Help in getting a suitable interest rate is the primary reason SMEs turn to a broker, but that reason ranked only slightly above several other factors. These included finding the most appropriate lender, and the best product for their needs. Help in making the process seamless, and guidance on the right types of finance available were also popular reasons.
Whether it’s filling in the gaps in your knowledge of the best options available or clarifying the merits of working capital vs asset finance, there’s no doubt many SMEs feel they need a bit of broker expertise to navigate the funding process. Almost a quarter are planning to use a broker to help them secure finance this year.
SMEs in the Financial and Insurance Services industry were the most likely to be currently using a broker as part of their trusted external advisory team, closely followed by Hospitality, then Professional, Scientific and Technical Services.
Those SMEs who said they didn’t use a broker either felt they had enough knowledge themselves, or had a colleague internally who could handle the borrowing process. A little under 20% said they dealt directly with the bank. It’s possible these respondents may not be aware of all the benefits of using a broker. An opportunity undoubtedly exists for SMEs to explore what a broker can bring to their business, particularly in securing the best interest rates.
Finally, while many see inflation as a barrier to growth in 2024, a majority of Aussie SMEs are cautiously confident about their business in the medium-to-long term. This no doubt reflects the generally positive, can-do attitude of this hard-working sector.
Where do the opportunities lie in this more subdued business climate? The majority of SMEs who said they reached or exceeded their revenue targets last year, largely did so by investing in new technology or developing existing products, in that order. In 2024, they plan to focus on the same things, and increase their investment in marketing.
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