Australian small businesses losing out on credit card rewards and digital growth
According to research released by American Express, over 60% of Australian small businesses are losing out on rewards from an estimated $15.6 billion every year just because they are using forms of payment that don’t attract rewards.
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Only 38% of small businesses in Australia use a credit or charge card that offers rewards to pay for their business expenses. In fact, 37% of businesses don’t use a business credit or charge card at all, revealed the survey.
Martin Seward, Vice President of American Express Small Business Services said that small businesses spend, on average, $52,000 annually on business expenses and that savvy owners are increasingly turning their business spend into rewards opportunities.
“Running a small business is a costly exercise. By simply changing the way expenses are managed, costs like rent, utilities and supplies can quickly become business enablers like free flights, accommodation or statement credits.”
“Our research shows that cash flow is currently one of the top three challenges for small business owners, behind attracting new customers and finding enough time to get everything done. Tools like credit and charge cards, when used responsibly, can help manage this challenge and allow businesses to free up cash flow,” he added.
The study found that less than half (41%) of small businesses with credit and charge cards take full advantage of credit terms on their cards by using the maximum amount of time available to pay their bill. Almost half (48%) pay their bill within two weeks of receiving it, with 20% paying it as soon as they receive it.
Consumers looking for company credit cards to manage business expenses and cash flow, while earning rewards on their outgoings, can head to Mozo’s business credit card section to compare the different cards on offer by the interest rate, annual fee and rewards programs.
According to another report by prepared by PwC for Google Australia & New Zealand, small business use of mobile and Internet technology is currently limiting their ability to reach their full digital potential. The analysis shows that small businesses can unlock an additional $49.2 billion of private sector output over the next ten years by making better use of these technologies.
“These days, when we need something, we go online. Small businesses dealing within the financial and insurance services sector have a huge amount to gain from the web - by finding new customers with online marketing, making their customer experience better, or handling tasks on the road using the cloud. The internet is helping more and more small Aussie businesses prosper and grow,” said Richard Flanagan, Head of Small Business Marketing, Google Australia.
The study also shows that while all regions and industries can benefit from using this technology, some have more to gain than others. For instance, 53% of the potential economic benefit can be made by small businesses located outside Australia’s inner metropolitan centres. Additionally, 17% of Federal electorates (or 25 of the 150) could account for 50% of the potential private sector boost to the economy.
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