November2007SensisBusinessIndex

8/7/2019 November2007SensisBusinessIndex

http://slidepdf.com/reader/full/november2007sensisbusinessindex 1/32

November 2007

Sensis® Business Index- Small and Medium Enterprises



Sensis® Business Index – Small and Medium Enterprises

Sensis® Business Index - Small and Medium Enterprises November 2007

Introduction .............................................................................................................................................................................. 1

About the survey ...................................................................................................................................................................... 2

Executive summary .................................................................................................................................................................. 3

Small and medium business outlook – national summary ...................................................................................................... 6

Confidence in own business prospects over the next 12 months...........................................................................................6Confidence by state, sector and size.........................................................................................................................................7Perceptions of the economy......................................................................................................................................................8Expectations on key indicators over the next 12 months........................................................................................................9Concerns .................................................. ............................................................ .................................................................. .. 10Sales......................................................................................................................................................................................... 11Employment ........................................................ ............................................................. ....................................................... 12Wages bill................................................................................................................................................................................ 13Prices ....................................................................................................................................................................................... 14Capital expenditure................................................................................................................................................................. 15Profitability.............................................................................................................................................................................. 16Exports ...................................................... ........................................................... .................................................................. .. 17Assessment of Federal Government policies......................................................................................................................... 18Assessment of State Government policies ............................................................................................................................ 19Workplace relations ................................................................................................................................................................ 20Generational differences in the workplace............................................................................................................................ 20

Small and medium business outlook – national .................................................................................................................... 21

Small and medium business outlook – New South Wales..................................................................................................... 22

Small and medium business outlook – Victoria...................................................................................................................... 23

Small and medium business outlook – Queensland................ ........... ........... .......... ........... ........... ........... .......... ........... ......... 24

Small and medium business outlook – South Australia ......................................................................................................... 25

Small and medium business outlook – Western Australia..................................................................................................... 26

Small and medium business outlook – Tasmania .................................................................................................................. 27

Small and medium business outlook – Northern Territory........... ........... ........... ........... .......... ........... ........... ........... .......... .... 28

Small and medium business outlook – Australian Capital Territory.............. ........... ............ ........... ........... .......... ........... ....... 29




November 2007 Page 1

IntroductionThe Sensis® Business Index is an ongoing series of surveys tracking confidence and behaviour of Australia’s small and mediumenterprises (SMEs). These surveys have been undertaken quarterly since 1993.

The primary objectives of the Sensis® Business Index are to:

- track small and medium business activity over the past three months

- track expectations over both the current three and 12 month periods

- measure overall confidence among SMEs.

Another purpose of the Sensis® Business Index is to provide an independent, objective assessment of proprietors’ experiencesand attitudes on key issues.

The Sensis® Business Index is based on a sample size of 1,800 SMEs from metropolitan and regional areas of Australia. Itincludes businesses within the accommodation, construction, communication, health, community services, cultural andrecreational industries.

The Sensis® Business Index enables broad scrutiny of the SME market, as well as an understanding of trends and issuesrelevant to this sector. It examines the differences in attitudes and experiences between regional and metropolitan SMEs andbetween small and medium enterprises. The aim of the Sensis® Business Index is to reflect the attitudes and behaviour ofapproximately 99 per cent of the Australian business sector.

Results in the Sensis® Business Index are reported as a net balance, which represents the total number of positive responsesminus the total number of negative responses. All results are based on the responses of SMEs surveyed.

The Sensis® Business Index is an initiative of Sensis Pty Ltd as part of its commitment to this vital business sector. Sensis isAustralia’s leading information resource and is a wholly owned Telstra subsidiary. Sensis’ popular information services makecomplex lives simpler by helping Australians find, buy and sell. These services include Yellow™ , White Pages®, Trading Post®,CitySearch®, UBD®, Gregory’s®, Whereis® and GoStay®. Sensis provides advertising services to 420,000 Australian

businesses, of which 90 per cent are SMEs.

In addition, the Sensis® Market Inte igence products include commissioned research for corporate and governmentorganisations on a variety of SME, policy and communication issues. For more information on commissioned research, pleaserefer to page 30.

ll



Sensis® Business Index – Small and Med ium Enterprises


About the surveySince its inception in 1993, the Sensis® Business Index has been one of the most extensive and regular surveys of smallbusinesses in Australia. Historically, the Sensis® Business Index has focused specifically on businesses employing 19 people orfewer. In November 2000 it was expanded to cover the medium business sector, while the regional and industrial sectors werealso enhanced.

The November 2007 Sensis® Business Index results are based on telephone interviews conducted with 1,800 small andmedium business proprietors. The sample size comprises approximately 1,400 small businesses and 400 medium businesses(the latter defined as businesses employing between 20 and 199 people).

Businesses interviewed for the November 2007 Sensis® Business Index were drawn from all metropolitan and major non-metropolitan regions within Australia. Quotas were set for geographical location and type of business in order to produce thestandard sample structure shown below. Where replacement businesses are recruited, this sample structure is maintained.

At the analysis stage, results were weighted by selected Australian New Zealand Standard Industrial Classification (ANZSIC)divisions within the metropolitan and non-metropolitan region of each state and territory. This ensured the sample reflectedthe actual small and medium business population distribution. The Australian Bureau of Statistics (ABS) Business Register, as atJune 1998, was used to weight the sample to be representative of the total business population.

Interviewing for this latest survey was conducted from 23 October to 20 November 2007. The report covers experiences overthe past three months (August to October 2007), and expectations for both the current quarter (November 2007 to January2008) and the 12 months ending November 2008.

43513651800Total

-150150Australian Capital Territory

6090150Northern Territory

6090150Tasmania

30195225Western Australia

30195225South Australia135165300Queensland

60240300Victoria

60240300New South Wales

Non-metroMetroTotal

43513651800Total

-150150Australian Capital Territory

6090150Northern Territory

6090150Tasmania

30195225Western Australia

30195225South Australia135165300Queensland

60240300Victoria

60240300New South Wales

Non-metroMetroTotal

Location of business

1800Total

150Cultural, Recreational and Personal Services

150Health and Community Services

300Communication, Property and Business Services

100Finance and Insurance

150Transport/Storage

100Accommodation, Cafes and Restaurants

250Retail Trade

150Wholesale Trade

250Building/Construction

200Manufacturing

1800Total

150Cultural, Recreational and Personal Services

150Health and Community Services

300Communication, Property and Business Services

100Finance and Insurance

150Transport/Storage

100Accommodation, Cafes and Restaurants

250Retail Trade

150Wholesale Trade

250Building/Construction

200Manufacturing

Division





Executive summaryBusiness confidence among SMEs fell dramatically during the past quarter. However, despite lower levels of confidence, currentperceptions of the economy showed significant improvement, but perceptions about the future economic direction fell. Theprime problem reported by SMEs was difficulty finding and keeping staff, followed by a lack of work or sales. Approximatelyone in three SMEs reported that they currently faced no problems at all. SMEs also reported falls in performance across most

indicators, with declines also expected in most areas for the coming quarter and year ahead. The only rises recorded inindicators in the past quarter were a marginal increase in wages performance and a marginal increase in prices for the mediumterm. The falls recorded in the past quarter brought many indicators back to levels last seen around August 2006.

Support for the Federal Government increased strongly to its highest level since May 1996 on the back of strong support fromSMEs for its workplace relations changes. The Federal Government remained the most supported government by SMEs inAustralia. The Northern Territory Government was the most supported state or territory government by SMEs, with New SouthWales again the least supported.

Other key findings from the Sensis® Business Index included in the executive summary are:

1. historical trends and highlights of recent trends for SMEs generally

2. small versus medium business trends

3. metropolitan versus regional business trends

4. industry sector comparisons

5. business cycle analysis based on the findings from this Sensis® Business Index .

Historical trends and overall SME highlights

- Business confidence among SMEs fell sharply during the past quarter.

- Perceptions of the current state of the Australian economy improved considerably, however more SMEs on balance felt thatthe economy would be worse a year from now.

- Most performance indicators fell in the last quarter, with only wages rising marginally.

- In the short term, SMEs are expecting decreases across all indicators.

- Expectations for most key business indicators for the year ahead fell, with the only indicator to record a rise being pricescharged, which rose marginally.

- Problems finding and keeping staff were the primary concern of SMEs this quarter. This was followed by concerns about alack of work or sales.

- Approximately one in three (33 per cent) of SMEs reported currently facing no problems in their business.

- Sales performance returned to the level recorded at the same time last year, reversing the rises recorded in the past year,with decreased expectations for the coming quarter and year.

- Profitability performance was relatively unchanged, maintaining a high level, however expectations for the coming quarterand year fell significantly.

- Employment recorded no net growth during the quarter, with falls expected by SMEs in both the coming quarter and year.

- The proportion of SMEs that increased capital expenditure fell during the last quarter, returning to net negative territoryafter strong performance last quarter.

- Support for the Federal Government’s policies increased strongly on the back of SME support for their workplace relations

policies. The Federal Government was the most supported of any government in Australia by SMEs.

- The Northern Territory Government was the most supported state government in Australia. The New South WalesGovernment recorded the lowest level of support for a state or territory government for the successive quarter.





Small versus medium enterprises

The main differences to emerge between small and medium businesses during the past quarter included:

- Medium businesses were again more confident than small businesses; with the gap increasing from five to fourteenpercentage points.

- Medium businesses were again more positive about the current state of the Australian economy than small businesses,however both small and medium businesses more likely to report that the economy was growing than they had been lastquarter.

- Medium businesses recorded higher performance than small businesses for all indicators in the past quarter.

- Medium businesses continued to be far more supportive of the Federal Government’s policies than small businesses.

Metropolitan versus regional

The key differences to emerge between metropolitan and regional businesses during the past quarter included:

- Regional businesses were more confident than their metropolitan counterparts for the first time since February 2006, with

being established and experienced, cited as the key reason for regional confidence.

- Regional businesses were significantly more positive, on balance, about the current state of the Australian economy thanmetropolitan businesses.

- Regional businesses reported higher performance than regional businesses in all performance indicators for the pastquarter, with the exception of profitability.

- Metropolitan businesses reported higher results than regional businesses in profitability.

- Regional businesses reported higher expectations for the coming quarter than metropolitan businesses for all indicators,with the exception of prices, where the results were equal.

- Regional businesses recorded higher support for the Federal Government’s policies than their metropolitan counterparts.

Industry sector trends

Several trends emerged throughout the industry sectors, including:

- Confidence was highest in the finance and insurance sector.

- The retail trade sector recorded the lowest confidence levels of any sector.

- The accommodation, café and restaurant sector recorded the strongest performance in sales and employment over thepast quarter.

- Upward wage pressures were reported by SMEs in the health and community services sector in the past quarter, with thatsector reporting the highest net results in wages.

-

The finance and insurance sector recorded the highest result in profitability in the past quarter.- The strongest performance result for capital expenditure was recorded in the cultural, recreational and personal services

sector; however this sector also recorded the weakest performance in sales and profitability in the past quarter.

- Looking ahead, the transport and storage sector recorded the highest expectations for the coming quarter for profitability,however the sector also recorded the highest expectations for wages.

- Expectations in the building and construction sector were relatively weak, recording the lowest expectations for sales andprofitability for the coming quarter.

- The finance and insurance sector was the most supportive of the Federal Government’s policies, with the transport andstorage sector being the least supportive.





