Purpose and use The Business PSI is robust not only because the measure comes directly from a survey of business proprietors and managers, but also because it measures current performance, with metrics derived from their actual earnings, expenses, staffing numbers, as well as sentiment – their economic cost and growth forecast and expectations of the 6 months ahead. Rather than being a national measure, the Business PSI is designed to be deployed in local and regional geographies because it measures economic conditions, regulatory settings, and infrastructure in a local context. This allows for a more nuanced understanding of business performance and conditions. It gives a good measure of local economies and allows for comparison of business performance by region, across a city, within a state, and across states. Additionally, the Business PSI is designed as a longitudinal instrument, and so business performance can be compared by region over time to get real-time analysis of local economic conditions, and so see the impact of local policies, investment, and infrastructure development, as well as measuring the impact of state and national issues and economic conditions. Deployment The Business PSI is a tested and easy-to-deploy 21 question survey which can allow business chambers and local governments to survey their business stakeholders at any point in time, and compare these results to previous measures or benchmark across other areas. It also allows industry groups and peak bodies to measure their members and so gain a PSI of specific business categories (such as hair-dressers, real estate agents, etc.) or broader business categories (i.e. retailers, B2B service providers, etc.). The Business PSI results can be compared longitudinally, city by city, or state by state. As the Business PSI quantitatively measures business performance yet incorporates attitudes, sentiment, and forecast, it provides a comprehensive measure of actual and attitudinal measures and an index that incorporates recent performance and current forecasts.   BUSINESS PSI DESIGN The McCrindle developed Business Performance Sentiment Index (Business PSI) is an ongoing measure of business performance, conditions, and sentiment, developed from the input of several instruments. It delivers a snapshot of how businesses in the region are tracking, thus capturing the current pulse of local businesses. The 2015 inaugural edition of the Business PSI features the results of businesses from across the Hills Shire.

2. BUSINESSES IN AUSTRALIA – ACTIVELY TRADING
2,100,000

3. SMALL BUSINESS NATION
Non-
employing
61%
Employing
39%

4. SMALL BUSINESS NATION
Non-employing
61.0%

5. SMALL BUSINESS NATION
Non-employing
61.0%
Micro (1-4)
27.0%

6. SMALL BUSINESS NATION
Non-employing
61.0%
Micro (1-4)
27.0%
Small (5-19)
9.5%

7. SMALL BUSINESS NATION
Non-employing
61.0%
Micro (1-4)
27.0%
Small (5-19)
9.5%
Medium (20-199)
2.4%

8. SMALL BUSINESS NATION
Non-employing
61.0%
Micro (1-4)
27.0%
Small (5-19)
9.5%
Medium (20-199)
2.4%
Large (200+)
0.1%

9. SMALL BUSINESS NATION
Non-employing
61.0%
Micro (1-4)
27.0%
Small (5-19)
9.5%
Medium (20-199)
2.4%
Large (200+)
0.1%
99.9% of all Australian
business are small to
medium enterprises

10. 700,000
BUSINESSES IN NSW – ACTIVELY TRADING
That’s 1/3 of
Australia’s total

11. BUSINESSES STARTS AND EXITS (NSW)
385
350
New start-ups every
business day
New closures every
business day

12. SURVIVAL RATES
3 year survival rate – all businesses
61%
3 year survival rate – new businesses
50%

13. EXIT RATES - CONTRIBUTING FACTORS
Annual exit rate By sector By employment By structure By turnover
0% 10% 20%
National: 12.7%

14. EXIT RATES - CONTRIBUTING FACTORS
Annual exit rate By sector By employment By structure By turnover
0% 10% 20%
IT: 14.7%

15. EXIT RATES - CONTRIBUTING FACTORS
Annual exit rate By sector By employment By structure By turnover
0% 10% 20%
Accommodation
& food services:
14.9%

16. EXIT RATES - CONTRIBUTING FACTORS
Annual exit rate By sector By employment By structure By turnover
0% 10% 20%
Admin & support
services: 15.8%

17. EXIT RATES - CONTRIBUTING FACTORS
Annual exit rate By sector By employment By structure By turnover
0% 10% 20%
Non-employing:
15.5%

