Small business sales deliver strong start for 2012, with the mining states fueling growth
ANZ today released its monthly Small Business Sales Trends report which showed small business sales increased by 7.5% year on year (y/y) in January 2012. Overall small business growth has now been positive since May 2011.
Retail-related small business sales remain flat with sales growth this month of just 3.4% y/y. Clothing and fashion outlets and homewares and furniture stores continue to experience difficult conditions with sales for 2011 as a whole, down 2.8% and 1.1% respectively.
Small Business Sales Trends – Highlights
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Commenting on this month’s result, ANZ General Manager Small Business Nick Reade said: “The year has started out on a positive note for Australian small businesses, with growth up 7.5% for the month. Overall small business sales have now been positive since May 2011, which is an encouraging sign for the sector.
“The major mining states of Queensland, Western Australia and the Northern Territory, seem to be fuelling this growth, with sales up 9.8%, 8.8%, and 8.0% y/y respectively. Although, Queensland’s high annual growth rate is probably slightly inflated by the low level of sales during the floods at this time last year.
“In the other states, small business sales growth in NSW and Victoria improved in January, but remain weaker than in the mining-based states.
“Impressive sales increases were also seen in most of the non-retail industries, with automotive up 13% and restaurants up 13.4%, retail-related small businesses are still feeling the pinch of consumer caution.
“The critical issue for small businesses this year will be to maintain these growth levels as best they can. Particularly for the small businesses that aren’t directly related to the mining sector which is growing strongly, they’ll need to stay lean, agile and customer focused so that they can remain strong and profitable into the year,” Mr Reade said.
Commenting further on the data, ANZ Senior Economist, Julie Toth said: “January’s sales might be starting to show the benefits of two interest rate cuts in November and December 2011. The pick up in small business sales in January is also consistent with a range of other indicators that are pointing to a promising start to 2012, including the recent solid rise in the ANZ job advertisement series.
“Beneath the overall improvement, we are still seeing a large gap between retail-related small businesses compared with the non retail and services. Automotive and business services remain the best performers among non-retail, with growth up 13% and 16.9% respectively.
“Looking ahead, we expect this mixed pattern of growth to continue through 2012 as the increased mining activity increasingly dominates Australia’s growth profile.
The data is based on the value of credit, debit and Eftpos transactions processed through ANZ merchant terminals and all ANZ card transactions processed through other systems for businesses at least two years old with annual turnover less than $5 million. ANZ has approximately 20% market share of all card transactions.