About the study
Money commissioned a survey of an independent panel of 258 Australian business owners. It sought to understand the profits Australian businesses made this year, compared with last year, and whether they tried to increase it. The survey also revealed what business expenses were cut this year – if any.
Money surveyed business owners across a range of organisational sizes: micro-businesses (1-10 employees), SMEs (11-50 employees), medium (51-200 employees) and large (more than 200 employees). Respondents also represented various lengths of time their businesses have been operational: young businesses (less than five years in operation) and established (more than five years).
What did business profits look like this year, compared with 2019?
50% of Australian businesses experienced a decline in profit, when compared to the same time last year. 35% of business owners made about the same profit as in 2019, while 15% made more profit.
Across the states, a higher proportion of businesses based in WA experienced a decline in profits, at 67%, followed by 62% of those in Victoria. In comparison, 40% of Queensland businesses made less profit.
What proportion of Australian business owners made cuts to expenses this year?
The survey reveals that 55% of Australian business owners made cuts to expenses this year.
A higher proportion of businesses based in NSW made cuts to expenses, at 65%, compared with 59% of Victorian businesses and 33% of those based in WA.
What business expenses were cut this year?
Among the 55% of business owners who made cuts to expenses, 45% made cuts across travel. A high proportion of business owners also made cuts to employees and contractors, at 44%, and 34% cut lunches and entertainment.
Across the States, 52% of business owners in NSW made cuts to employees and contractors, compared with 43% of those based in Victoria and 17% in South Australia.
An equal 24% of business owners overall also made cuts to their own salary and froze pay increases and bonuses. 20% cut back on marketing expenses, 17% cut rent and work vehicle expenses, while 15% made cuts on business gifts, external consultants and switched to cheaper suppliers, technologies, and subscriptions. 13% cut back on charitable donations and 11% on workplace amenities.
Across organisation sizes, owners of micro-businesses were more likely to pay themselves less this year, with 32% of respondents citing this, followed by 31% of small business owners. In comparison, 25% of medium-sized business owners and 3% of large business owners paid themselves less.
Did business owners try to increase their income this year?
57% of business owners did not try to increase their business income this year.
Across the states, 77% of South Australian businesses did not try to increase income, compared with 61% of Queensland businesses and 52% of those based in NSW.
Younger businesses were less likely to try to increase income this year, with 56% of those in operation less than five years citing this, compared with 45% of established businesses (those that have operated more than five years).
