New research shows that one-third of Australian small business operators fear they risk becoming insolvent in the next three to five years.
And this is no exception when it comes to the travel industry.
On top of this, 59 per cent of consumers don’t believe their shopping habits have any impact on the success or failure of small businesses.
In the lead up to Shop Small month, American Express’ Economy of Shopping Small report has found frequency of spend in small businesses has fallen by 12 per cent over two years among those who shop at least once a week at a local shopping village – 82 per cent in 2016 vs. 70 per cent in 2018.
This has led to three in five small businesses reporting flat or declining revenue growth year-on-year.
Consumers acknowledged their shortcomings, with 86 per cent admitting they could step up and do more to support small businesses. However, the majority of shoppers claimed to have good intentions.
This was revealed in the two-thirds of shoppers who said they feel a responsibility to support local businesses and the growing number who said they prefer to shop in a small business ahead of larger retailers, 53 per cent in 2017 vs. 65 per cent in 2018.
Small business owner, Tom Allwright, who heads Tasmania based travel company, Adventures Abroad, said there is a lack of consumer awareness around supporting local businesses.
“Supporting grassroots and small businesses in Australia is crucial to our economy and something we once excelled in,” he said.
Allwright said there is also an acute lack of awareness among small business owners about government funding initiatives.
“There is no doubt about the lack of awareness regarding access to Government funds that are available for small businesses to access in Australia,” he said.
“But having easier access to these grants will result in the substantial growth of small businesses.”
And it’s reflected in the research; just eight per cent have accessed government resources, grants or training during the past year.
“We have never received any support from the Government regarding funding or use of resources,” said Allwright.
“It’s something we certainly wouldn’t rely on, but if we were aware of assistance then we’d certainly look at how we could put it to best use.”
He believes small businesses of the Australian travel industry should aim to find their niche if they want to prosper.
“The travel industry is so diverse, which increases the importance to know exactly who your target market is and what relates to your community,” he said.
“We specialise in dealing with High Net Worth people, who are heading towards or are in that age of retirement and want to tick a few bucket lists.
“We have taken the advice of ‘be something to someone rather everything to no one’, meaning we need to know exactly who our audiences are and what we offer.
“We see a lot of large travel brands miss the opportunity to understand and build relationships with their local communities, which is where the opportunity lies for small and boutique businesses.”
Overall, Allwright said operating a small business in the travel industry is very rewarding.
“We get to explore the world and take our community on a journey they’ll remember forever.
“I love learning about people and building bonds with our customers that last a lifetime.
“I believe small businesses are the innovators of the world, and we have the opportunity to create something very special as people are travelling more than ever!
“Therefore it’s incredibly important to support small businesses this Shop Small month.”