SME business cycle analysis

SMEs

GDP

Time

The Business Cycle and SMEs

SMEs

GDP

Time

The Business Cycle and SMEs

When examining the 12-month trends for a range of key business and economic indicators, it is possible to gauge the likelydirection of the Australian economy. The table below shows an assessment of each indicator’s performance in relation to the state of the economy. Shaded areashighlight the position of each indicator as a result of the findings from this Sensis® Business Index relative to the normalbusiness cycle. Analysis of the key indicators from the November 2007 Sensis® Business Index suggests a weakening economic environment,with many indicators now declining from peak economic conditions. In addition to weaker performance, expectations for keybusiness indicators have also fallen significantly. Whilst SMEs still believe that the Australian economy is in a growth phase,confidence has been strongly impacted by uncertainty in the lead-up to the Federal Election, with SMEs concerned about theprospect of a change in government. These concerns are impacting SMEs views about the directions of the economy in thenext year, and fewer SMEs are now expecting their business to be performing as strongly in the year ahead.

Moderating wages growthHigh wages growthRising wagesLow wages growth

Declining employmentStrong employmentRising employmentFlat employment

Declining profitabilityStrong profitabilityImproving profitabilityWeak profitability

Selling price risesweakeningHigh selling pricesRising selling prices

Low selling pricerises

Investment expectationsweakening but still on the

high side

Optimistically highinvestment expectations

(i.e. low realisation ratios)

Investmentexpectations improvingbut still on the low side

Pessimistically lowinvestment expectations

(i.e. high realisationratio)

Declining investmentsHigh investmentRising investmentLow investment

Declining salesStrong salesImproving salesWeak sales

Declining perceptions ofthe economy

Strong perceptions of theeconomy

Rising perceptions ofthe economy

Poor perceptions of theeconomy

Falling businessconfidence

Strong business confidenceRising confidenceLow business confidence

4. Slow Down3. Peak2. Recovery1. Trough

Moderating wages growthHigh wages growthRising wagesLow wages growth

Declining employmentStrong employmentRising employmentFlat employment

Declining profitabilityStrong profitabilityImproving profitabilityWeak profitability

Selling price risesweakeningHigh selling pricesRising selling prices

Low selling pricerises

Investment expectationsweakening but still on the

high side

Optimistically highinvestment expectations

(i.e. low realisation ratios)

Investmentexpectations improvingbut still on the low side

Pessimistically lowinvestment expectations

(i.e. high realisationratio)

Declining investmentsHigh investmentRising investmentLow investment

Declining salesStrong salesImproving salesWeak sales

Declining perceptions ofthe economy

Strong perceptions of theeconomy

Rising perceptions ofthe economy

Poor perceptions of theeconomy

Falling businessconfidence

Strong business confidenceRising confidenceLow business confidence

4. Slow Down3. Peak2. Recovery1. Trough

Highlighted sections show the indicators relevant to SMEs for the November 2007 Sensis® Business Index.





Small and medium business outlook – national summarySmall and medium business outlook – national summary

Confidence in own business prospects over the next 12 monthsConfidence in own business prospects over the next 12 months

Key findings

Australian SMEs experienced a dramatic decline in businessconfidence during the past quarter. This latest result is thelowest confidence result in the six years, as well as thelargest one-quarter fall recorded since the inception of theSensis® Business Index in 1993.

Concerns about a change of government and electoraluncertainty were the key reasons for falling confidence thisquarter, with approximately one-third of worried SMEoperators citing this as the reason.

Last quarter (May to July 2007)

SMEs recorded a dramatic fall in business confidence with anet balance of 43 per cent. This comprised 63 per cent ofbusinesses that were confident about their prospects for theyear ahead and 20 per cent that were concerned.

Australian SMEs experienced a dramatic decline in businessconfidence during the past quarter. This result follows stablebusiness confidence last quarter and three successivequarters of solid growth in business confidence before that.With a fall of some 16 percentage points in one quarter, thislatest result is the lowest result in confidence in the six years

since November 2001. The decline in confidence is also thelargest one-quarter fall recorded since the inception of theSensis® Business Index in 1993.

The main reason businesses gave for feeling worried abouttheir prospects related to concerns over a possible change ofgovernment at the federal level and electoral uncertainty,cited by approximately one in three SME that were worried.Overall, some 55 per cent of SME operators felt that theyAustralian Labor Party would win government at theupcoming election, compared to 24 per cent that felt theCoalition would win, and 21 per cent that did not know.

By comparison, the next highest issue was competition, citedby 13 per cent of worried SMEs. The main reasonsbusinesses gave for feeling confident were feelingestablished and experienced in their business operations,good customer relations and plenty of work coming up.

There are three key indicators that provide an overallassessment of SME confidence levels:

- business confidence;- current perceptions of the Australian economy; and,- future expectations for the Australian economy.

These latest results show that while business confidence hasfallen, SME views on the economy are strong. Despite this,future expectations for the economy have declined, mainlydue to falls in New South Wales and Victoria.

Overall confidenceNovember 2007

Q. Thinking about the next twelve months, how confident do you feel about your business prospects?

15%19%14%Extremely confident

48%50%48%Fairly confident

18%17%18%Neutral

16%11%16%Fairly worried

4%2%4%Extremely worried

63%69%62%Total confident

20%13%20%Total worried

+43%+56%+42%*Net Balance

TotalSmall andMedium

MediumBusiness(20 - 199

employees)

Small Business(up to 19

employees)

SOURCE: Sensis® Business Index Sweeney Research – November 2007

Confidence trends - past five quarters

+43%

20%

63%

4%

16%

18%

48%

15%

Nov 07

+59%

12%

71%

3%

9%

17%

56%

15%

May 07

+56%

13%

69%

3%

10%

18%

53%

16%

Feb 07

+59%

12%

71%

2%

10%

18%

54%

17%

Aug 07

+50%*Net Balance

15%Total worried

16%Extremely confident

49%Fairly confident

20%Neutral

12%Fairly worried

3%Extremely worried

65%Total confident

Nov 06


Long term trends in confidence

%

10%

20%

30%

40%

50%

60%

70%

80%

Nov-00

Feb-01

May -01

Aug -01

Nov-01

Feb-02

May -02

Aug -02

Nov-02

Feb-03

May -03

Aug -03

Nov-03

Feb-04

May -04

Aug -04

Nov-04

Feb-05

May -05

Aug -05

Nov-05

Feb-06

May -06

Aug -06

Nov-06

Feb-07

May -07

Aug -07

Nov-07

Confident Worried *Net Balance


* Net balance is defined as the difference between the percentage who are confident and the percentage who are worried.





Confidence by state, sector and sizeConfidence by state, sector and size

* Net balance is defined as the difference be ween the percentage who are confident and the percentage who are worried.t

Key findings

The highest levels of business confidence in the past quarter

were recorded in the Northern Territory. It was the only stateto record a rise. The lowest level of business confidence wasrecorded in New South Wales, with that state also recordingthe largest decline in net confidence levels. Regionalbusinesses reported higher confidence levels than theirmetropolitan counterparts for the first time since February2006. Confidence was highest among SMEs in the financeand insurance sector, and lowest among SMEs in the retailtrade sector. Last quarter (August to October 2007) With overall confidence falling sharply at the national level in

the past quarter, all states recorded falls in confidence, withconfidence unchanged in the Australian Capital Territory, andthe Northern Territory recording the only increase inconfidence. This resulted in the Northern Territory recordingthe highest SME confidence levels in Australia. The lowestlevel of confidence was recorded in New South Wales, whereconfidence was 15 percentage points below average afterrecording the largest decline in the past quarter.

Metro and regional confidence*net balance

55%N/A55%Australian Capital Territory

43 %46 %41 %National

28%34%26%New South Wales

45%49%44%Victoria

52%54%51%Queensland

47%52%45%South Australia

61%60%59%Western Australia

54%48%64%Tasmania

71%70%73%Northern Territory

TotalRegionalMetro


Confidence by sector

66%8%74%Accommodation, Cafes and Restaurants

36%24%60%Cultural, Recreational and Personal

68%10%78%Health and Community Services

75%6%81%Finance and Insurance

49%15%64%Communication Property & Business Services

27%29%56%Transport/Storage

17%36%53%Retail Trade

48%17%65%Wholesale Trade

48%13%61%Building/Construction

42%19%61%Manufacturing

*Net

BalanceWorriedConfident

SOURCE: Sensis® Business Index

Sweeney Research – November 2007

The finance and insurance sector recorded the highest

confidence at a net 75 per cent, an improvement of15 percentage points in the past quarter. The largestimprovement in net confidence was recorded in theaccommodation, cafes and restaurant sector, where confidencerose by 20 percentage points, the only other sector to recordan increase. The lowest confidence level was recorded in theretail trade sector, with a net balance of 17 per cent. For theretail trade sector this was a fall of 15 percentage points in thepast quarter.

On a national basis, confidence was highest among businessesin regional areas, for the first time since February 2006. Thiswas also the case in every state and territory with the onlyexceptions being Tasmania and the Northern Territory wheremetropolitan confidence was higher. The highest overallconfidence by region was recorded amongst SMEs inmetropolitan Darwin, with the lowest confidence beingrecorded in metropolitan New South Wales. The largestimprovement was among those SMEs in metropolitan areas ofTasmania. The largest declines in business confidence wererecorded among SMEs in metropolitan areas of New SouthWales.

Trends by state*net balance

55%

71%

54%

61%

47%

52%

45%

28%

43%

Nov 07

55%

58%

53%

73%

47%

55%

48%

44%

50%

Nov 06

61%

68%

70%

75%

60%

67%

53%

47%

56%

Feb 07

57%

63%

69%

72%

57%

64%

58%

53%

59%

May 07

55%

67%

60%

72%

51%

67%

54%

56%

59%

Aug 07

Australian Capital Territory

Northern Territory

Tasmania

National

New South Wales

Victoria

Queensland

South Australia

Western Australia


Confidence by business size

56%13%69%Total Medium Business

72%7%79%100-199 Employees

54%14%68%20-99 Employees

42%20%62%Total Small Business

33%25%58%10-19 Employees

49%15%64%5-9 Employees



43%20%63%Total

*Net BalanceWorriedConfident







Perceptions of the economyPerceptions of the economy

* Net balance is defined as the difference between the percentage with a positive outlook and the percentage with a negative outlook.

Key findings Net perceptions of the Australian economy improved

significantly among SMEs, rising to their second highest levelin four years. Despite this, SMEs’ future economicexpectations fell further from the previous quarter’s result,but were still higher than at the same time last year. Last quarter (August to October 2007) There was a significant increase in the proportion of SMEsthat felt the economy was currently growing, rising byten percentage points. Coupled with this was a decrease ofone percentage point in the proportion of SMEs that felt theeconomy was currently slowing. This resulted in a significantincrease in the overall perception of the current state of the

economy, with a net balance of positive 50 per cent ofbusinesses believing the Australian economy is currently in agrowth phase. This was an increase of 11 percentage pointsfrom last quarter. The latest increase brings the netproportion of SMEs that felt the economy was currently in agrowth phase to its second highest point in four years, withthe only higher result in this time being two quarters ago,when the net result was one percentage point higher.

With strong economic conditions continuing in resource and

commodity producing regions, SMEs in Western Australiarecorded the strongest perception of the current state of theAustralian economy. A net balance of 77 per cent reported acurrent growth phase, an increase of 15 percentage points.The weakest perceptions were recorded among SMEs in NewSouth Wales, although perceptions still increased significantlyin that state (net balance of 34 per cent, up from 26 per centlast quarter).

This quarter the only state to record declining views of theeconomy was Victoria, with all other states and territoriesrecording improvement from last quarter. The largest

improvement in perceptions was recorded in Tasmania.

