Small business guide to surviving the last quarter of 2022

Tamara Oppen, Managing Director at GoDaddy Australia shares the top impacts on Aussie small businesses as we head into the final (and busiest) quarter of the year.

The clock is counting down on 2022 and another testing year for Australian small businesses. But we’re not done yet.

With the quarter ahead comes the Federal Budget, our biggest shopping season and a bumpy northern hemisphere winter that may well decide if we enter a global recession.

Here’s your guide to help navigate the business outlook for the final sprint to the finish line of 2022.

25 October – the Federal Budget

The Federal Labor Government handed down its first budget on 25 October with Treasurer Jim Chalmers already laying the groundwork for some disappointment ahead.

In a pre-budget speech earlier this month, the Treasurer said there would be “difficult decisions for difficult times” as the economy labours under the strain of a gloomy global outlook.

Chalmers has set the scene for “affordable, responsible, sustainable spending” that is both fair and future-focused.

Chalmers says there will be cost of living relief in the budget through cheaper childcare and medicines and the Government will increase its investment in skills and training as well as supporting pay rises in the ‘care economy’.

Look out for: small business tax boost for digital and education spending

The previous Federal Government announced in the May budget that it would introduce tax breaks for small businesses to invest in extra staff training and digital technology.

Last month, the Albanese Government confirmed it would support the initiatives and released draft legislation to bring the tax breaks into law.

Under the plan, the $1.5 billion Technology Investment Boost and the Skills and Training Boost will be available to small businesses with an annual turnover of less than $50 million.

They will be able to claim a bonus 20 per cent deduction for eligible expenditure on digital technology and external training for employees. Digital technology can include digital media and marketing, eCommerce and software, systems and services.

The tax breaks will be backdated, meaning expenditure incurred back to 29 March 2022 will be eligible.

The Government says it hopes to introduce the legislation into Parliament this year.

Keep an eye on: key economic indicators

The Reserve Bank of Australia has made it clear it’s not done with interest rate rises yet.

Interest rates rose for the sixth consecutive month in a row in October, with the cash rate now 2.6 per cent.

It’s keeping an eagle eye on the rate of inflation, which currently sits at 6.1 per cent, saying it wants to get that figure down to between two and three per cent.

The unemployment rate is currently sitting at 3.5 per cent, which is reflecting the difficulties many small businesses are having in hiring staff.

In addition, the Treasury has downgraded its forecast for global growth by 0.75 per cent this year, one per cent next year and half a percent in 2024.

International Monetary Fund chief, Kristalina Georgieva, warned earlier this month the global economy was undergoing a “fundamental shift” with greater uncertainty, higher economic volatility, natural disasters and geopolitical tensions.

Get ready for: Shopping season with Black Friday

Despite the economic challenges, Australians are carrying on with retail spending and the year’s biggest shopping season is just around the corner. Small businesses have an opportunity to get their business and digital presence ready to take advantage of the shopping season, by updating their website, online store and digital marketing to let their customers know they are ready for business.

The Australian Bureau of Statistics said retail sales were up 0.6 per cent in August, the eighth consecutive increase this year, and the industry is gearing up for Black Friday on 25 November and the holiday shopping season shortly after.

Australia Post figures revealed online sales events continue to drive spending with Afterpay Day in August driving a 7.3 per cent week-on-week growth in online purchases.

Australia Post is also predicting a surge in online shopping towards the end of the year, with the news last month it was recruiting an additional 6,000 people to keep up with the seasonal shopping surge.

The holiday period ahead and the economic events that lead up to it presents both an instructive and opportunistic time for small businesses, and will set the stage for the start of 2023.

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