A robust 56% of Australian SMEs are forecasting positive enterprise revenue over the next six months – the strongest growth outlook for the sector since March 2016.

However, at the opposite end of the scale, 31% of SMEs predicted their revenue will contract in the next six months, on average by 8.5% – both record figures in the decade long history of Scotpac’s SME Growth Index.

The findings are contained in the latest round (Q1, 2023) of the bi-annual SME Growth Index by ScotPac, Australia’s leading non-bank business lender.

ScotPac CEO, Jon Sutton, said the large discrepancies in revenue projections are a clear sign of the two-speed SME economy operating in Australia today. He said next week’s Federal Budget would be critical to SME confidence in the next 12 months.

‘This is by far the largest spread of revenue growth projections we have ever seen in the SME Growth Index, which is consistent with surging rates of insolvency in the past quarter,’ Mr Sutton said.

‘The fact that more than half of the country’s SME owners are predicting revenue growth is both remarkable and encouraging when you consider they continue to deal with the rising cost of doing business, particularly in key areas like wages, energy and interest rates.

‘But there is no doubt that tough economic conditions and the end of government-backed pandemic relief measures in the past 12 months is taking a huge toll on cashflow dependent businesses in many parts of the sector.

‘The Albanese Government has publicly stated that SMEs will be ‘front and centre of the May Budget’. It is critical for the confidence of SME owners and operators that the Budget delivers some material support to address the increasing cost and compliance pressures they are facing,’ Mr Sutton said.

Other related insights from the SME Growth Index Report include:

  • The average projected growth rate of SMEs forecasting positive enterprise revenue over the next six months was 8%, the most upbeat outlook in almost a decade.
  • Six-month revenue forecasts for SMEs ranged from -20% to +12.5%, a record spread for the SME Growth Index.
  • The average revenue growth projection across all SMEs was +2%.

Scotpac is Australia and New Zealand’s largest non-bank business lender, providing funding to small, medium and large businesses from start-ups to enterprises exceeding $1 billion revenues.

Mr Sutton encouraged all SME owners to engage regularly with their brokers and key advisors to assess their business options.

‘The unfortunate fact is a lot of SME owners are not aware of the range of financial support options available to make running their business easier,’ Mr Sutton said.

‘In some cases a timely discussion with a broker or advisor could mean the difference between continuing to trade or closing the doors prematurely. ‘ScotPac understands that working capital is the lifeblood of SMEs, and we have the broadest range of products to suit businesses at every stage of their growth,’ Mr Sutton said.

About the SME Growth Index

ScotPac’s bi-annual SME Growth Index, is Australia’s longest running research report on SME sentiment towards revenue growth prospects.

The Round 18 research was conducted by East & Partners who interviewed 720 SME enterprises with annual revenues of A$1-20 million in February 2023.

SMEs surveyed have operated continuously for 14.2 years and manage an average of 59 full time employees.

Sectors represented in the survey included Manufacturing (14%), Property & Business Services (14%), Retail (11%), Wholesale (11%), Personal / Other Services (10%), Construction (10%) and other industries including Transport & Storage, Mining, Agriculture, Media, Hospitality, Finance & Insurance (non-bank) and Electricity.

ScotPac is Australia and New Zealand’s largest non-bank SME business lender, providing funding to

small, medium and large businesses from start-ups to enterprises exceeding $1 billion revenues. For

35 years ScotPac has helped thousands of business owners succeed, offering fast and flexible funding. From simple to complex, small to large, start up, growth or turnaround – ScotPac can help

with a range of funding from Invoice, Trade or Asset Finance to Home Loans and Business Loans.


For more information contact:

Todd Hayward

Mob: 0412 205 151