Despite the increase in perceptions of the economy now,expectations for the year ahead continued to decline, withnet five per cent of SMEs believing the economy would beworse in a year’s time. The overall decline in futureexpectations was mainly caused by large falls in New SouthWales and Victoria, with expectations in all other states andterritories either unchanged or improved.

The economy

The economy now The economy a year from now

Slowdown

12%

Standingstill

26%

Growth62%

Same57%

Worse24%

Better19%


Perceptions of the economyLong term trends - *net balance

-40%

-20%

%

20%

40%

60%

80%

Nov-00

Feb-01

May -01

Aug -01

Nov-01

Feb-02

May -02

Aug -02

Nov-02

Feb-03

May -03

Aug -03

Nov-03

Feb-04

May -04

Aug -04

Nov-04

Feb-05

May -05

Aug -05

Nov-05

Feb-06

May -06

Aug -06

Nov-06

Feb-07

May -07

Aug -07

Nov-07

The Economy Now The Economy a Year from Now


Perceptions of the economy - trends

-11%

29%

18%

+14%

25%

39%

Nov 06

+13%

14%

27%

+32%

16%

48%

Feb 07

+13%

13%

26%

+51%

8%

59%

May 07

-3%

21%

18%

+39%

13%

52%

Aug 07

-5%

24%

19%

+50%

12%

62%

Nov 07The economy now

Growth

Slowing

*Net Balance

The economy a year from now

Better

Worse

*Net Balance


Perceptions of the economy by state

The economy a year from now

+50%+65%+57%+77%+55%+66%+44%+34%*Net Balance

20%21%17%27%29%22%18%15%Better

19%16%17%17%22%21%26%28%Worse

+1 %+5 %0%+10%+7 %+1 %-8%-13%*Net Balance

63%74%63%82%63%74%60%49%Growth

13%9%6%5%8%8%16%15%Slowing

The economy now

ACTNTTA SWASAQL DVICNS W






Expectations on key indicators for the next 12 months

Key findings With confidence down and SMEs feeling that the economy

was, on balance, likely to be weaker a year from now, mostwere expecting their business performance also to decline inthe next twelve months, with falls across almost allindicators, with the exception of a marginal rise in the priceindicator.

Next 12 months (November 2007 to October 2008) Sales expectations fell during the quarter from 59 per cent to50 per cent, the lowest result since August 2006. This resultwas made up of 61 per cent of businesses that thought saleswould rise in the next year, while 11 per cent expected a fall.

SMEs in Victoria recorded the strongest net sales expectationsby state for the year ahead, with a net balance result of 58per cent. The accommodation, café and restaurant sectorrecorded the strongest industry result with a net balance of72 per cent. At the other end of the spectrum was thetransport and storage sector with a net balance result of 31per cent.

Employment expectations for the year ahead registered a fallwith a net balance of 19 per cent, a drop of four percentagepoints. At a state level the Australian Capital Territory againrecorded the highest results with a net balance of 27 percent. Across the nation, metropolitan businesses recorded

slightly higher employment expectations for the next twelvemonths compared to regional businesses (20 per cent inmetropolitan areas compared to 18 per cent regionally). Atan industry level the wholesale trade, finance and insuranceand accommodation, café and restaurant sectors recordedthe equal strongest results at 27 per cent each. The worstperforming sector in terms of employment expectations forthe year ahead was the transport and storage sector with anet balance of 12 per cent.

The total wages and salary costs expectations for the year

ahead experienced a decrease of four percentage pointsduring the quarter, with a net balance of 38 per cent ofbusinesses expecting an increase. The strongest state wageexpectations for the year ahead were recorded in Victoria(47 per cent). The health and community services sectorwas again the industry expecting the greatest increase inwages over the next year (55 per cent).

Selling prices was the only indicator for which year-aheadexpectations rose, recording a net balance of 57 per cent, upmarginally from 56 per cent. At the state and territory levelthe Northern Territory recorded the strongest selling price

expectations for the year ahead with a net balance result of64 per cent. At an industry level the strongest priceexpectations for the year ahead again came from theaccommodation, café and restaurant sector at 77 per cent.The lowest price expectations for the year ahead wererecorded in the finance and insurance sector at 35 per cent.

In line with sales trends for year ahead, profitabilityexpectations also fell by nine percentage points to theirlowest level since August 2006. The Northern Territoryrecorded the strongest profit expectations for the yearahead with a net balance result of 57 per cent. The lowestexpectations were in New South Wales with a net balance

result of 33 per cent. At an industry level the health andcommunity services sector recorded the strongest annualprofit expectations with a net balance result of 57 per cent.

Capital expenditure also recorded a decline in expectationsfor the year ahead, falling from 16 per cent to 12 per cent.The strongest capital expenditure expectations for the nexttwelve months were recorded in the Northern Territory (18per cent) and in the health and community services sector(35 per cent).

Expectations on key indicators over the next 12 monthsNovember 2007

+12%23%35%Capital expenditure

+44%12%56%Profitability

+57%3%60%Prices charged

+38%6%44%Wages bill

+19%5%24%Size of workforce

+50%11%61%Value of sales

*Net BalanceExpect adecrease

Expect anincrease


Expectations on key indicatorsTrends in *net balance

12%

44%

57%

38%

19%

50%

Nov 07

20%

46%

57%

42%

23%

55%

Nov 06

19%

47%

56%

41%

23%

56%

Feb 07

17%

46%

54%

38%

20%

52%

May 07

16%

53%

56%

42%

23%

59%

Aug 07

Value of sales

Size of workforce

Wages bill

Prices charged

Profitability

Capital expenditure







Concerns

Key findings Finding and keeping staff remained the most pressingconcern faced by SMEs. A lack of work or sales was thesecond most significant problem facing SMEs, with one inthree SMEs reporting that they were currently facing nosignificant problems in their business.

Last quarter (August to October 2007) The proportion of SMEs reporting difficulties finding andkeeping staff increased by one percentage point over thepast quarter to 15 per cent, remaining the top concern facingSMEs in Australia. Reports of difficulties finding and keepingstaff were highest in the Northern Territory and the

Australian Capital Territory, where this problem was beingreported by 27 per cent of SMEs, and lowest in Victoria,where nine per cent reported difficulties in this area. SMEs inthe accommodation, café and restaurant sector were mostlikely to report difficulties finding and keeping staff.

A lack of work or sales was the next most significant problemcited by SMEs in the past quarter. Overall, nine per cent ofSMEs nominated a lack of work or sales as an issue, whichwas unchanged in the past quarter. Concern over a lack ofwork or sales was highest in South Australia where 15 percent of SMEs reported concerns, up five percentage pointfrom last quarter. The retail trade sector again reported thehighest level of concern over a lack of work or sales, with 13per cent of SMEs in that sector reporting problems in thisarea.

Following these key issues were a range of problemsreported by six per cent of SMEs each, including competition(down one percentage point in the past quarter); theeconomic climate (up one percentage point); cash flow andbad debts (unchanged in the past quarter); paperwork andbureaucracy (down one percentage point); andenvironmental disasters (up one percentage point).

Concerns about the economic climate, which includes suchissues as consumer confidence and spending levels, interestand exchange rate concerns, concerns about the generaleconomic climate, as well as global, state and regionaleconomic concerns, were most likely to be reported inVictoria (eight per cent) and in the retail trade and cultural,recreational and personal services sectors (14 per cent each).Overall, decreases in consumer spending levels were ofgreatest concern, followed by concerns over rising interestrates.

Some 33 per cent of SMEs reported currently facing noproblems in their business, down by six percentage points inthe past quarter.

Prime concernsNovember 2007

9%

6%

6%

6%

6%

6%

3%

3%

3%

2%

2%

15%Finding/keeping staff

Lack of work/sales

Competition

Economic climate

Cash flow

Paperwork/bureacracy

Environment/local disasters

Costs/overheads

Time pressures

Fuel costs

Taxes

Employment costs and regulations

Q. As far as your business is concerned, what problems, if any, are you facing at the moment?

No concerns = 33%



Prime concernsLong term trends – finding quality staff

%

2%

4%

6%

8%

10%

12%

14%

16%

18%

Aug -00

Nov-0

0

Feb-0

1

May -01

Aug -01

Nov-0

1

Feb-0

2

May -02

Aug -02

Nov-0

2

Feb-0

3

May -03

Aug -03

Nov-0

3

Feb-0

4

May -04

Aug -04

Nov-0

4

Feb-0

5

May -05

Aug -05

Nov-0

5

Feb-0

6

May -06

Aug -06

Nov-0

6

Feb-0

7

May -07

Aug -07

Nov-0

7


Prime concernsLong term trends – lack of work or sales

%

5%

10 %

15 %

20 %

25 %

30 %

Fe

Au F

eAu F

eAu F

eAu F

eAu F

eAu F

eAu F

eAu F

eAu F

eAu F

eAu F

eAu

b-96

g -96

b-97

g -97

b-98

g -98

b-99

g -99

b-00

g -00

b-01

g -01

b-02

g -02

b-03

g -03

b-04

g -04

b-05

g -05

b-06

g -06

b-07

g -07






SalesSales

* Net balance is defined as the diffe ence between the percentage with a positive outlook and the percentage with a negative outlook.r

Key findings

There was a significant decline in the proportion of SMEs, onbalance, that reported increased sales over the past quarter,reversing most of the growth in this indicator recorded overthe past year. There were also sharp falls in the proportionof SMEs expecting growth in sales levels in both the shortand medium terms. Last quarter (August to October 2007) Sales performance recorded a higher net balance of 15 percent for the quarter, down by four percentage points fromlast quarter and at the same level as recorded twelvemonths ago.

Sales performance again varied dramatically across the statesand territories. The Northern Territory recorded the strongestperformance, where a net 34 per cent experiencedincreasing sales in the past quarter. At the other end of thescale, sales performance was lowest among SMEs in NewSouth Wales, where only a net six per cent of SMEs reportedincreasing sales. The strongest sales performance was recorded in theaccommodation, café and restaurant sector, with a netbalance of 42 per cent of SMEs having reported increasingsales. The cultural, recreational and personal services sectorrecorded the weakest industry performance, at net negativefive per cent.

Current quarter (November 2007 to January 2008)

SMEs were expecting a further decrease in sales in the shortterm. Sales expectations for the current quarter recorded asharp fall of 14 percentage points from the previous quarterto net 26 per cent, the lowest result since May 2005. Expectations for sales growth again varied around thecountry, with the strongest expectations recorded inTasmania at net 55 per cent. The weakest sales expectationsfor the coming quarter were recorded in the NorthernTerritory at a net 14 per cent. There was also variation in expectations on an industry basis.The strongest expectations for the current quarter were

recorded in the health and community services sector (netbalance of 41 per cent). The building and construction sectorrecorded the lowest level of expectations (net two per cent). Next 12 months (November 2007 to October 2008) Twelve-month sales expectations fell sharply from a net 59per cent to 50 per cent, the highest result since November2005. The result comprised 61 per cent of businesses thatbelieved sales would increase in the year ahead and 11 percent that thought they would fall. Sales expectations for theyear ahead were highest in Victoria at net 58 per cent.

