SBDC poll found 86 per cent of small businesses anticipate an increase of up to 20 per cent in their operating costs over the next 12 months.
A further 3 per cent of businesses surveyed are expecting an increase of more than 50 per cent on current levels in the current financial year.
Businesses remain confident, though, with more than 50 per cent of all respondents expecting their business activity to increase during the same period.
Sixty-two per cent believe their net profit will increase or stay the same over this period.
SBDC acting managing director Jacky Finlayson said increasing costs of operating expenses such as rent, wages, utility charges and interest rates had always been a key concern to small business operators.
“It is encouraging to see that most small businesses have strategies in mind to cope with increased operating expenses,” she said.
According to the poll, there are three key strategies that small businesses are most likely to use to counter increased operating expenses.
Thirty-two per cent of respondents said they would increase the number of sales; 27 per cent said they would increase the price of goods or services; and 21 per cent said they would reduce operating expenses such as consumption or staff hours.
According to Ms Finlayson, 15 per cent of respondents believe they have no option but to absorb the increased operating expenses.
