Australian small businesses optimistic about online sales growth in 2023

Laura Hill, Managing Director of Sendle Australia

Amid a gloomy economic outlook, 80% of Australian small businesses are forecasting online sales growth in the next 12 months, according to Sendle’s 2022 Small Business Survey. The annual survey from Australia’s first 100% carbon neutral parcel delivery service, Sendle, surveyed over 900 SMBs in Australia on their expectations and sentiments for 2023.

What were the findings of Sendle’s survey?

The survey reveals that majority of small businesses (SMBs) are optimistic about sales growth in 2023, with 37% of SMBs forecasting a 25-75% growth in online orders over the next 12 months. SMBs in the Automotive & Marine industry predict the strongest growth in 2023, with 38% of SMBs forecasting over 75% growth in online orders over the next year.

This was closely followed by SMBs in the Office Furniture & Supplies and Food & Beverage industries who forecasted over 75% growth in online orders, at 33% and 32% respectively. 

Cost of living pressures the top challenge for small businesses 

However SMBs acknowledge that next year is set to be a much harder grind. Cost of living pressures and rising inflation is clouding the horizon, with 51% of SMBs reporting that the rising costs of products and services is their top challenge when it comes to online sales growth. This compares to 22% who cited finding customers as their top business challenge. 

Despite high and potentially sustained inflation and a global economic slowdown forecasted for 2023, SMBs are rising to the challenge. Over half (51%) said they feel satisfied about the support available, which could include govt assistance for small-to-medium businesses.  

Sustainability top of mind, but knowledge gaps stalls progress 

Sustainability is a critical business practice that is here to stay, with 55% of respondents selling locally made products. Over a third (34%) their products are ethically or sustainably sourced. SMBs in the Food & Beverage industry are leading the way, with one in two (51%) reporting that between 75-100% of their products are ethically or sustainably sourced.

This is closely followed by small businesses in Jewellery & Accessories and Baby & Children sectors, at 48% and 45% respectively. Sustainability is helping small businesses capture a growing audience that cares about the environment, with 34% of respondents reporting that demand for locally produced products has increased over the past 12 months.

More companies are realising the benefits for their companies and the environment, with 34% reporting that they have implemented sustainable business practices and products. Despite the growing interest in sustainability, awareness and knowledge gaps still exist.

Around a third (32%) admit that they don’t know whether their products sold are ethically or sustainably sourced. Many struggle to overcome barriers to implementing sustainable practices, with 32% saying they’ve not made changes to their business model or products.

When comparing SMBs across industries on where they are at in their sustainability journey, SMBs in Toys, Hobbies & Games, Automotive & Marine and Clothing & Footwear are more likely to report that they have not made changes to their business model and products. 

What were Sendle’s thoughts on the findings?

Commenting on the survey findings, Laura Hill, Managing Director of Sendle Australia, said, “Sendle’s 2022 Small Business survey tells us that it’s not all doom and gloom for small businesses. The recent Black Friday and Cyber Monday sales may explain this confidence, with our parcel volumes up 50% during the November sales period. Many small businesses continue to see an uptick in online sales growth, as consumer spending remains resilient.” 

“Growth is a top priority for SMBs, of course, but what matters is that growth is smart and sustainable. SMBs increasingly recognise that sustainable products and practices are not only good for the planet, but also for the bottom line. However, Sendle’s survey reveals that more educational resources are needed for SMBs to make the transition easier and quicker.”