We have updated our rolling SME survey, ahead of the next edition of the SME report, out soon. The previous version is still available on request. SME’s are under significant cash flow pressure. Today we walk though some of our findings.
We look at businesses up to $5m turnover, although most of the 2 million plus businesses are much smaller.
The average age of the owner is more likely to be 45-55 years, as often they have moved on to second careers, or decided to set up on their own.
Nearly half are less than 4 years old, and indeed more than half started are likely to fail in the first 3 years.
Construction and Real Estate services make up a large proportion of the total, and the SME sector overall is heavily relent on the property sector more broadly.
Around 60% of businesses are seeking to borrow, and most are looking for working capital support.
The main driver within working capital is delayed payments (especially from large private sector companies and some government agencies).
The average debtor days is more than 50 days and rising. It varies by state.
Our risk analysis metric shows that businesses in the other services and construction sectors are most risky when it comes to finance. Health care businesses are the lowest risk.
Next time we will look further at SME finances and their channel usage.