Value of sales

+26%

16%

41%

42%

+15%

25%

35%

Value of salesTrends in *net balance

Experience and Expectations for the Three Months Ending:-

-30%

-20%

-10%

%

10%

20%

40%41 39 43% 43%E

Nov 07

+32%

14%

39%

46%

+15%

26%

32%

%

Nov 06

+35%

14%

37%

49%

+14%

25%

35%

%

Feb 07

+32%

13%

42%

45%

+17%

26%

31%

May 07

+40%

9%

41%

49%

+19%

24%

32%

Aug 07

*Net Balance

Expect decrease

No change

Expect increase

Current Quarter

xperienced increase

No change

Experienced decrease

*Net Balance

Last Quarter


30%

40%

50%

Oct-00

J an-01

Apr-01

J ul-01

Oct-01

J an-02

Apr-02

J ul-02

Oct-02

J an-03

Apr-03

J ul-03

Oct-03

J an-04

Apr-04

J ul-04

Oct-04

J an-05

Apr-05

J ul-05

Oct-05

J an-06

Apr-06

J ul-06

Oct-06

J an-07

Apr-07

J ul-07

Oct-07

J an-08

Experience Expectations






Employment

Key findings

Employment declined to its lowest level since August 2006during the past quarter. This was reflected in the net balanceresult of zero per cent of businesses that experienced a risein employment trends during the quarter down from four percent last quarter. SMEs were expecting further decreases inemployment in both the coming quarter and the year ahead.

Last quarter (August to October 2007)

The proportion of SMEs that reported increased employmentduring the past quarter fell, with the 13 per cent of SMEsreporting a rise in employment during the past quarter. Thiswas offset by the 13 per cent of businesses that experiencedemployment declines, the net balance of zero per cent wasfour percentage point lower than last quarter’s result, andthe lowest recorded since August 2006.

Notable regional variation was once again seen acrossAustralia. At a state level the best performing region was theNorthern Territory at 19 per cent. At the other end of thescale, New South Wales recorded a net balance result ofnegative six per cent, reflecting that more SMEs in that staterecorded declining employment levels than rising. At anindustry level the accommodation, café and restaurant sector

recorded the strongest result at 23 per cent while the retailsector recorded the lowest results at negative six per cent.

A lack of work or sales remained the main barrier to takingon new employees, reported by 18 per cent of SMEs thatbelieved barriers existed, down nine percentage point.


Employment expectations for the current quarter rose to anet balance of 10 per cent, the lowest result since August2006. Western Australia recorded the strongest short-term

employment expectations at a net balance of 18 per cent. Atthe other end of the spectrum was the Northern Territorywith a net balance result of three per cent. On an industrybasis, the strongest expectations were in theaccommodation, café and restaurant sector (21 per cent).

Next 12 months (November 2007 to October 2008)

Employment expectations for the year ahead also fell to anet balance result of 19 per cent. This was a fall of fourpercentage points in the past quarter. The strongest

expectations for the year ahead were recorded in theAustralian Capital Territory (net 27 per cent), with theweakest in South Australia (13 per cent).


Size of workforce

+10%

3%

82%

13%

0%

13%

74%

13%

Nov 07

+12%

3%

80%

15%

+4%

12%

72%

16%

Nov 06

+12%

3%

82%

15%

+1%

12%

75%

13%

Feb 07

+11%

2%

85%

13%

+5%

10%

75%

15%

May 07

+15%

2%

81%

17%

+4%

10%

76%

14%

Aug 07

*Net Balance

Expect decrease

No change

Expect increase

Current Quarter

Last Quarter

Experienced increase

No change


*Net Balance



Size of workforceTrends in *net balance

Experience and Expectations for the Three Months Ending:--4%

-2%

%

2%

4%

6%

8%

10%

12%

14%

16%

Oct-00

J an-01

Apr-01

J ul-01

Oct-01

J an-02

Apr-02

J ul-02

Oct-02

J an-03

Apr-03

J ul-03

Oct-03

J an-04

Apr-04

J ul-04

Oct-04

J an-05

Apr-05

J ul-05

Oct-05

J an-06

Apr-06

J ul-06

Oct-06

J an-07

Apr-07

J ul-07

Oct-07

J an-08



18%

15%

7%

5%

5%

5%

5%

4%

3%

3%

3%

Lack of work/sales

Finding suitable staff

Costs

Profitability

Lack of qualified staff

Lack of consistent work

Lack of money/capital

Work load/work volume

Don't need any more staff

Lack of space

Drought/weather conditions

What are the barriers to taking on new employees?November 2007

Note: Base = those who believebarriers or impediments exist(49% of all respondents)






Wages billWages bill

Key findings

The only performance indicator to record an increase in thenet balance of SMEs was total wage costs, which increasedmarginally during the last quarter. However, lowerproportions of SMEs were expecting increases in their wagesbills for both the short and medium terms.

Last quarter (August to October 2007) The most recent quarter saw a marginal increase in theproportion of SMEs reporting increased wage costs, with theperformance result up one percentage point to a net 16 percent, bringing this indicator to its highest level sinceNovember 2005.

During the quarter, 28 per cent of SMEs experienced a rise intotal wage costs, while 12 per cent recorded a decline. SMEsin Queensland, Western Australia and the Northern Territoryrecorded the highest net result in total wage costs (net 22per cent each), while the lowest wage pressures were in theAustralian Capital Territory (net four per cent). The strongestnet result in total wage costs was again recorded in thehealth and community services sector (net 54 per cent).


SMEs were expecting falls in wages in the short term, withexpectations for total wage costs falling significantly to a net18 per cent for the current quarter from 24 per cent lastquarter, the lowest short-term wage expectations recordedsince August 2006. The highest wage expectations were inVictoria, with a net balance of 26 per cent of SMEs expectingan increase in their total wages bill in the coming quarter.SMEs in the Northern Territory were least likely to beexpecting an increase in their wages bill in the currentquarter (net 12 per cent).

Next 12 months (November 2007 to October 2008)

Expectations for total wage and salary costs for the comingyear also fell during the quarter, with a net balance of 38 percent of businesses expecting a rise in total wage costs in theyear ahead. This represented a decrease in the net balancetrend of four percentage points. The SMEs most likely to beexpecting increases to their wages bills were in Victoria at anet 47 per cent. SMEs in New South Wales were least likelyto expect an increase in their total wages bill in the comingyear (net 28 per cent).

Wages bill

+18%

8%

61%

26%

+16%

12%

56%

28%

Nov 07

+20%

7%

63%

27%

+12%

14%

55%

26%

Nov 06

+23%

6%

61%

29%

+15%

12%

57%

27%

Feb 07

+19%

6%

69%

25%

+12%

13%

62%

25%

May 07

+24%

5%

62%

29%

+15%

11%

57%

26%

Aug 07

*Net Balance

Expect decrease

No change

Expect increase

Current Quarter

Last Quarter


No change


*Net Balance


Wages billTrends in *net balance


-5%

%

5%

10%

15%

20%

25%

30%

35%

Oct-00

J an-01

Apr-01

J ul-01

Oct-01

J an-02

Apr-02

J ul-02

Oct-02

J an-03

Apr-03

J ul-03

Oct-03

J an-04

Apr-04

J ul-04

Oct-04

J an-05

Apr-05

J ul-05

Oct-05

J an-06

Apr-06

J ul-06

Oct-06

J an-07

Apr-07

J ul-07

Oct-07

J an-08








PricesPrices

* Net balance is defined as the diffe ence between the percentage with a positive outlook and the percentage with a negative outlook.r

Key findings

The net proportion of SMEs that increased their prices fellduring the past quarter. Looking ahead, fewer SMEs wereexpecting to increase their prices in the short term,however in the medium term there was a small increasein the proportion expecting to increase their prices. Last quarter (August to October 2007)

The proportion of businesses that increased prices fell bytwo percentage points during the quarter, to a netbalance result of 20 per cent. This result reverses half ofthe increase recorded last quarter and is two percentage

points lower than at the same time last year. Of all states and territories, the strongest price trendswere recorded in Tasmania, with a net balance of 31 percent. The lowest results were recorded in New SouthWales, with a net balance of 13 per cent. The strongestprice rises were recorded in the wholesale trade sector,with a net balance result of 28 per cent. The weakestoutcome was recorded in the manufacturing sector, with anet balance result of 14 per cent. Current quarter (November 2007 to January 2008)

SME expectations for price rises in the short termdecreased during the quarter to a net balance result of 27per cent, a fall of two percentage points since the lastquarter, again reversing half of last quarter’s rise inexpectations. The Australian Capital Territory recorded thestrongest price rise expectations, with a net balance resultof 32 per cent, while Tasmania and the Northern Territoryrecorded the weakest price rise expectations, with a netbalance of 23 per cent each. Next 12 months (November 2007 to October 2008)

At a net balance of 57 per cent, expectations for pricerises in the coming year increased further during the pastquarter, with prices being the only year-ahead indicator torecord an increase in expectations. Year-aheadexpectations for price increases were strongest amongSMEs in the Northern Territory at net 64 per cent, andweakest among those in New South Wales at net 52 percent.

The strongest price rise expectations for the year aheadwere recorded in the cultural, recreational and personalservices sector, with a net balance result of 77 per cent.The weakest selling price expectations were again

recorded in the finance and insurance sector (net 35 percent).

Prices charged

+27%

3%

68%

30%

+20%

5%

70%

25%

Nov 07

+27%

2%

68%

29%

+22%

4%

70%

26%

Nov 06

+29%

2%

67%

31%

+21%

4%

71%

25%

Feb 07

+25%

2%

71%

27%

+18%

3%

76%

21%

May 07

+29%

1%

69%

30%

+22%

2%

74%

24%

Aug 07

*Net Balance

Expect decrease

No change

Expect increase

Current Quarter

Last Quarter


No change


*Net Balance


-10%

%

10%

20%

30%

40%

50%

60%

Oct-00

J an-01

Apr-01

J ul-01

Oct-01

J an-02

Apr-02

J ul-02

Oct-02

J an-03

Apr-03

J ul-03

Oct-03

J an-04

Apr-04

J ul-04

Oct-04

J an-05

Apr-05

J ul-05

Oct-05

J an-06

Apr-06

J ul-06

Oct-06

J an-07

Apr-07

J ul-07

Oct-07

J an-08


Prices chargedTrends in *net balance

Experience and expectations for the three months ending:-








Profitability

Key findings

Profitability remained relatively strong during the pastquarter, with only a marginal fall in the net proportion ofSMEs reporting increases. While profitability performance wassolid during the quarter SMEs were expecting significant fallsfor both the coming quarter and the year ahead.

Last quarter (August to October 2007) Profitability performance recorded a net balance result of 11per cent for the past quarter. This represented only amarginal decline of one percentage point from the previousquarter’s result of 12 per cent. Across Australia the strongest profit experience occurred inthe Northern Territory with a net balance result of 29 percent. The weakest performance was recorded in New SouthWales at four per cent. The strongest industry performancewas recorded in the finance and insurance sector with a netbalance result of 39 per cent, with the weakest profitabilityperformance recorded in the cultural, recreational andpersonal services sector (net negative three per cent). SMEsin metropolitan areas experienced marginally betterprofitability than their regional counterparts. Current quarter (November 2007 to January 2008) Despite the relatively solid result this quarter, profitabilityexpectations for the current quarter recorded a dramatic fallto 22 per cent compared to the previous quarter’s results of36 per cent. This was the lowest short-term profitabilityresult recorded since May 2006. At a state level, thestrongest expectations were recorded in Tasmania at 48 percent. The weakest region was New South Wales with a netbalance result of 11 per cent. Across all industries, the transport and storage sectorrecorded the strongest short-term profit expectations with anet balance result of 37 per cent. The building andconstruction sector recorded the weakest short-term profitexpectations with a net balance result of zero per cent. Next 12 months (November 2007 to October 2008)

Profitability expectations for the year ahead also fell stronglyduring the quarter, at a net balance result of 44 per cent,down from 53 per cent last quarter. At a state level thestrongest profit expectations were recorded in the NorthernTerritory with a net balance result of 57 per cent. Theweakest results were recorded in New South Wales with anet balance result of 33 per cent. At an industry level the

strongest result was recorded in the health and communityservices sector (57 per cent), with the weakest resultrecorded in the retail sector (32 per cent).

