New Xero initiative to provide unprecedented data on SMEs
The data set, updated monthly, will provide a real-time snapshot into Australia's small business economy.
Xero has today announced the launch of a new platform which will provide comprehensive data around Australian small businesses. Xero Small Business Insights, developed alongside global advisor KPMG Enterprise, will provide a monthly snapshot of data from Xero’s some half a million subscribers across five major pillars.
Speaking at the launch event in Sydney, Xero Australia’s managing director, Trent Innes, described it as an up-to-date metric showing the health of the small business economy in Australia.
“It’s a snapshot of the small business economy, aggregated and honest,” he said.
The data is anonymous and pulled from Xero subscribers that “meet the criteria for each pillar”, according to Xero’s statement. The five pillars are cash flow, payments, employment, trading overseas and cloud adoption.
The insights dashboard has already pulled out some interesting statistics, for example, that only 50.7% of Australian small businesses had positive cash flow as of June 2017. However, this was an increase of 1.7% compared to the same time last year.
Lack of data on small businesses
KPMG special advisor and demographer Bernard Salt AM said the initiative is a great leap forward considering the lack of data around small businesses.
“I called it the Hubble Telescope of data in business for Australia,” he said at the launch event.
“I think there is an entire life form in Australian small business that we haven’t really been able to see before, but we can see it now.”
“Typically, the Australian Bureau of Statistics (ABS) doesn’t provide regular insightful data around small business. They are fantastic with the business community in general, but not at the small business level.”
While the data only covers 500,000 Xero subscribers, Salt points out that if these employ three to four people, the data would cover two million people.
“It’s into the heartland of the Australian economy,” he said.
Insights on what matters
Australian Small Business and Family Enterprise Ombudsman Kate Carnell, who was also at the launch, said reliable data was imperative to helping solve small business issues.
“For small businesses, or small- to medium-businesses, payment times are a growing problem...We need good data on this," she said.
“What we’ve got here is half a million small businesses, real data, monthly data, looking at things that matter.”
In terms of payment times, Xero Small Business Insights has revealed that they are improving. Invoices with 30-day payment times were settled in an average of 36 days in June, which is down from almost 40 days one year prior.
The prime audience for the dashboard is government, enterprise and small business, with Innes saying that the data could even provide insights into whether a government initiative has been effective.
“Even if the government, for example, puts in some policy or makes an initiative, we should be able to see that trend line over time and see if it’s actually impactful.”
According to Salt, this is the first time Australia can get "real insight" into how the Australian small business economy is tracking.
"Thanks to Xero providing access to their deep analytical insights, enterprise and government will have greater access to information when shaping their investment, policy and decisions," he said.
“It’s only a matter of time before the Xero Small Business Insights ‘dashboard’ is included in all management and board briefing papers indicating the state of the economy.”
The Xero Small Business Insights dashboard is available here.