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Australia's Excellent Climate for Buying and Selling Businesses
People looking to buy a business will find that Australia’s strong economy, technological investment and government initiatives offer them fertile ground to continue to grow their new enterprise. For those getting ready to sell, the same benefits continue to bring new buyers into the market.
In 2017, NAB released Moments That Matter: Understanding Australian Small to Medium Businesses with results from owners and decision-makers of Australian small and medium-size enterprises (SMEs). Those results were encouraging.
Australian SMEs feel successful and confident in their future, with one in ten actively growing their business and nearly half aiming to expand within the next five years.
Economy and Trade
Australia has had 26 consecutive years of economic growth. The economy weathered the Global Financial Crisis, managing to grow when other developed economies went into recession. Small and medium-size businesses remain the backbone of this growth, contributing 57 per cent of Australia’s GDP and employing around 70 per cent of Australia’s workforce.
Australia’s economy allows for strong trade agreements, which also benefit small businesses. The most well-known new trade agreement is the Trans-Pacific Partnership (TPP-11), which will open new markets, cut red tape and reduce tariffs for Australian businesses and those in the ten other signatory countries. These benefits will be felt by providers of both goods and services and will open up opportunities for Australian businesses to bid for government procurement services in some member countries.
Small businesses are often at the forefront of innovation as they look for ways to compete with larger enterprises. Australia encourages this through programs such as the National Innovation and Science Agenda, which provides funding to support new technology. In particular, NISA aims to support businesses that are creating technological innovations through grants, tax breaks and opportunities to do business with the government.
The Australian Government has also been investing in technology infrastructure. The National Broadband Network continues to bring high-speed internet to Australians, allowing businesses to reach new customers online, both in Australia and globally. More and more Australian businesses are situated entirely online, especially among Millennials. Online enterprises allow new business owners to get started and test products for a relatively small outlay.
The Australian Government has also taken steps to support the growth of small and medium-size businesses. The small business turnover threshold was recently increased to $10 million, giving more than 90,000 businesses access to the small business tax concessions, including new tax cuts for SMEs. As small businesses grow, they can take advantage of job creation initiatives that provide bonuses for hiring young or unemployed workers.
The government has also invested in red tape reduction, reducing compliance costs and increasing cash flow for small businesses. Every step that makes it easier to do business in Australia makes buying a business more attractive to Australians.
Australia’s strong economy encourages small businesses. Support including government initiatives, technological infrastructure and strong free-trade agreements make this the perfect time to buy a business in Australia and begin building a valuable asset. The same strengths make it a great time to sell, because buyers will be more confident and ready to invest.
For further information, contact your nearest LINK Business Broking Office.