Profitability

+22%

18%

41%

40%

+11%

25%

39%

36%

Nov 07

+27%

14%

43%

41%

+11%

27%

34%

38%

Nov 06

+31%

14%

40%

45%

+10%

25%

39%

35%

Feb 07

+27%

14%

45%

41%

+12%

27%

34%

39%

May 07

+36%

11%

42%

47%

+12%

25%

37%

37%

Aug 07

*Net Balance

Expect decrease

No change

Expect increase

Current Quarter

Last Quarter


No change


*Net Balance



ProfitabilityTrends in *net balance


-20%

-10%

%

10%

20%

30%

40%

50%

Oct-00

J an-01

Apr-01

J ul-01

Oct-01

J an-02

Apr-02

J ul-02

Oct-02

J an-03

Apr-03

J ul-03

Oct-03

J an-04

Apr-04

J ul-04

Oct-04

J an-05

Apr-05

J ul-05

Oct-05

J an-06

Apr-06

J ul-06

Oct-06

J an-07

Apr-07

J ul-07

Oct-07

J an-08








Exports

Key findings The proportion of SMEs that exported goods in the pastquarter increased strongly, however this was balanced by aslight decrease in proportion of exporting SMEs reportinggrowth in the value of their exports.

Last quarter (August to October 2007) Seventeen per cent of SMEs reported exporting in the pastquarter, up by three percentage points from the previousquarter. The stronger result was primarily due to strongincreases in the proportion of SMEs exporting in New SouthWales and to a lesser extent the Northern Territory. Only

Tasmania and the Australian Capital Territory, recorded falls inthe proportion of SMEs reporting exports in the past quarter.Queensland and Western Australia also recorded smallincreases in the proportion of SMEs that reported exporting.

SMEs with significant growth plans were two and a half timesas likely to export as those with no plans for growth (25 percent compared to ten per cent). SMEs in metropolitan areaswere almost three times as likely to export as their regionalcounterparts (22 per cent compared to eight per cent).

SMEs in the wholesale trade sector were again the most likelyto have exported in the past quarter, with participation in that

sector rising by three percentage points to 38 per cent. SMEsin the transport and storage sector reported the lowest levelof export activity in the past quarter.

There was however a small fall in the net proportion ofexporting SMEs that reported growth in the value of theirexports. A net balance of 14 per cent reported an increase inthe value of the goods and services exported in the pastquarter, down two percentage points from last quarter’s netbalance of 16 per cent.

Looking forward, SMEs were expecting further softening in the

value of their exports. In the short term, there was a decreaseof six percentage points in the proportion of SMEs expectinggrowth in the value of their exports for the coming quarter.There was also a decrease of one percentage point in theproportion of SMEs expecting to increase the value of theirexports in the year ahead. However, despite the softeningrecorded this quarter, both results are significantly higher thanwas the case twelve months ago.

New Zealand was again the most favoured destination forSME exports in the past quarter, with 46 per cent of exportingSMEs exporting to New Zealand. Other strong results wereseen for the United States, to which 34 per cent of exporting

SMEs exported, and the United Kingdom, which came in thirdat 28 per cent.


17%

23%

16%

14%

14%

14%

8%

20%

11%

National

New South Wales

Victoria

Queensland

South Australia

Western Australia

Tasmania

Northern Territory


Proportion of SMEs exporting in last yearby state and territory

SOURCE: Sensis ® Business Index


17%

38%

32%

21%

19%

18%

16%

10%

5%

5%

4%

Total

Wholesale Trade

Manufacturing

Health and Community Services

Business Services

Accommodation/Cafes/Restaurants

Retail Trade

Personal Services

Building/ConstructionFinance and Insurance

Transport/Storage

Proportion of SMEs exporting in last yearby business sector


Value of exports - trends

+48%

8%

37%

56%

+26%

9%57%

35%

+14%

16%

54%

30%

Nov 07

+40%

7%

44%

49%

+10%

17%57%

27%

+11%

20%

49%

31%

May 07

+49%

3%

45%

52%

+32%

7%54%

39%

+16%

15%

55%

31%

Aug 07

Base : Exported goods or services overseasin last three months

+42%

7%

42%

50%

+18%

13%57%

31%

+7%

16%

62%

23%

Nov 06

Next 12 months

50%Expect increase

40%No change

10%Expect decrease

+43%*Net Balance

+22%

13%52%

35%

+8%

18%

57%

26%

Feb 07

*Net Balance

Expect decreaseNo change

Expect increase

Current Quarter

Last Quarter


No change


*Net Balance






Assessment of Federal Government policies

Key findings

Support among SMEs for the Federal Government recorded a

strong increase during the quarter, reaching its highest levelsince May 1996. This result has now been net positive for 12out of the last 13 quarters, with the Federal Governmentbeing the most supported government in Australia by SMEs.

Last quarter (August to October 2007)

The net balance result of a positive 29 per cent approvalrating represented a rise of nine percentage points in thepast quarter, making this the second strongest resultrecorded in the history of the Sensis® Business Index , withthe only higher result being in May 1996. The Federal

Government’s result has now been net positive for 12 out ofthe last 13 quarters since the last Federal election. The resultcomprised 46 per cent of businesses that were supportive ofthe Federal Government’s small business policies, and 17 percent that felt their policies worked against small business.

The strongest support for the Federal Government’s policiesagain occurred in the Northern Territory, where businessesrecorded a positive 39 per cent net balance. The region mostcritical of the Federal Government’s small business policieswas Tasmania, where the net balance of SMEs that felt theFederal Government’s policies supported small business wasstill a strong 18 per cent. All states and territories recorded a

net positive result for SME support of the FederalGovernment.

SMEs in regional areas were more supportive of the FederalGovernment than those in metropolitan areas. Mediumbusinesses were more supportive of the Federal Governmentthan small businesses, and businesses aiming for significantgrowth were also more supportive than those not aiming forgrowth.

Once again, the Federal Government’s industrial relationspolicies were by far the main reason SMEs gave for believing

the Federal Government was trying to support smallbusiness. This view was strongest among SMEs in Victoriaand Western Australia. Being supportive of small businessesand trying to help small businesses were the next mostfrequent responses, although at a much lower rates. The keyreasons SMEs believed the Federal Government’s policiesworked against them were: the belief the FederalGovernment was only concerned with big business; theamount of bureaucracy; and the amount of paperwork.

In general, the first things that SME operators wanted to seewhichever party that was elected do were to continue doingwhat they are doing, to review taxes and to fix the health

system.

Attitudes to Federal Government policies

past five quarters

+10%

46%

22%

32%

Nov 06

+11%

43%

23%

34%

Feb 07

+25%

37%

19%

44%

May 07

+20%

44%

18%

38%

Aug 07

+29%

37%

17%

46%

Nov 07

Supportive

Work against

No impact

*Net Balance

Q. Thinking about the current Federal Government, do you believe that their policies are supportive of small business, work against small business or have no real impact either way?


Attitudes to Federal Government policiesLong-term trends

%

10%

20%

30%

40%

50%

60%

Nov-00

Feb-01

May -01

Aug -01

Nov-01

Feb-02

May -02

Aug -02

Nov-02

Feb-03

May -03

Aug -03

Nov-03

Feb-04

May -04

Aug -04

Nov-04

Feb-05

May -05

Aug -05

Nov-05

Feb-06

May -06

Aug -06

Nov-06

Feb-07

May -07

Aug -07

Nov-07

Supportive Work against


* Net balance is defined as the difference between the percentage with a positive outlook and the percentage w th a ne i gative ou loo t k.





Assessment of State Government policies

Key findings

With a solid increase in support, the Northern TerritoryGovernment was the most popular state or territorygovernment in Australia among SMEs in the past quarter. TheNew South Wales Government remained the least popularstate or territory government among SMEs for the 15thsuccessive quarter, despite a further rise in support within thestate.

Last quarter (August to October 2007) The Northern Territory Government recorded the highestapproval rating from SMEs at net positive sixteen per cent. Thisresult was up 27 percentage points from net negative 11 per

cent last quarter. Consultation with small business was themain reason given by SMEs for their support of the NorthernTerritory Government, followed by their small businessmanagement training programmes as well as providingincentives for small businesses.

The Victorian and Queensland Governments achieved the nexthighest ratings from SMEs, recording net positive one per centand net negative four per cent respectively. The main reasonsSMEs gave for supporting both of these governments was abelief that they were more supportive of small businesses.Both the Victorian Government and the Queensland

Government recorded increases in support from SMEs duringthe past quarter.

The only other government to record an increase in supportwas the New South Wales Government. Despite thisimprovement, the New South Wales Government remained theleast supported government among SMEs. This was the 15thsuccessive quarter that the New South Wales Government hasrecorded the lowest result of any state or territory government,now sitting at net negative 30 per cent. The key reasons SMEsgave for not supporting the New South Wales Governmentwere the levels of costs and charges in the state, a feeling thatthey didn’t understand small business and a belief that there

was too much bureaucracy.

Attitudes to state or territory government policiesNovember 2007

50%38%53%53%54%53%61%46%No impact

15%39%11%17%17%22%20%12%Supportive

35%23%36%30%29%26%19%42%Work against

-20%16 %-25%-13%-12%-4%1%-30%*Net Balance

AC TNTTA SWASAQL DVICNS W

Q. Thinking about the current State/Territory Government, do you believe that their policies are supportive of small business, work against small business or have no real impact either

way?


Attitudes to state or territory government policiesTrends in *net balance

-20%

16%

-25%

-13%

-12%

-4%

1%

-30%

No v2007

-15%

-12%

+9%

-17%

-5%

-6%

-16%

-24%

No v2006

-12%

+1%

-8%

-14%

-4%

-6%

-6%

-34%

Feb2007

-4%

+8%

-7%

-21%

-10%

-7%

+4%

-40%

Ma y2007

-7%

-11%

-25%

-7%

-11%

-18%

-3%

-32%

Au g2007


Northern Territory

Tasmania

Western Australia

South Australia

Queensland

Victoria

New South Wales


* Net balance is defined as the diffe ence be ween the percentage with a positive outlook and the percentage with a negative outlook.r t





Workplace Relations

Workplace relations trends

Perceived impact of changes to workplace relations

environment on the business

D on ' t kn ow

2%

Nega t i ve

impact

6%

No rea l

impact

73 %

Posi t ive

impact

19 %

Q. Do you believe that the workplace relations changes – Work Choices - will have a positive impact on your business, a negative impact, or no real impact either way?


The Sensis® Business Index found that SME operators felt that

changes to the workplace relations system have a net positiveimpact on their businesses, at a net 13 per cent. Thisrepresented a marginal decline of one percentage point fromthe previous quarter. Some seventeen per cent of SMEs wereplanning on making some changes in their business as a resultof the workplace relations changes, with hiring more staffbeing the top priority for small businesses.

To date, some 12 per cent of SMEs reported that they hadmade changes in their business as a result of changes to theworkplace relations system. The main change made was tohire new employees, followed by implementing new

workplace agreements.

