New South Wales businesses are expecting a decrease in trade compared to 2022 levels, a new report outlines.

The 24-page document released by business advocacy body, Business NSW reveals the results of its latest quarterly Business Conditions Survey. The survey sought to measure business confidence amongst businesses in different regions across the state.

Considering 845 responses submitted between October 29 and November 13 2023, it found that Christmas trading is expected to fall on average 11 per cent this year compared to last year. Businesses in the Hunter Valley, and Far West and Orana regions are anticipating a decline in excess of 20 per cent. It was also noted that while some businesses anticipate an increase in trade this year, no region on average is expecting an increase.

Retail Trade, and Arts and Recreation Services – two industries beauty salon services are believed to fall under – were identified as those known to heavily rely on Christmas trade (in conjunction with Accomodation and Food Services). In Sydney, business owners are expecting a 4 per cent downturn on trade year-on-year. Their regional counterparts are expecting a sharper decline of 13 per cent on average.

The report flagged a number of key factors driving this lack of confidence. These include (but are not limited to): the impact of rising interest rates, concerns around the costs of running a business and energy usage costs. “The costs of insurance, energy and interest rates are out of control and have collectively eroded what would have been previously, healthy profit margins,” one respondent from the Illawarra Arts and Recreation sector quoted.

The report also identified various barriers business owners face in a) their hopes for expansion, and b) investing in productivity. It was found the largest barrier to doing business is the cost of doing business, not only restricting businesses from achieving higher profit growth but also hampering ambitions for expansion. 68 per cent of respondents indicated that they had invested in staff training in the last 12 months in order to boost productivity.

When it comes to hiring intentions for the next three months, respondents in the NSW Riverina, Coffs Harbour – Grafton, and Far West and Orana regions are most likely to hire additional staff across the board.

Business NSW is the peak business organisation for New South Wales representing the needs of 48,000 businesses across the state. It aims to maximise the outcomes and potential of Australian businesses, including small, medium and large enterprises.

To read the report in full, visit this link.

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