Business

Aussie businesses slashing jobs and transforming to survive pandemic

Aussie businesses slashing jobs and transforming to survive pandemic
Small Australian businesses are slashing jobs at an alarming rate and majority fear for how they'll make money in the future, a new survey has revealed.
Some businesses are believed to have been wiped out entirely by the coronavirus pandemic while others fight to find bold new ways to transform in order to survive.
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Almost one-third of Australian small and medium sized businesses have had to cut jobs and 66 per cent said sales were lower in May this year compared to the same month last year. (Getty Images/iStockphoto)
A report released today by Facebook, the OECD and the World Bank shows almost 60 per cent of small Australian businesses now believe future cashflow for their companies will present a problem.
Almost one-third have had to cut jobs and 66 per cent said their sales were lower in May this year compared to the same month last year.
The report surveyed 30,000 business leaders in 50 countries, with at least 351 Australians taking part.
Almost 60 per cent of Australian SMBs said future cashflow looks to present a problem following the COVID-19 pandemic period. (9News)
The struggle has protracted for upwards of seven months for some businesses across Australia that were already struggling with bushfires and drought before the pandemic.
Jason Eades, the CEO of Aboriginal and Torres Strait Islander travel marketplace Welcome to Country, said cashflow had entirely dried up for some when international tourism was cut-off to stem the spread of COVID-19.
"Some businesses won't open this year," he told 9News.
"The cost of opening with such a small window to engage with travellers is not worth the effort to do so.
More than half of the small businesses surveyed said they were optimistic about the future despite their profit losses. (Nine)
"It's been devastating on tourism. There's no other way to say it. It doesn't matter if it's an Aboriginal business or non-Aboriginal business working in tourism, they've all been hit hard."
Despite the pain, businesses are discovering new audiences and ways to stay engaged with existing ones through online platforms.
Melinda Petrunoff, Facebook's head of small business for Australia and New Zealand, told 9News many businesses were rapidly converting their services to online to maintain income and diversify their customer base.
Indigenous travel marketplace business 'Welcome to country' has been working with travel businesses to showcase them with Facebook Live during the pandemic. Pictured: Lirrwi Tourism, Arnhem Land, Northern Territory. (Supplied - Tourism Australia)
More than half of the small businesses surveyed said they were optimistic about the future despite their profit losses, and at least 43 per cent said a quarter of their earnings came from digital sales in May.
"Whilst cashflow is a concern, what we're seeing is Australian businesses are definitely being resilient and they're transforming quickly to be able to stay in contact and keep their businesses alive," Ms Petrunoff said.
"We've seen a huge increase in tools such as Facebook Live, Instagram TV used by small businesses to be able to connect to their customers — it's been quite extraordinary.
"They're managing to digitally transform faster than they have ever before."
During the pandemic the social media giant launched the Boost with Facebook Australia program, free training for small businesses to help them promote products online.
Despite the pain, businesses are discovering new audiences and ways to stay engaged with existing ones through online platforms. (Fairfax Media)
Welcome to Country has been working with Indigenous travel businesses to showcase them with Facebook Live during the pandemic.
"Prior to Easter when we were engaging with businesses to check in to see how they were coping, managers didn't know what all this meant," Mr Eades said.
"I don't think anybody coming into this pandemic knew anything in terms of how long, what does this actually mean, what do we do.
"It's an overwhelming kind of period not knowing what's next or how long do you have to weather this before you see some change. Many have started to realise that it may be a while off before things change and so working out what they do next."
During the pandemic social media giant Facebook launched the Boost with Facebook Australia program, free training for small businesses to help them promote products online. (Associated Press)
Mr Eades expects tourism businesses to bounce back and said it had been "amazing to watch how quickly people reach out to one another to support each other" during the pandemic.
A result of COVID-19 in the future will be some businesses potentially restructuring to make themselves less vulnerable to another similar disaster.
"(But) there's some things that don't change and that's that spirit of just getting on with things and the resilience that we're known for. I'd like to think that those things will definitely survive."
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