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Some sunshine for QLD businesses but cloud still looms

June 30, 2011

Trading conditions improved for Queensland small businesses during the quarter, according to the Sensis® Business Index released today, but many are still worried about their long-term prospects.

 Report author Ms Christena Singh said sales and profitability improved in Queensland during the quarter, although they remain negative and below the national average.

 “Queensland small businesses expect sales and profitability to improve further this quarter, but many are still worried about their prospects for the next 12 months.

 “The business confidence indicator slipped further during the quarter in Queensland, but not by the same degree we have seen in many other states and territories. And certainly nothing like the strong slide we saw after the spate of natural disasters.

 “Nevertheless, business confidence in Queensland remains below the national average,” Ms Singh said.

 People not spending and a negative impact from the Federal Budget were the key reasons Queensland small businesses said they were worried about their business prospects.

 Given the topical nature of a proposed carbon tax in Australia, the Sensis® Business Index also asked Queensland small businesses specifically about their views.

 Thirty-two per cent of Queensland businesses said they did not understand the proposed carbon tax, while 57 per cent said they partially understood. Eleven per cent said they had a thorough understanding.

 Fifty-three per cent of Queensland small businesses said a carbon tax would have a negative impact on their business, while 42 per cent believe it would have no impact. Five per cent believe it would have a positive impact.

 According to the findings, Queensland small businesses are most concerned about a carbon tax impacting on costs, with lower consumer demand and increased regulation also key reasons.

 For those Queensland businesses that felt the carbon tax would have a negative impact on their business, seven per cent said they would consider modifying products and services, while five cent said they would consider closing or selling their business, and three per cent would look at decreasing staff.

 After rallying the previous quarter, the Sensis® Business Index shows a decline in small business support for the Queensland Government.

 Key Queensland findings from the June 2011 Sensis® Business Index:

·         Business confidence fell from 28 to 24 per cent (28 per cent nationally)

·         Profitability improved from negative 39 per cent to negative 29 per cent (negative14 per cent nationally)

·         The sales indicator rose, up from negative 35 per cent to negative 20 per cent (negative14 per cent nationally)

·         Overall employment by Queensland small businesses fell during the quarter, taking the indicator from a flat result of zero to negative one per cent (one per cent nationally)

·         Support for the Queensland Government slipped five percentage points, taking the indicator to negative 33 per cent.