Australian startups are more confident of their revenue growth compared to 2013, according to a survey conducted by accounting software provider MYOB.
The latest MYOB Business Monitor revealed 62% of startups experienced rising or steady revenue in the 12 months to February 2014; 21% of startups reported an increase in revenue; 28% reported a revenue decline; and 41% reported steady revenue. In August 2013, these figures were 24%, 34% and 29% respectively.
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According to the survey, confidence in revenue growth has also increased with 38% of start-ups expecting revenue to rise in the 12 months to February 2015, up on 34%; 17% expect revenue to decline, a significant drop from 22%; and 36% expect revenue to remain steady, slightly more than 35% in August 2013.
MYOB general manager, business division, James Scollay says the enthusiasm and confidence of startups is something to emulate regardless of the age, size or type of business.
The positivity of start-ups is underscored by a strong start to the year with 37% reporting more work or sales in the pipeline for the three months from February to April 2014. This compared to the previous survey where 31% said they had more work or sales in the pipeline for the months of August to October 2013.
When it comes to business pressures, fuel prices were the top pain point. Attracting new customers was ranked second.
Startups also planned on increasing investment in business strategies over the next 12 months.
“There is a strong correlation between the pain points affecting startups and the investment strategies they intend to focus on, “says Scollay. “For example, increasing focus on customer acquisition and retention strategies can help alleviate the pressure of attracting new customers.”
Top five business pressures for start-ups in 2014:
1. Fuel prices – 34% (35% all SMEs)
2. Attracting new customers – 32% (26% all SMEs)
3. Cash flow – 31% (27% all SMEs)
4. Competitive activity – 28% (26% all SMEs)
5. Price margins and profitability – 26% (25% all SMEs)
Top five areas of increased investment for start-ups in 2014:
1. Customer retention strategies – 42% (30% all SMEs)
2. Number or variety of products/services offered – 35% (26% all SMEs)
3. Sale of products/services online – 29% (22% all SMEs)
4. The value of spending on marketing and advertising offline – 29% (18% all SMEs)
5. Customer acquisition strategies – 28% (26% all SMEs)