New customer segments and cost/expense reduction are the most commonly identified opportunities for SMEs in Australia according to the Zurich
2014 SME Survey.
While new customer segments still came out top in the second annual Zurich
survey, the results were markedly down from last year. In 2013, 45% of SMEs listed new customer segments as their top priority for growth; in 2014 that number shrank to 31%.
Compared with the 2013 survey, three times as many SMEs cited the diversification of product range and services as an opportunity for growth over the calendar year.
James Makin, head of commercial portfolio management explained the results saying; “The picture that emerges for Australian SMEs has ramifications for insurance because of the particular risk exposures implied by a business pursuing any of these opportunities.”
“If a business plans to move into new areas in which it is not expert, such as seeking out new customer groups or providing new products or services, it should ensure that it has adequate insurance in areas such as public and product liability.”
Similarly, Makin highlighted the constant need to reduce costs as an area that the insurance industry could take note.
“A business wanting to reduce costs may be trying to do what it used to do but with less staff and less resources. In such an environment, where corners are being cut, accidents and mistakes are more likely to happen. Again, adequate insurance becomes critical to protecting the business.”
Australian SMEs are beginning to focus more on the domestic market according to the Zurich
survey. The perceived opportunity for growth into foreign markets saw a dip in this year’s results with only 10% of SMEs noting it as an opportunity compared with 24% a year ago.