SME conditions weaken
Small to medium sized business (SME) conditions have weakened in the June quarter, with only 27 per cent of SME’s reporting good or very good conditions, down from 32 per cent in the March quarter.
The research was provided by the National Australia Bank (NAB) SME survey for June. Geoff Greer, NAB’s regional general manager of business banking Australia, said a weakening level of consumer confidence and concern about the rate of economic growth was affecting all SME’s.
Small SME’s reported business conditions at 0 index points, the worst affected. Mid sized SME’s were at 9 index points, while large sized SME’s were the most positive, with business conditions at 11 index points.
Profit growth was slowing, matching the deteriorating business conditions. The NAB SME profit index dropped to 4 index points from 11 and the 12-month profit outlook was revised from 12 index points to 8.
However, Greer said that some areas of the economy were doing well.
“There are sectors of the economy that are bucking the trend. SME’s operating in the health, finance and insurance markets reported the strongest conditions in the June quarter,” he said.
“Despite the challenges currently facing SME’s, we must take encouragement from the fact their profit outlook remains positive for the year ahead,” Greer said.
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