As we begin to enter the wake of COVID-19, many Australian SME (Small and Medium Enterprises) have suffered from the economic impacts of the sudden global pandemic. This has left many to rethink their product and services delivery strategies, which lead to the drastic reduction of costs just to survive during this time.
During the pandemic, the Australian Bureau of Statistics (ABS) released a Business Impacts of COVID-19 survey last year. The survey revealed that two thirds of businesses experienced a reduction of turnover or cash flow, and 64 % reported a reduction in their product and service demands.
Due to these findings, the government released the Job Keeper Payment scheme, a subsidy supporting businesses and their employees who were significantly affected by the coronavirus. This support remains open to new and existing participants who meet eligibility requirements until the end of this month, where job keeper rates will continue at either $1,000 per fortnight or $650 per fortnight (before tax), depending on the number of hours.
Despite Job Keeper benefits, the latest report released by the ABS discloses 41% of businesses were impacted by COVID-19 restrictions this February, with the second most common factor significantly impacting businesses last month being reduced cash flow (30%), halving since April 2020 (72%).
As a result of these continued impacts, it has been found that one in seven businesses (14%) sought additional funds over the past three months. 61% of small and 80% of medium businesses were successful in obtaining funds, while only 18% of small and 6% of medium businesses remained unsuccessful.
Despite the struggles Australian businesses have been facing, government support remains an effective solution in helping the SME sector to rise back and stand on their feet.
