A new report shows that aging business owners may lead to a major shake up of the Australian small business sector over the coming decade, with the highest proportion of small business owners aged between 45 and 59 years.

Released at the COSBOA National Small Business Summit by the Australian Small Business and Family Enterprise Ombudsman Kate Carnell, the Small Business Counts report has revealed 61% of employing small business owners are approaching retirement age.

Ms Carnell says the generational shift presents a number of challenges for the sector and the economy more broadly.

“The small business landscape will be transformed over the coming years with a significant number of older small business owners expected to retire, sell or move on,” Ms Carnell said.

Succession planning will be increasingly important within the industry.

“We know access to funding continues to be a barrier to small business operators,” Ms Carnell explained, “so some of the business owners looking to sell may find it difficult to attract a buyer.”

“These figures show that there is a need for meticulous succession planning by those small business operators who are planning to retire in the coming years.

Other challenges are revealed within the report, including the fact that more than half of small business owners report a taxable income of less than the minimum wage, while late payments continue to hamper small business viability, with half of all small businesses reporting late payments on 40% of their invoices.

Yet Ms Carnell said the report showed the small business sector is surprisingly large and vibrant, which is vital to the health of the Australian economy.

“We know that small business is the most dynamic and fastest growing sector and yet it is often overlooked by all levels of government when setting the policy agenda.
 
“The statistics, collected from various Australian government agencies, helps us gain a greater understanding of the small business sector, which is vital to the work we do.

Read the Small Business Counts report here.

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