Awareness of the new Fairness Test changes to the system hasincreases strongly in the past quarter, with 73 per cent of SMEsnow aware of the changes, up from 55 per cent last quarter.Some 42 per cent of SMEs reported having provided employeeswith the workplace relations fact sheet.

Generational differences in the workplace

Comparing baby boomer, Generation X and Generation Y employees

Preferred generation for employing

Don ' t know

5%

Don ' t ca re

25 %Gene ra t i on

X

28 %

Gene ra t i on

Y

13 %

Baby

boom e rs

29 %

Q. Overall, if you had the choice, which generation would you prefer to recruit?


With new generations entering the workforce, it is interestingto examine the views of SME owners on the dynamics of thedifferent generations in the workplace, as well as their viewson each generation’s strengths and weaknesses. Overall, SMEowners were almost equally likely to want to hire BabyBoomers and Generation X employees (29 per cent and 28 percent respectively). By comparison, Generation Y employeeswere nominated by only 13 per cent of SME operators. Overall,one in four SME operators reported that they had no specificpreference between the generations as employees.

SME operators in Queensland were the most likely to prefer

Baby Boomer employees in their business. Generation Xemployees were most favoured by SMEs in the AustralianCapital Territory, with SMEs in New South Wales more likelythan other states and territories to prefer a Generation Yemployee. Victorian SME operators were the most likely toreport not having a particular preference between the differentgenerations for recruitment purposes.

The greatest benefits of Baby Boomer employees were theirreliability and experience, with a lack of technical skills beingthe greatest drawback. For Generation X the greatest benefitswere reliability, technical skills and enthusiasm, with familycommitments being the greatest drawback. SME operators

saw enthusiasm as Generation Y’s greatest benefit, with lack ofreliability their greatest drawback.





Small and medium business outlook – national

- Business confidence fell dramatically, recording the lowest result in six years and the largest one-quarter declinesince the inception of the Sensis® Business Index .

- Perceptions of the current state of the economy rose significantly however future economic expectations fell.

- Performance in sales, employment, profitability, prices, and capital expenditure all fell.

- The only performance indicator that rose in the past quarter was wages, which recorded a very marginal increase.

- All expectations fell for the short term and the year ahead, with the exception of prices which rose marginally overthe medium term.

- Support for the Federal Government’s policies rose to a net positive 29 per cent, remaining the most supportedgovernment in Australia by SMEs.

+43

20

63

NOV

2007

%

+59+59+56+50NET BALANCE

12121315NEGATIVE

71716965POSITIVE

AUG

2007

%

MAY

2007

%

FEB

2007

%

NOV

2006

%CONFIDENCE IN OWN BUSINESS PROSPECT IN NEXT 12 MONTHS

Trends in past three months’ experience and current quarter expectations – national

+43

20

63

NOV

2007

%


12121315NEGATIVE

71716965POSITIVE

AUG

2007

%

MAY

2007

%

FEB

2007

%

NOV

2006


Trends in past three months’ experience and current quarter expectations – national

-8

29

21

+1 0

25

35

+2 1

4

25

+1 5

12

27

+1

12

13

+1 4

25

39

NOV-JAN

06/07%

-5

25

20

+1 1

27

38

+2 2

4

26

+1 2

14

26

+4

12

16

+1 5

26

41

AUG-OC T06%

* Net balance is defined as the difference between the percentage of small businesses reporting an increase and the percentage reporting adecrease.

-2-1+1+4-2-3+2-2NET BALANCE

2524252526262427DECREASE

2323262924232625INCREASECAPITALEXPENDITURE:

+2 2+3 6+2 7+3 1+2 7+1 1+1 2+1 2NET BALANCE

1811141414252527DECREASE

4047414541363739INCREASE

PROFITABILITY:

+2 7+2 9+2 5+2 9+2 7+2 0+2 2+1 8NET BALANCE

31222523DECREASE

3030273129252421INCREASE

PRICES:

+1 8+2 4+1 9+2 3+2 0+1 6+1 5+1 2NET BALANCE

85667121113DECREASE

2629252927282625INCREASE

WAGES BILL:

+1 0+1 5+1 1+1 2+1 20+4+5NET BALANCE

32233131010DECREASE

1317131515131415INCREASESIZE OFWORKFORCE:

+2 6+4 0+3 2+3 5+3 2+1 5+1 9+1 7NET BALANCE

169131414252426DECREASE

4249454946404343INCREASE

SALES VALUE:

NOV-JAN

07/08%

AUG-OC T07%

MAY-JUL07%

FEB-AP R07%

NOV-JAN

06/07%

AUG-OC T07%

MAY-JUL07%

FEB-AP R07%

TOTAL SMALL AND MEDIUM BUSINESS –NATIONAL

EXPECTATIONS FOR:-ACTUAL EXPERIENCE DURING:-

-8

29

21

+1 0

25

35

+2 1

4

25

+1 5

12

27

+1

12

13

+1 4

25

39

NOV-JAN

06/07%

-5

25

20

+1 1

27

38

+2 2

4

26

+1 2

14

26

+4

12

16

+1 5

26

41

AUG-OC T06%


-2-1+1+4-2-3+2-2NET BALANCE

2524252526262427DECREASE


+2 2+3 6+2 7+3 1+2 7+1 1+1 2+1 2NET BALANCE

1811141414252527DECREASE

4047414541363739INCREASE

PROFITABILITY:

+2 7+2 9+2 5+2 9+2 7+2 0+2 2+1 8NET BALANCE

31222523DECREASE

3030273129252421INCREASE

PRICES:

+1 8+2 4+1 9+2 3+2 0+1 6+1 5+1 2NET BALANCE

85667121113DECREASE

2629252927282625INCREASE

WAGES BILL:

+1 0+1 5+1 1+1 2+1 20+4+5NET BALANCE

32233131010DECREASE


+2 6+4 0+3 2+3 5+3 2+1 5+1 9+1 7NET BALANCE

169131414252426DECREASE

4249454946404343INCREASE

SALES VALUE:

NOV-JAN

07/08%

AUG-OC T07%

MAY-JUL07%

FEB-AP R07%

NOV-JAN

06/07%

AUG-OC T07%

MAY-JUL07%

FEB-AP R07%

TOTAL SMALL AND MEDIUM BUSINESS –NATIONAL






Small and medium business outlook – New South Wales

- Business confidence declined dramatically during the quarter, to be the lowest of any state or territory and the equallowest ever recorded for New South Wales since the inception of the Sensis® Business Index .

- SMEs in New South Wales reported the lowest perceptions of the economy in the past quarter.

- New South Wales saw decreases in performance in sales, employment, prices and profitability and capitalexpenditure, with wages the only performance indicator to record a rise.

- For the last quarter, SMEs in New South Wales recorded the lowest performance for sales, employment, prices andprofitability of any state or territory.

- For the year ahead, SMEs in New South Wales recorded the lowest levels of expectations for sales, wages, prices andprofitability.

- Support for the policies of the New South Wales Government rose however remained the lowest level for any stateor territory government for the 15th successive quarter.

+28

26

54

NOV

2007

%


11141615NEGATIVE

68676359POSITIVE

AUG

2007

%

MAY

2007

%

FEB

2007

%

NOV

2006


Trends in past three months’ experience and current quarter expectations – New South

Wales

+28

26

54

NOV

2007

%


11141615NEGATIVE

68676359POSITIVE

AUG

2007

%

MAY

2007

%

FEB

2007

%

NOV

2006


Trends in past three months’ experience and current quarter expectations – New South

Wales

-11

30

19

+7

27

34

+20

5

25

+15

12

27

-2

13

11

+17

25

42

NOV-

JAN

06/07

%

-2

21

19

+9

30

39

+18

5

23

+8

15

23

+4

11

15

+11

29

40

AUG-

OCT

06

%


-6+2-50+2-4-2+1NET BALANCE

2823272723262424DECREASE


+11+12+25+37+31+4+13+10NET BALANCE

2213171412262529DECREASE

3325425143303839INCREASE

PROFITABILITY:

+27+23+22+28+29+13+21+16NET BALANCE

21332624DECREASE

2924253131192320INCREASE

PRICES:

+14+22+14+23+13+17+10+8NET BALANCE

96857121415DECREASE

2328222820292423INCREASE

WAGES BILL:

+10+15+9+12+10-6+1+2NET BALANCE

21112151011DECREASE


+16+36+27+42+38+6+18+9NET BALANCE

1911161312292530DECREASE

3547435550354339INCREASE

SALES VALUE:

NOV-

JAN

07/08

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%

NOV-

JAN

06/07

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%

TOTAL SMALL AND MEDIUM BUSINESS –

NEW SOUTH WALES


-11

30

19

+7

27

34

+20

5

25

+15

12

27

-2

13

11

+17

25

42

NOV-

JAN

06/07

%

-2

21

19

+9

30

39

+18

5

23

+8

15

23

+4

11

15

+11

29

40

AUG-

OCT

06

%


-6+2-50+2-4-2+1NET BALANCE

2823272723262424DECREASE


+11+12+25+37+31+4+13+10NET BALANCE

2213171412262529DECREASE

3325425143303839INCREASE

PROFITABILITY:

+27+23+22+28+29+13+21+16NET BALANCE

21332624DECREASE

2924253131192320INCREASE

PRICES:

+14+22+14+23+13+17+10+8NET BALANCE

96857121415DECREASE

2328222820292423INCREASE

WAGES BILL:

+10+15+9+12+10-6+1+2NET BALANCE

21112151011DECREASE


+16+36+27+42+38+6+18+9NET BALANCE

1911161312292530DECREASE

3547435550354339INCREASE

SALES VALUE:

NOV-

JAN

07/08

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%

NOV-

JAN

06/07

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%


NEW SOUTH WALES






Small and medium business outlook – Victoria- Business confidence fell sharply during the quarter, however it was above the national average for the first time

since May 2006.

- Victoria was the only state or territory to record decreasing perceptions of the economy in the past quarter.

- Performance indicators for sales, prices and profitability all rose for Victorian SMEs in the past quarter

- Victorian SMEs recorded falls in the past quarter for employment, wages and capital expenditure.

- Victorian SMEs are expecting falls in all indicators in the coming quarter with the exception of wages and capitalexpenditure.

- Victorian SMEs recorded the highest wages expectations for the next quarter.

- Victorian SMEs recorded the highest sales and wages expectations for the year ahead.

- SME support for the Victorian Government rose during the quarter and was the second most supported state orterritory government by SMEs.

