A Griffith University PhD candidate is calling on small-business owners and operators to aid in her research investigating how small business cash flow is influenced by taxation and literacy.
Small service businesses represent $292 billion of the total $850 billion generated by the service sector in Australia, and researcher Melissa Belle Isle says not only are small service businesses instrumental in generating a third of the small business sector income, they also employ 44% of all service sector employees, equating to 4 million people.
“A healthy small business sector makes for a stronger economy,” Melissa said of the impetus for her research. “Small service sector businesses involved in areas of consultancy, legal services, communications and media are among the fastest growing industries in Australia.
“Despite the dominance of service sector business in Australia, there is a paucity of research of service sector-wide matters.”
Cash flow, Melissa says, is identified as being a contributor to small business failure, and tax and owner literacy may cause further constraints to cash flow.
“Research suggests that adequate levels of financial statement, computer accounting software and taxation literacy of small business owners can be beneficial to financial stability,” Melissa said.
“This study examines the connection between taxation, cash flow and literacy for businesses with an annual income of less than 10 million dollars.
“The research specifically focuses on service-related businesses due to the magnitude of the service sector in the Australian economy.”
Melissa’s research to date has attracted both small business owners and experts from across the nation. Her goal in the final stage of her data collection is to reach service businesses across Australia to capture the diversity of the small business sector.
Through her research, Melissa will attempt to determine what level of owner/operator literacy would be adequate in terms of financial statements, computer accounting software and tax.
The final stage of her research will consider small-business owner confidence, understanding, perception, engagement and applied knowledge of cash flow, taxation and literacy, in an attempt to gain a greater understanding of how these relationships could improve the survival rate of small businesses in Australia. It is hoped that this increased understanding could lead to important recommendations to help this sector.
If you are the owner or operator of a small business (<20 employees), you can provide your insight by completing the online survey here.