Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Innovation the linchpin to drive SME sales growth

MEDIA RELEASE

Research indicates innovation the linchpin to drive SME sales growth

Sydney, Australia, 1 September 2014: Australian small to medium enterprises (SMEs) are increasingly investing in innovation in a bid to improve productivity in a low growth environment.

According to the latest July 2014 Bibby Financial Services Barometer, more than half of SMEs surveyed (53.1%) are focused on undertaking innovation in the short to medium term, primarily to focus on future growth.

Almost one third of SMEs are committed to innovate in the next 12 months, while a further 21% intend to innovate over the medium term (after 12 months). Over 70% of SMEs say that innovation is important to compete with larger business.

Technological innovation is the main priority for medium sized business, with 67.4% of respondents citing this as a high priority. For small businesses, with between 5 and 19 employees, product innovation is a top priority (53.3%) and for micro businesses, with less than 5 employees, customer acquisition innovation is a top priority (51.5%).

The key benefits of innovation identified by SMEs include future growth; improving productivity; generating higher quality products and services; increased customer satisfaction and having more efficient work processes.

Mark Cleaver, Managing Director for Bibby Financial Services - Australia and New Zealand, said, “Our latest survey revealed that SME sentiment has fallen considerably since February and as a result, SMEs are investing more in innovation to improve sales growth.

"Investing in innovation, such as technology and customer acquisition strategies, can help equalise the playing field between big and small business. Whether this involves spending more on social media to better engage with customers or product innovation to help attract new business, innovation is crucial for ensuring future growth," he said.

Funding to innovate
To help fund innovation, one in five SMEs (21.2%) intend to seek external financing over the next 12 months and the majority (58.4%) plan to fund their innovation internally, presumably through earnings or cash reserves.

Of those who intend to use external finance, the survey found 30% of SMEs will consider a traditional bank loan and 25% will apply for bank overdrafts. As many as 22% plan to sacrifice business profits or undertake inter-company loans and 10% plan to access debtor financing.

Most respondents (69.9%) expect to receive a return from their business' innovation investment within one year of the initial investment and 30% expect to see some benefit within six or 12 months.

"Debtor finance is the ideal funding solution for innovation as it offers a flexible line of credit linked to business' credit. As a company's sales ledger grows, so too does the ability to access cash through debtor finance. Debtor finance helps to release the cash flow locked up in outstanding invoices quickly instead of needing to wait several months to convert invoices to cash flow and doesn't require property as security," Mr Cleaver said.

The survey revealed businesses in Western Australian and Queensland are the most committed to undertaking innovation over the next 12 months, focused mainly on product and technological innovation.

About the Bibby Barometer Survey and Cash Flow Index
The July 2014 Bibby Barometer Survey surveyed over 800 small and medium sized business owners with between one to 199 employees throughout Australia. The Bibby Barometer survey is conducted bi-annually by CoreData to gauge the temperature of Australian SME business sentiment on economic conditions, cash flow, financing and key business challenges. The Bibby Cash Flow Index is a composite measure of current cash flow experiences, along with forward cash flow projections to provide a snapshot of how cash flow is perceived by Australian SMEs.

About Bibby Financial Services
Bibby Financial Services is one of the world’s leading global debtor finance specialists (also known as invoice finance, factoring and invoice discounting) - a flexible and accessible cash flow funding tool for small and medium sized businesses. With almost 7,000 clients in 16 countries worldwide, Bibby Financial Services is part of the Bibby Line Group, a family-owned business-to-business services group with origins in shipping dating back over 200 years to 1807.

Debtor finance is designed to improve business cash flow and support business growth through providing a flexible line of credit linked to sales by releasing cash tied up in unpaid invoices. Unlike other funding arrangements, no real estate security is required, making it more accessible for small and medium sized business owners.

Bibby Financial Services Australia has grown dramatically, in recent years at an average 20% pa, due to increasing awareness of debtor finance as a smart choice for improving cash flow, and a commitment to providing flexible, tailored solutions quickly. It now serves clients nationally, via a network of offices in Sydney, Melbourne, Brisbane, Perth and Adelaide, and also has a presence in Auckland, New Zealand.

For more information on Bibby Financial Services, please visit www.bibby.com.au

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: NZ Net Migration Rises To Annual Record In September

New Zealand’s annual net migration rose to a record in September, beating government forecasts, as the inflow was spurred by student arrivals from India and Kiwis returning home from Australia. More>>

ALSO:

Scoop Business: Fletcher To Close Its Christchurch Insulation Plant, Cut 29 Jobs

Fletcher Building, New Zealand’s largest listed company, will close its Christchurch insulation factory, as it consolidates its Tasman Insulations operations in a “highly competitive market”. More>>

ALSO:

Scoop Business: Novartis Adds Nine New Treatments Under Pharmac Deal

Novartis New Zealand, the local unit of the global pharmaceuticals firm, has added nine new treatments in a far-ranging agreement with government drug buying agency, Pharmac. More>>

ALSO:

Crown Accounts: English Wary On Tax Take, Could Threaten Surplus

Finance Minister Bill English is warning the tax take may come in below forecast in the current financial year, as figures released today confirm it was short by nearly $1 billion in the year to June 30 and English warned of the potential impact of slumping receipts from agricultural exports. More>>

ALSO:

Auckland Outage: Power Mostly Restored Overnight

Vector wishes to advise that all but 324 customers have been restored overnight. These customers are spread throughout the network in small pockets. The main St Johns feeder was restored around midnight allowing most of the customers in all affected areas to have power this morning. More>>

ALSO:

Half Empty: Dairy Prices Drop To Lowest Since August 2009

Dairy product prices fell to the lowest level in more than five years in the latest GlobalDairyTrade auction, led by declines in butter milk powder and whole milk powder. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand

Mosh Social Media
 
More RSS  RSS
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news