What's the outlook for Australian fashion start-ups?
Despite strong business performance, the outlook for revenue growth for Australia’s start-ups in the next 12 months is weaker than in 2013.
This is according to figures from the latest MYOB Business Monitor.
According to the study, 63 per cent of start-ups reported rising or steady revenue in the 12 months to August 2014.
Some 23 per cent recorded a revenue increase, while 27 per cent reported a revenue decline and 40 per cent reported steady revenue.
In August 2013, these figures were 24 per cent, 34 per cent and 29 per cent respectively, showing a material improvement in trading performance year-on-year.
Looking ahead, however, confidence in revenue growth for the year ahead is significantly lower than figures from one year ago.
Only 26 per cent of start-ups expected revenue to rise in the 12 months to August 2015 (down from 38 per cent in the previous corresponding year).
Confidence toward a steady revenue also decreased; only 27 per cent of start-ups expected a steady revenue in the coming 12 months, compared with 35 per cent a year ago.
More work in the pipeline as 2014 draws to a close
Positivity among start-ups for the closing months of this year was strong, with 49% reporting more work or sales in the pipeline for the 3 months from August to October 2014. This is compared with 31% during the previous corresponding period (the 3 months from August to October 2013).
Top three pressures on start-ups
Fuel prices was ranked as the no.1 ‘pain point’ for start-ups, followed by cashflow, attracting new customers, price margins and profitability, and competitive activity.
Among SMEs overall, the top pain point in the latest Business Monitor was fuel prices, followed by attracting new customers, cashflow, price margins and profitability, and the timing of customer payments.
Despite cashflow being one of the top 3 pain points for start-ups, 59% of start-ups intended to keep their investment in a business advisor at the same levels and that 24 per cent are planning to increase their investment in working with a business advisor.
Top 5 business pressures for start-ups in 2015:
1. Fuel prices – and more than 1 in 3 (36%) were reporting ‘high levels of pressure’
2. Cashflow – and 1 in 3 (33%) were reporting ‘high levels of pressure’
3. Attracting new customers – and in 1 in 3 (33%) were reporting ‘high levels of pressure’
4. Price margins and profitability – and nearly 1 in 4 (24%) were reporting ‘high levels of pressure’
5. Competitive activity and nearly 1 in 5 (21%) were reporting ‘high levels of pressure’
Top 5 areas of increased investment for start-ups in 2014:
1. Customer acquisition strategies
2. Customer retention strategies
3. The dollar value of spending on marketing and advertising their business online
4. The number or variety of products and services
5. The sale of products and services online.
Start-ups embrace cloud technologies
Start-ups continue to lead the way in cloud technology usage.
According to the August 2014 Business Monitor,28% of start-ups use cloud technology, well ahead of businesses 2-5 years old (22%) and well ahead of those businesses under 10 years old (14%).
Start-ups continue to lead the way in online presence
According to the August Business Monitor, 68% of start-ups said their business had an online presence - 30%per cent had a business website, 16% had a social media site, and 17% utilised both.
32% said they did nothave an online presence.
MYOB CEO Tim Reed said online technologies continued to play an important role in start-up businesses.
"Our research has shown us that not only do online businesses reach more customers and are more engagedwith them, they are also making a solid contribution to economic growth and improving job opportunities forAustralians.
"By investing in online technologies from day one, start-ups are in a strong position to capitalise on all thebenefits that online technologies can bring to their business as they strive for growth."