18. EXIT RATES - CONTRIBUTING FACTORS
Annual exit rate By sector By employment By structure By turnover
0% 10% 20%
Unincorporated:
17.6%

19. EXIT RATES - CONTRIBUTING FACTORS
Annual exit rate By sector By employment By structure By turnover
0% 10% 20%
Less than
$50,000:
20.3%

20. METHODOLOGY

21. METHODOLOGY
• Online survey August 2015
• Survey of businesses geographically located in the Hills Shire LGA
• 179 business owners and managers completed the survey
• 90% owners/managers of businesses
• 15 sectors represented
Bu s in es s PSI Res ea rch Pa rtn ers :

22. WHO ARE THEY?
70% 30%
Gender
Male Female 1%
9%
41%
46%
2%
18 - 20 21 - 35 36 - 50 51 - 69 70+
Age

23. 9%
6%
6%
16%
28%
35%
Year 11 or below (includes…
Year 12
Certificate III/IV
Diploma and Advanced Diploma
Bachelor Degree
Postgraduate Qualification
Highest level of completed education
WHO ARE THEY?

24. 26%
41%
23%
5%
2%
3%
Not employing / Sole operator
1 to 4
5 to 19
20 to 50
51 to 100
More than 100
Business Size by Employees
WHO ARE THEY?

25. 21%
10%
17%
53%
Less than 3 years
3-5 years
5-10 years
10 years or more
Length of being a business owner
WHO ARE THEY?

26. CONDITIONS
PERFORMANCE
SENTIMENT

27. 3 Categories
9 Measures
21 Indicators

28. Economic conditions
Local economy
National economy
Regulatory settings
Red tape
Policy settings
Infrastructure & locale
Local infrastructure
Business growth
Local outlook
CONDITIONS

29. Earnings
Revenue
Profit
Cash flow
Expenses
Operational expenses
Capital expenses
Employment
Staffing levels
Staff wages
PERFORMANCE

30. Economic outlook
National
Revenue
Cost forecast
Expenses
Staffing levels
Growth forecast
Profit
Cash flow
Expansion
SENTIMENT

31. 5% 10% 11% 27% 14% 15% 18%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Q. Thinking about your overall sales revenue at the moment, how do they compare
to 6 months ago?
Significantly worse
(10%)
Moderately
worse
(5 to 10%)
Slightly
worse
(1 to 5%)
About the same Slightly
better
(+1 to 5%)
Moderately
better
(+5 to 10%)
Significantly better
(+10%)
EXAMPLE QUESTION

32. BUSINESS PSI

33. BUSINESS PSI

34. BUSINESS PSI

35. BUSINESS PSI

36. BUSINESS PSI

37. C, P AND S SNAPSHOT

38. C, P AND S SNAPSHOT

39. C, P AND S SNAPSHOT

40. C, P AND S SNAPSHOT

41. C, P AND S SNAPSHOT

42. C, P AND S SNAPSHOT

43. C, P AND S SNAPSHOT

44. C, P AND S SNAPSHOT

45. C, P AND S SNAPSHOT

46. CONDITIONS

47. CONDITIONS OVERVIEW

48. Non employing businesses
CONDITIONS BY BUSINESS SIZE
-26
-24
-11
-13
Non employing businesses
Micro (1-4 employees)
Small (5-19 employees)
Medium+ (20+ employees)

49. PERFORMANCE

50. PERFORMANCE OVERVIEW

51. -7
12
PERFORMANCE BY CLIENTS SERVED
B2C: Products/services to
consumers
B2B: Products/services to
businesses, public utilities
and/or government

52. SENTIMENT

53. SENTIMENT OVERALL

54. SENTIMENT BY BUSINESS SIZE
0
8
6
12
Non employing businesses
Micro (1-4 employees)
Small (5-19 employees)
Medium+ (20+ employees)

55. NEXT STEPS

56. • Further analysis
• Longitudinal
• Benchmarking
• Next deployment: March 2016
Su p p o rted by:
NEXT STEPS

57. +6 12 8824 3422
info@mcc rindle .com.au
www. mc c rindle.c om.au
Mark McCrindle