Australian small businesses call for action against eCommerce
New research indicates that nearly two-thirds of small businesses in Australia are advocating for governmental intervention to safeguard local retailers from international eCommerce marketplaces.
The findings come from Sendle's latest Small Business Survey, which examined the perspectives of small business leaders across Australia. Of those surveyed, 64% expressed a desire for government action to shield domestic retailers from online competition. The survey further highlights that external eCommerce platforms like Temu and Shein are creating additional pricing challenges for small to medium-sized businesses (SMBs), a sentiment shared by 48% of the participants.
Amid these competitive pressures, many businesses have started offering free shipping—a tactic employed by half of the respondents compared to 2023's 38%. "Sendle's latest survey shows that Australian small businesses are concerned about competition from overseas retailers who can sell a broad range of products at very low prices," said Laura Hill, Managing Director of Sendle. "To attract and keep customers, we have seen a lot of small businesses hunt around for better shipping rates and options, in order to offer free or discounted shipping to customers."
Shipping has become a crucial strategy for attracting customers, and 24% of SMBs argue that international platforms gain an undue edge with lower shipping costs. A pronounced concern is emanating from regional and rural sectors, where 71% of small businesses are seeking improved shipping options to better compete with larger corporations. Hill noted, "Australia Post has a monopoly in regional and rural areas, which has led to less competition and higher shipping rates for small businesses who have no other options. Limited shipping options make it difficult for small businesses to compete online as customers expect faster and affordable shipping, and eat into their profit margins, making it harder for them to stay ahead in a highly competitive retail industry."
Despite facing significant competition, SMBs maintain a positive outlook for this year's peak sales period, with 30% projecting up to a 25% increase in revenue compared to the previous year. This outlook is supported by Sendle's expectations of a 45% surge in average weekly parcel volumes during this period. Businesses are pushing towards increased social media engagement and enhanced marketing efforts, with 72% and 52% focusing their investments in these areas respectively.
Looking towards the future, 35% of SMBs aim to enter new markets for business growth. Currently, 42% of small businesses exclusively operate within Australia, yet an equivalent percentage anticipates that up to a quarter of their growth next year will be driven by international markets. Hill elaborated, "Small businesses are resourceful and resilient, and are looking at how they can market their brands, reach their target audience, and drive sales, even with limited budgets. Tapping into new markets can help small businesses to find new customers and boost their bottom line, which is why it's crucial they can get competitive shipping rates to do this."
