Australian entrepreneurial spirits stay up despite crisis

By Sara Rich The Australian
AUSTRALIAN entrepreneurs are some of the most optimistic in the world, surpassing the US, Japan and Britain for their positive outlook on the year ahead, a survey has shown.

The 2009 Grant Thornton International Business Report found that despite the global financial crisis, 46 per cent of privately held businesses in Australia were bullish on the domestic economy, The Australian reports.

This places the nation as the 10th most optimistic economy in the report, well ahead of the US (22nd), Britain (27th) and Japan, the most pessimistic nation in the 36-country study.

India has the most optimistic business owners, with the emerging economy scoring an optimism rating of 83 per cent, compared to the global average of -16 per cent.

In Australia, 80 per cent of entrepreneurs believe their turnover will increase this year, or at the very least stay the same, with two-thirds expecting to achieve similar or higher profits to 2008.

In light of this positive outlook, 39 per cent planned to increase investment in plants and machinery this year.

Grant Thornton Australia national head of privately held business Tony Markwell said entrepreneurs had an advantage over listed companies in times of commercial stress.

"They can move quickly and decisively to exploit changing economic conditions because they're smaller and have fewer stakeholders.

"Defensive action in the short term may be necessary, but we're telling our clients to hold their nerve and get a strategic plan in place for what could be a very productive new marketplace.''

But Australia's optimism rating of 11 per cent is less than a sixth of that at the same time last year. Optimism around the world has slumped by 56 per cent in the past 12 months.

"Last year two-thirds of businesses across Australia told us they were positive about the 12 months ahead of them, now that figure has fallen to just under half nationally, and to a third in NSW and Queensland,'' Mr Markwell said.

"With such an unprecedented pressure on the marketplace, it's inevitable that firms will be feeling the strain, but the right attitude is critical in weathering the storm.

"Sound business planning and financial management, alongside ongoing support from government, should help businesses steer a steady path through the next 12 months.''