Although not traditionally commemorated with the bang of fireworks and the flow of champagne, the new financial year is often a moment of quiet reflection and forward thinking for public sector suppliers. When embarking on fiscal planning for the year ahead it is important to take a holistic approach, incorporating business planning, government trends and marketing strategy.
For this upcoming financial year, here are some important points to consider. The Australian Chamber of Commerce and Industry has criticised the federal government’s new plans for engaging with small businesses. In the press release issued July 1, ACCI Chief Executive Peter Anderson listed a wave of anti-business policies, saying:
“While…politicians have spent months arguing about leadership, an unprecedented wave of anti-business decisions have been made, some rushed through and without due process. Small business especially will find their compounding effect difficult to finance and manage.” Those highlighted include:
• 5% increase to the carbon tax (1st July);
• Award wages up 2.6% (1st July);
• Superannuation levy paid by employers rising to 9.25% (1st July)
Another hit for the everyday running of businesses big and small in Queensland will be an increase in electricity prices. As reported by ABC Online; ‘The 22.6 per cent rise will mean an extra $268 a year added to the average household bill. The small business tariff rises by 17.4 per cent.’
Top Trends to Follow this Financial Year
Although these policies highlight some planning concerns for small businesses, there is also good financial news on the horizon. A growing number of economists predict 2014 will be the year of global economic recovery, seeing a possible end to the reverberating effects of America’s fiscal cliff. Analysts from IBISWorld predict a boom across four Australian industries:
• Superannuation funds to rise by 40.5 per cent
• Online shopping to rise by 13.3 per cent
• Internet publishing and broadcasting to rise by 12.7 per cent
• Wind and other electricity generation to rise by 11.3 per cent
For government suppliers, the online shopping and internet publishing booms represent the positive impact of the NBN, which could present an array of online opportunities. In addition, a continuing boom in resources and electricity generation may open opportunities for innovation and supplier engagement.
Economic predictions aside, the new financial year also calls for a back-to-basics approach for business plans. For suppliers this includes keeping a tight control of the supply chain, looking towards new technologies, keeping abreast of government trends and checking your marketing strategy.
With the up-coming election continuing to dominate headlines, commentators are predicting a number of trends for the public sector. For education suppliers it is important to look for new developments in the Gonski funding models. Education contracts and tenders will be dependent on these changes, as the education reform aims to take away from universities and give to schools.
Another development of note is the passing of the local government referendum through the senate. This could have an impact on suppliers looking to market to local government, as funding models are likely to change if the referendum is a success. Originally planned for September 14, the referendum is now being debated due to the change of leadership.
In the area of health, suppliers can benefit greatly by looking for areas of interest or specialisation. For example aged care continues to dominate as a boom market needs, and there continues to be a rise in the need for mental health services.