+45

19

64

NOV

2007

%


14121516NEGATIVE

68706864POSITIVE

AUG

2007

%

MAY

2007

%

FEB

2007

%

NOV

2006


Trends in past three months’ experience and current quarter expectations – Victoria

+45

19

64

NOV

2007

%


14121516NEGATIVE

68706864POSITIVE

AUG

2007

%

MAY

2007

%

FEB

2007

%

NOV

2006


Trends in past three months’ experience and current quarter expectations – Victoria

-11

30

19

+2

28

30

+18

3

21

+14

12

26

0

14

14

+7

26

33

NOV-

JAN

06/07%

-9

29

20

+5

26

31

+17

4

21

+5

16

21

-2

14

12

+12

26

38

AUG-

OCT

06%


-2-7+3+7+1-1+3-4NET BALANCE

2626242124272728DECREASE


+29+36+27+21+20+11+0+7NET BALANCE

1411131615273328DECREASE

4347403735383335INCREASEPROFITABILITY:

+27+35+23+26+21+24+18+15NET BALANCE

31113523DECREASE

3036242724292018INCREASEPRICES:

+26+21+20+22+22+10+12+12NET BALANCE

55688151011DECREASE

3126263030252223INCREASEWAGES BILL:

+6+18+11+11+150+7+7NET BALANCE

413321298DECREASE


+30+39+32+26+25+14+7+20NET BALANCE

1410121617253023DECREASE

4449444242393743INCREASESALES VALUE:

NOV-

JAN

07/08%

AUG-

OCT

07%

MAY-

JUL

07%

FEB-

APR

07%

NOV-

JAN

06/07%

AUG-

OCT

07%

MAY-

JUL

07%

FEB-

APR

07%


VICTORIA


-11

30

19

+2

28

30

+18

3

21

+14

12

26

0

14

14

+7

26

33

NOV-

JAN

06/07%

-9

29

20

+5

26

31

+17

4

21

+5

16

21

-2

14

12

+12

26

38

AUG-

OCT

06%


-2-7+3+7+1-1+3-4NET BALANCE

2626242124272728DECREASE


+29+36+27+21+20+11+0+7NET BALANCE

1411131615273328DECREASE


+27+35+23+26+21+24+18+15NET BALANCE

31113523DECREASE


+26+21+20+22+22+10+12+12NET BALANCE

55688151011DECREASE


+6+18+11+11+150+7+7NET BALANCE

413321298DECREASE


+30+39+32+26+25+14+7+20NET BALANCE

1410121617253023DECREASE


NOV-

JAN

07/08%

AUG-

OCT

07%

MAY-

JUL

07%

FEB-

APR

07%

NOV-

JAN

06/07%

AUG-

OCT

07%

MAY-

JUL

07%

FEB-

APR

07%


VICTORIA






Small and medium business outlook – Queensland- Queensland recorded a sharp decline in business confidence among SMEs this quarter, however, confidence was

significantly above the national average.

- SMEs in Queensland reported increased performance for wages and employment in the past quarter, however fallswere recorded for all other performance indicators.

- SMEs in Queensland reported the equal highest wages performance, along with Western Australia and the NorthernTerritory.

- SMEs in Queensland reported lower expectations for all indicators in the short term with the exception of capitalexpenditure where a marginal increase was expected.

- SME support for the Queensland Government rose during the past quarter to be the third highest of any state orterritory government.

+52

15

67

NOV2007

%


1012714NEGATIVE

77767469POSITIVE

AUG2007

%

MAY2007

%

FEB2007%

NOV2006%

CONFIDENCE IN OWN BUSINESS PROSPECT IN NEXT 12 MONTHS

Trends in past three months’ experience and current quarter expectations – Queensland

+52

15

67

NOV2007

%


1012714NEGATIVE

77767469POSITIVE

AUG2007

%

MAY2007

%

FEB2007%

NOV2006%


Trends in past three months’ experience and current quarter expectations – Queensland

-4

26

22

+17

2340

+24

3

27

+15

12

27

+6

8

14

+16

26

42

NOV-

JAN

06/07

%

-4

26

22

+14

2741

+24

4

28

+17

16

33

+6

12

18

+13

26

39

AUG-

OCT

06

%

* Net balance is defined as the difference between the percentage of small businesses reporting an increase and the percentage reporting a decrease.

0-1+9+5-10-4+5+0NET BALANCE

2223232731272228DECREASE


+23+39+35+30+23+17+22+15NET BALANCE

1811101318211926DECREASE4150454341384141INCREASEPROFITABILITY:

+27+30+29+32+24+21+24+21NET BALANCE

21423324DECREASE


+14+26+23+22+27+22+16+15NET BALANCE

11546791212DECREASE


+11+13+13+14+13+7+2+5NET BALANCE

53335141111DECREASE


+28+46+43+36+23+24+31+27NET BALANCE

16891218201721DECREASE


NOV-

JAN

07/08

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%

NOV-

JAN

06/07

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%


QUEENSLAND


-4

26

22

+17

2340

+24

3

27

+15

12

27

+6

8

14

+16

26

42

NOV-

JAN

06/07

%

-4

26

22

+14

2741

+24

4

28

+17

16

33

+6

12

18

+13

26

39

AUG-

OCT

06

%

* Net balance is defined as the difference between the percentage of small businesses reporting an increase and the percentage reporting a decrease.

0-1+9+5-10-4+5+0NET BALANCE

2223232731272228DECREASE


+23+39+35+30+23+17+22+15NET BALANCE


+27+30+29+32+24+21+24+21NET BALANCE

21423324DECREASE


+14+26+23+22+27+22+16+15NET BALANCE

11546791212DECREASE


+11+13+13+14+13+7+2+5NET BALANCE

53335141111DECREASE


+28+46+43+36+23+24+31+27NET BALANCE

16891218201721DECREASE


NOV-

JAN

07/08

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%

NOV-

JAN

06/07

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%


QUEENSLAND






Small and medium business outlook – South Australia- Business confidence fell during the quarter, however it was at levels above the national average.

- SMEs in South Australia recorded higher performance across every indicator in the last quarter, with the exception ofemployment and capital expenditure.

-

SMEs in South Australia recorded lower expectations for all indicators for the current quarter with the exception ofemployment, with SMEs expecting a marginal increase in this indicator.

- Despite this, SMEs in South Australia recorded the lowest expectations in employment for the year ahead of anystate or territory.

- SME support for the South Australian Government fell marginally during the quarter.

+47

21

68

NOV

2007

%


13121318NEGATIVE

65697365POSITIVE

AUG

2007

%

MAY

2007

%

FEB

2007

%

NOV

2006


Trends in past three months’ experience and current quarter expectations – South

Australia

+47

21

68

NOV

2007

%


13121318NEGATIVE

65697365POSITIVE

AUG

2007

%

MAY

2007

%

FEB

2007

%

NOV

2006


Trends in past three months’ experience and current quarter expectations – South

Australia

-3

26

23

+8

25

33

+29

2

31

+19

9

28

+7

10

17+11

23

34

NOV-

JAN

06/07

%

+1

22

23

+3

29

32

+22

5

27

+20

11

31

+10

8

18+9

27

36

AUG-

OCT

06

%

* Net balance is defined as the difference between the percentage of small businesses reporting an increase and the percentage reporting a decrease .

-9+6+0-4-10-3-2-5NET BALANCE

2818262329272423DECREASE


+29+37+14+27+20+11+9-1NET BALANCE

159211719272532DECREASE


+31+32+27+27+27+30+26+20NET BALANCE

41133334DECREASE


+24+26+16+18+25+17+10+18NET BALANCE

64677111312DECREASE


+9+8+8+3+8+6+9+0NET BALANCE

5257510611DECREASE


+33+41+21+33+29+16+5+3NET BALANCE

1110171518243235DECREASE


NOV-

JAN

07/08

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%

NOV-

JAN

06/07

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%


SOUTH AUSTRALIA


-3

26

23

+8

25

33

+29

2

31

+19

9

28

+7

10

17+11

23

34

NOV-

JAN

06/07

%

+1

22

23

+3

29

32

+22

5

27

+20

11

31

+10

8

18+9

27

36

AUG-

OCT

06

%

* Net balance is defined as the difference between the percentage of small businesses reporting an increase and the percentage reporting a decrease .

-9+6+0-4-10-3-2-5NET BALANCE

2818262329272423DECREASE


+29+37+14+27+20+11+9-1NET BALANCE

159211719272532DECREASE


+31+32+27+27+27+30+26+20NET BALANCE

41133334DECREASE


+24+26+16+18+25+17+10+18NET BALANCE

64677111312DECREASE


+9+8+8+3+8+6+9+0NET BALANCE

5257510611DECREASE


+33+41+21+33+29+16+5+3NET BALANCE

1110171518243235DECREASE


NOV-

JAN

07/08

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%

NOV-

JAN

06/07

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%


SOUTH AUSTRALIA






Small and medium business outlook – Western Australia- Business confidence recorded a large fall during the quarter, however, it was still the second highest of any state or

territory.

- SMEs in Western Australia reported the highest perceptions of the economy, increasing by 15 percentage points.

-

SMEs in Western Australia recorded the highest performance results for wages of any state or territory.- SMEs in Western Australia reported falling performance in all indicators in the past quarter.

- Western Australian SMEs reported increasing expectations for the coming quarter for employment, prices and capitalexpenditure.

- Western Australian SMEs recorded the highest expectations in employment for the coming quarter.

- Support for the Western Australian Government fell during the past quarter.

+61

12

73

NOV

2007

%


7866NEGATIVE

79808179POSITIVE

AUG

2007

%

MAY

2007

%

FEB

2007

%

NOV

2006


Trends in past three months’ experience and current quarter expectations – Western

Australia

+61

12

73

NOV

2007

%


7866NEGATIVE

79808179POSITIVE

AUG

2007

%

MAY

2007

%

FEB

2007

%

NOV

2006


Trends in past three months’ experience and current quarter expectations – Western

Australia

+3

22

25

+9

24

33

+2 61

27

+1 4

12

26

+4

13

17

+1 9

22

41

NOV-JAN

06/07%

-17

35

18

+5

28

33

+2 06

26

+1 9

9

28

+5

12

17

+6

32

38

AUG-OC T06%


+1 1+9-11+2-1+7+0-14NET BALANCE

2427362726233036DECREASE


+4 8+3 6+1 8+2 3+3 7+1 0-3+8NET BALANCE

711151612263225DECREASE


+2 3+3 2+2 6+2 3+2 5+3 1+2 0+2 1NET BALANCE01354123DECREASE


+2 5+1 7+1 4+1 8+1 8+1 6+9+1 6NET BALANCE

5999681513DECREASE


+1 6+1 2+5+1 0+8+9+0+5NET BALANCE

344558159DECREASE


+5 5+3 6+1 9+2 1+3 6+2 3-1+1 1NET BALANCE

510171614203425DECREASE


NOV-JAN

07/08%

AUG-OC T07%

MAY-JUL07%

FEB-AP R07%

NOV-JAN

06/07%

AUG-OC T07%

MAY-JUL07%

FEB-AP R07%

TOTAL SMALL AND MEDIUM BUSINESS –TASMANIA


+3

22

25

+9

24

33

+2 61

27

+1 4

12

26

+4

13

17

+1 9

22

41

NOV-JAN

06/07%

-17

35

18

+5

28

33

+2 06

26

+1 9

9

28

+5

12

17

+6

32

38

AUG-OC T06%


+1 1+9-11+2-1+7+0-14NET BALANCE

2427362726233036DECREASE


+4 8+3 6+1 8+2 3+3 7+1 0-3+8NET BALANCE

711151612263225DECREASE


+2 3+3 2+2 6+2 3+2 5+3 1+2 0+2 1NET BALANCE01354123DECREASE


+2 5+1 7+1 4+1 8+1 8+1 6+9+1 6NET BALANCE

5999681513DECREASE


+1 6+1 2+5+1 0+8+9+0+5NET BALANCE

344558159DECREASE


+5 5+3 6+1 9+2 1+3 6+2 3-1+1 1NET BALANCE

510171614203425DECREASE


NOV-JAN

07/08%

AUG-OC T07%

MAY-JUL07%

FEB-AP R07%

NOV-JAN

06/07%

AUG-OC T07%

MAY-JUL07%

FEB-AP R07%

TOTAL SMALL AND MEDIUM BUSINESS –TASMANIA






Small and medium business outlook – Tasmania- Business confidence in Tasmania fell during the quarter but remained above average.

- Bucking the national trend, which saw most SMEs report weak performance over the past quarter, SMEs in Tasmaniareported solid gains in all performance indicators.

