It’s been roughly a month since the Government’s JobKeeper scheme concluded. Treasury Department estimates forecast that the end of the scheme – crucial in keeping thousands of businesses financially afloat in 2020 – could threaten as many as 150,000 jobs. So could its conclusion and uncertainty over what happens next lead to a surge in entrepreneurialism?
It’s popular theory that entrepreneurialism and innovation thrive during periods of economic instability, with the likes of Airbnb, Square, Uber and WhatsApp – industry-leaders today – born during the 2008/9 financial crisis. According to data from the Australian Securities and Investments Commission (ASICs), business registrations in 2020 increased 5.72% YoY compared to 2019. What’s more, GoDaddy’s Project Resolution research found that 33 percent of Australian respondents are considering starting their own business in 2021.
But what might that mean in the retail industry, what role do small retail businesses play in our long-term economic recovery and why is Australia a birthplace for so many entrepreneurs and innovators?
Retail in the new normal
GoDaddy’s research, which sought to investigate job satisfaction and entrepreneurial intentions, found that retail was the most popular industry for budding Australian entrepreneurs. Of those considering starting a business this year, 14 percent said they would do so in retail. That’s almost double the next most popular industries: creative and professional services, and cafes and restaurants (all eight percent). This figure is perhaps unsurprising considering the potential for retailers who embrace digital transformation.
Today, consumers are increasingly digital-first, using online channels to research and engage with brands. Australia saw huge growth in online sales in 2020 according to Australia Post figures as more consumers shopped online. Today’s shoppers expect to buy what they want, when and where they want it. Technology is helping to level the playing field, making it easier for small businesses to build websites and eCommerce stores, implement engaging digital marketing strategies and meet the changing needs of their customers. Getting started in online retail has never been easier and smart entrepreneurs are taking advantage of this.
SMBs in Australia’s post-pandemic recovery
Small businesses (SMBs) are the engine room of our economy, making up 97 percent of all businesses in Australia, and contributing 32 percent of total GDP. They’re family-run retailers in rural Tasmania, they’re creative freelancers in Melbourne, and they’re Sydney startups with bright visions of becoming the next Atlassian or Canva.
Australia’s economic recovery has been widely commended. Earlier this month the International Monetary Fund (IMF) confirmed the nation had outperformed all major advanced economies over the past year, forecasting further growth of 4.5 percent in 2021. Many factors contributed to this short-term recovery, and many factors will contribute to continued growth over the medium- to long-term. One of those factors, is a 2.3-million strong cohort of entrepreneurial Australian small businesses pursuing a passion and contributing to the economy.
Their impact is not only economically, but socially too. Small businesses are often the glue that holds together communities across Australia. They’re the local cafe where families and friends come together, the highstreet retailer that provides the first employment to many young Australians and the local builder who delivers essential services across the community. After an unprecedented 12 months that tested global resolve and isolated loved ones, their ability to bring people back together cannot and should not be underestimated.
Australia: A fertile land for entrepreneurialism
Australia has long been considered a nation of small businesses. There are many reasons, and 2.3 million Australians are taking advantage of them to run their own business. For example, registering a small business is relatively straightforward, the economy is resilient and growing, and it’s never been easier or more affordable for businesses to get online.
What’s more, and perhaps most importantly, there’s an overwhelming support and appetite for small businesses. Australia is a proud country and the ‘support local’ sentiment is strong. Initiatives like #BuyFromTheBush, #ClickforVic and GoDaddy’s #OpenWeStand, have provided invaluable exposure to local businesses, encouraging Aussies to spend their money where it can make a difference: locally.
The end of JobKeeper will undoubtedly be daunting for many businesses. But, behind the nation’s strong economic recovery, a proud and supportive audience and advances in technology, who is to say there can’t there be a wave of innovation and entrepreneurialism to help drive Australia forward?
Tamara Oppen is managing director at GoDaddy Australia.