Exceeding Business 2025. All rights reserved

The Australian economic environment in 2025 presents both challenges and opportunities for small businesses. Staying informed is crucial for making sound decisions and ensuring sustainable growth. Here’s a snapshot of key trends and potential support to help you navigate the current climate:

Key Economic Trends to Be Aware Of:

• Fluctuating Australian Dollar: The Aussie dollar has seen some movement, recently dropping. A weaker dollar can increase costs for businesses importing goods but may benefit exporters and encourage local consumer spending. Keep an eye on exchange rates if your business involves international transactions.
  • Example: If you import materials, consider hedging strategies or exploring local suppliers. If you export, explore new international markets.

• Global Tariffs and Supply Chains: New tariffs internationally can disrupt supply chains, potentially leading to higher prices and delays for imported goods. Businesses relying on international suppliers, particularly from Asia, should assess their supply chain resilience.
  • Action: Diversify your supplier base or explore domestic alternatives to mitigate risks.

• Potential Interest Rate Cuts: The Reserve Bank of Australia (RBA) is expected to consider interest rate cuts throughout the remainder of 2025 due to slowing economic growth. Lower interest rates could ease loan repayments and potentially stimulate consumer spending.
  • Consider: Review your existing loans and explore opportunities for investment or expansion if interest rates decrease.

• Persistent Cost of Doing Business: While overall inflation is easing, the cost of running a business remains high, with rising expenses in areas like wages, energy, and some supply chain components. Maintaining profitability requires careful cost management and pricing strategies.
  • Tip: Regularly review your expenses and identify areas for potential savings. Consider the value you provide to customers when setting prices.

• "Buy Australian" Campaign: The government is actively encouraging Australians to buy locally produced goods and services with a dedicated campaign. Small businesses can leverage this sentiment by highlighting their local connections and Australian-made products.
  • Strategy: Clearly communicate your Australian origins through branding, marketing, and even participating in local "buy local" initiatives.

Government Support and Initiatives:

The Australian government offers various programs and initiatives aimed at supporting small businesses. Here are some key areas and recent developments:

• Energy Bill Relief: Eligible small businesses may receive a one-off credit (e.g., $150) towards their electricity bills. This is often applied automatically by the provider.
  • Check: Review your energy bills to ensure this credit has been applied if you are eligible.

• Energy Efficiency Grants: Grants of up to $25,000 are available to help small and medium businesses invest in energy-efficient upgrades.
  • Explore: Investigate if your business could benefit from upgrading appliances or improving insulation to reduce energy costs and potentially access these grants.

• Cyber Security Support: Several programs exist to help small businesses improve their cybersecurity, including online training and resilience services.
  • Action: Utilize resources like the Cyber Wardens program or the Small Business Cyber Resilience Service to protect your business from online threats.

• "Buy Australian" Procurement: Government procurement rules are being updated to increase opportunities for small and medium-sized enterprises to win government contracts.
  • Consider: If your business can supply goods or services to the government, research these updated rules and register on relevant procurement platforms.

• Support for Apprentices: Businesses employing apprentices in priority occupations, particularly in housing construction, may be eligible for increased incentive payments.
  • If applicable: Look into the Priority Hiring Incentive if you are in the construction industry and employ apprentices.

• Mental Health and Financial Wellbeing Support: Programs like NewAccess for Small Business Owners and the Small Business Debt Helpline offer crucial support for business owners facing mental health challenges or financial difficulties.
  • Remember: It's important to seek help if you are struggling. These services are available to provide confidential support.

• Grants and Funding Programs: Various grants are available at both federal and state levels for different purposes, including business setup, innovation, expansion, and export activities.
  • Research: Utilize grant finder tools (like the one mentioned on business.gov.au or state-specific business portals) to identify grants relevant to your business needs. Be aware of eligibility criteria and application deadlines.

Upcoming Regulatory Changes:

Staying compliant with regulations is essential. Be aware of the following changes:

• Wage Theft Laws: Intentional underpayment of wages can now be a criminal offense. Small businesses can adhere to a Voluntary Small Business Wage Compliance Code to avoid prosecution.
  • Ensure: Review your payroll processes to guarantee accurate and timely payment of wages and entitlements. Familiarize yourself with the Voluntary Code.

• "Right to Disconnect" Laws: Small business employees will have the right to refuse contact outside of working hours from August 2025, unless it is unreasonable.
  • Prepare: Develop clear communication guidelines with your team regarding after-hours contact.

• Privacy Law Reforms: Amendments to the Privacy Act are being introduced throughout 2025, including a statutory tort for serious invasions of privacy and new requirements for privacy policies, especially regarding automated decision-making.
  • Review: Update your privacy policies and data handling practices to align with the evolving privacy regulations.

• Changes to Land Tax Thresholds (NSW Example): Land tax thresholds in some states may be fixed, impacting property owners.
  • If applicable: Stay informed about land tax changes in your state.

• Expansion of Plastics Ban (NSW Example): Further bans on certain single-use plastics are coming into effect.
  • If applicable: Ensure you are aware of the banned items in your state and have transitioned to alternatives.

Key Takeaway for Small Business Owners:

The current economic climate requires adaptability and awareness. By staying informed about economic trends, leveraging available government support, and preparing for regulatory changes, your small business can navigate these times effectively.

Exceeding Business is here to support your financial management and bookkeeping needs. We can help you understand these changes and ensure your business remains compliant and financially healthy. Contact us today for a consultation!