- Tasmanian SMEs reported the highest performance for prices of any state or territory.

- Expectations for the current quarter were for increases in all indicators, with the exception of prices.

- Tasmanian SMEs reported the highest expectations for the coming quarter of any state or territory for sales,profitability and capital expenditure.

- Support for the Tasmanian Government’s policies was unchanged during the past quarter.

+54

14

68

NOV2007

%


95814NEGATIVE

69747867POSITIVE

AUG2007

%

MAY2007

%

FEB2007

%

NOV2006

%


Trends in past three months’ experience and current quarter expectations – Tasmania

+54

14

68

NOV2007

%


95814NEGATIVE

69747867POSITIVE

AUG2007

%

MAY2007

%

FEB2007

%

NOV2006

%


Trends in past three months’ experience and current quarter expectations – Tasmania

+3

22

25

+9

24

33

+26

1

27

+14

12

26

+4

13

17

+19

22

41

NOV-

JAN

06/07

%

-17

35

18

+5

28

33

+20

6

26

+19

9

28

+5

12

17

+6

32

38

AUG-

OCT

06

%


+11+9-11+2-1+7+0-14NET BALANCE

2427362726233036DECREASE


+48+36+18+23+37+10-3+8NET BALANCE

711151612263225DECREASE


+23+32+26+23+25+31+20+21NET BALANCE

01354123DECREASE


+25+17+14+18+18+16+9+16NET BALANCE

5999681513DECREASE


+16+12+5+10+8+9+0+5NET BALANCE

344558159DECREASE


+55+36+19+21+36+23-1+11NET BALANCE

510171614203425DECREASE


NOV-

JAN

07/08

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%

NOV-

JAN

06/07

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%


TASMANIA


+3

22

25

+9

24

33

+26

1

27

+14

12

26

+4

13

17

+19

22

41

NOV-

JAN

06/07

%

-17

35

18

+5

28

33

+20

6

26

+19

9

28

+5

12

17

+6

32

38

AUG-

OCT

06

%


+11+9-11+2-1+7+0-14NET BALANCE

2427362726233036DECREASE


+48+36+18+23+37+10-3+8NET BALANCE

711151612263225DECREASE


+23+32+26+23+25+31+20+21NET BALANCE

01354123DECREASE


+25+17+14+18+18+16+9+16NET BALANCE

5999681513DECREASE


+16+12+5+10+8+9+0+5NET BALANCE

344558159DECREASE


+55+36+19+21+36+23-1+11NET BALANCE

510171614203425DECREASE


NOV-

JAN

07/08

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%

NOV-

JAN

06/07

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%


TASMANIA






Small and medium business outlook – Northern Territory- The Northern Territory was the only state or territory to record a rise in SME confidence in the past quarter, with

confidence also the highest of any state or territory.

- SMEs in the Northern Territory were the most likely to report having difficulties finding quality staff.

-

SMEs in the Northern Territory recorded the highest performance of any state or territory in the past quarter in sales,employment, wages, profitability and capital expenditure.

- Despite having anticipated falls, the only performance indicator to drop over the past quarter in the NorthernTerritory was wages, which recorded a marginal decline.

- Anticipating the coming wet season, SMEs in the Territory were expecting falls in all indicators with the exception ofcapital expenditure where a marginal increase was anticipated. Expectations for sales, employment, wages, pricesand capital expenditure were the lowest of any state or territory for the coming quarter.

- Support for the Northern Territory Government rose sharply during the quarter to be the most supported state orterritory government by SMEs.

+71

7

78

NOV

2007

%


7111113NEGATIVE

75747971POSITIVE

AUG

2007

%

MAY

2007

%

FEB

2007

%

NOV

2006


Trends in past three months’ experience and current quarter expectations – NorthernTerritory

+71

7

78

NOV

2007

%


7111113NEGATIVE

75747971POSITIVE

AUG

2007

%

MAY

2007

%

FEB

2007

%

NOV

2006


Trends in past three months’ experience and current quarter expectations – NorthernTerritory

0

26

26

+8

25

33

+27

3

30

+2411

35

-1

18

17

+10

27

37

NOV-JAN

06/07

%

0

30

30

+23

21

44

+29

5

34

+209

29

+2

15

17

+30

18

48

AUG-OCT

06

%


-10-11+5+11-4+9-6-2NET BALANCE

3033302030163227DECREASE


+16+36+47+39+6+29+27+20NET BALANCE

1111131225141322DECREASE


+23+32+27+36+35+26+25+35NET BALANCE

31101210DECREASE


+12+17+28+19+10+22+23+27NET BALANCE8949134109DECREASE


+3+12+17+21+6+19+1+14NET BALANCE

9421117149DECREASE


+14+36+54+43+5+34+43+25NET BALANCE

191061027131120DECREASE


NOV-JAN

07/08

%

AUG-OCT

07

%

MAY-JUL

07

%

FEB-APR

07

%

NOV-JAN

06/07

%

AUG-OCT

07

%

MAY-JUL

07

%

FEB-APR

07

%


NORTHERN TERRITORY


0

26

26

+8

25

33

+27

3

30

+2411

35

-1

18

17

+10

27

37

NOV-JAN

06/07

%

0

30

30

+23

21

44

+29

5

34

+209

29

+2

15

17

+30

18

48

AUG-OCT

06

%


-10-11+5+11-4+9-6-2NET BALANCE

3033302030163227DECREASE


+16+36+47+39+6+29+27+20NET BALANCE

1111131225141322DECREASE


+23+32+27+36+35+26+25+35NET BALANCE

31101210DECREASE


+12+17+28+19+10+22+23+27NET BALANCE8949134109DECREASE


+3+12+17+21+6+19+1+14NET BALANCE

9421117149DECREASE


+14+36+54+43+5+34+43+25NET BALANCE

191061027131120DECREASE


NOV-JAN

07/08

%

AUG-OCT

07

%

MAY-JUL

07

%

FEB-APR

07

%

NOV-JAN

06/07

%

AUG-OCT

07

%

MAY-JUL

07

%

FEB-APR

07

%


NORTHERN TERRITORY






Small and medium business outlook – Australian CapitalTerritory- Business confidence was unchanged during the quarter among Australian Capital Territory SMEs, recording the third

highest result of any state or territory.

- All performance indicators fell during the quarter in the Australian Capital Territory, with the exception of prices.

- Wages and capital expenditure performance were lowest among Australian Capital Territory SMEs.

- SMEs in the Australian Capital Territory were expecting increases in wages and prices in the current quarter, posing arisk to the inflationary environment in the Territory.

- Support for the Australian Capital Territory Government fell during the quarter.

+55

14

69

NOV2007

%


11121212NEGATIVE

67697367POSITIVE

AUG2007

%

MAY2007

%

FEB2007

%

NOV2006


Trends in past three months’ experience and current quarter expectations – AustralianCapital Territory

+55

14

69

NOV2007

%


11121212NEGATIVE

67697367POSITIVE

AUG2007

%

MAY2007

%

FEB2007

%

NOV2006


Trends in past three months’ experience and current quarter expectations – AustralianCapital Territory

+2

28

30

+21

2344

+19

6

25

+24

16

40

+7

13

20

+22

24

46

NOV-

JAN

06/07

%

-2

26

24

+21

2041

+25

6

31

+13

12

25

-5

14

9

+28

22

50

AUG-

OCT

06

%


-8-9-17-1-13-12+5-6NET BALANCE

2533332935302334DECREASE


+28+39+32+37+31+6+16+20NET BALANCE


+32+22+24+21+29+26+22+13NET BALANCE

34123245DECREASE


+20+18+27+18+24+4+18+15NET BALANCE

8103117181515DECREASE


+10+19+19+14+13+1+11+7NET BALANCE

36155131013DECREASE


+25+42+38+32+32+7+22+28NET BALANCE

2012121612322424DECREASE


NOV-

JAN

07/08

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%

NOV-

JAN

06/07

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%


AUSTRALIAN CAPITAL TERRITORY


+2

28

30

+21

2344

+19

6

25

+24

16

40

+7

13

20

+22

24

46

NOV-

JAN

06/07

%

-2

26

24

+21

2041

+25

6

31

+13

12

25

-5

14

9

+28

22

50

AUG-

OCT

06

%


-8-9-17-1-13-12+5-6NET BALANCE

2533332935302334DECREASE


+28+39+32+37+31+6+16+20NET BALANCE


+32+22+24+21+29+26+22+13NET BALANCE

34123245DECREASE


+20+18+27+18+24+4+18+15NET BALANCE

8103117181515DECREASE


+10+19+19+14+13+1+11+7NET BALANCE

36155131013DECREASE


+25+42+38+32+32+7+22+28NET BALANCE

2012121612322424DECREASE


NOV-

JAN

07/08

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%

NOV-

JAN

06/07

%

AUG-

OCT

07

%

MAY-

JUL

07

%

FEB-

APR

07

%


AUSTRALIAN CAPITAL TERRITORY




How to obtain a copy of the Sensis® Business Index

Internet

The Sensis® Business Index reports are updated each quarter. Electronic copies of the reports can be accessed on the Sensiswebsite at: www.about.sensis.com.au.

Sensis® Business Index “Special Reports”

Since the inception of the Sensis® Business Index , a range of Special Reports have been produced. Major reports include:

Sensis® Environment Report – September 2007 Teleworking - June 2005 E-Business: The online experience of Australian SMEs – Annually 1995 to August 2005

Innovation – March 2001 Finance & Banking Issues – August 1993, August 1995 and November 1999 Attitudes to Changes in FBT – July 1999 Workers Compensation and Workplace Safety – November 1998 The Paper Work Burden on Small Business – October 1996 Women in Business – July 1994 and February 1996 Attitudes to Government – October 1994 and November 1995

Sensis® Marke Intelligence products include commissioned research for corporate and government organisations on a varietyof SME-based and other issues.

t

For further information please contact: Christena SinghAuthor, Sensis® Business Index Sensis Pty LtdPh: (03) 8653 4896

[email protected]

About Sensis:

Sensis is Australia's leading information resource. We make complex lives simpler by helping Australians find, buy and sell.Sensis delivers innovative and integrated search solutions via print, online, voice and wireless channels to connect Australians

24 hours a day, seven days a week. Our powerful, multi-channel portfolio provides an unparalleled local information sourceincorporating: the White Pages®, Yellow™ and Yellow Pages® directories; the Citysearch® lifestyle site; the Whereis® locationand navigation database; sensis.com.au - the search engine for Australians; Sensis 1234, the operator-assisted, premium voiceinformation service; and The Trading Post Group’s stable of weekly and monthly publications and Universal Publisher’s mappingpublications; and GoStay®. Sensis also manages LinkMe.com.au, an innovative online career networking site, in partnershipwith MBI Investments. Sensis also recently announced a majority shareholding in SouFun.com, China’s leading real estate andhome furnishings website.

® and ™ Registered trademark and trademark of Telstra Corporation Ltd. UBD®, the UBD logo and Gregory’s logo are registeredtrade marks of Universal Publishers Pty Ltd. Trading Post™ is a trade mark of Research Resources Pty Ltd. Citysearch® is aregistered trade mark of CitySearch Australia Pty Ltd. Sensis Pty Ltd is responsible for Yellow Pages®, White Pages® andWhereis® and related products and services on behalf of Telstra Corporation Ltd and is responsible for similar activities inrelation to CitySearch® on behalf of CitySearch Australia Pty Ltd and CitySearch Canberra Pty Ltd.

mailto:[email protected]

mailto:[email protected]

Documents

November2007SensisBusinessIndex