Renewed Consumer and Business Confidence Brings New Asset Finance Opportunities
With over 70% of the Australian population being vaccinated, and rates continuing to rise, lockdowns easing, travel resuming, and the property market showing no signs of abating, some analysts suggest these factors are boosting Australian consumer and business sentiment.
As Australians shift into a more positive state of mind and business conditions steadily improve, here’s what asset finance brokers need to know to take advantage of new growth opportunities and which industries they should focus on in the coming months.
Australian Consumer Sentiment on the Rise
Despite recent lockdowns, consumer sentiment increased by 2% in September to 106, up from 104 in August due to the improving vaccine situation, according to the Westpac-Melbourne Institute Index of Consumer Sentiment.
The Index revealed several other positive indicators, including an improvement in consumers’ outlook on their family finances versus a year ago and the labour market, and growing confidence among women, who have been disproportionately affected by the lockdowns.
Looking at 2021-22, IBISWorld’s Consumer Sentiment Index forecast a drop of 1.6%, but analysts there also expect consumer sentiment to improve in early 2022 with the completion of the vaccine rollout.
For asset finance brokers, the takeaway is that consumer optimism is increasing, which is good news for household spending, revenue growth and business expansion.
Business Conditions Make Gains
Only a quarter of businesses reported decreased revenue in June 2021, compared to nearly half a year ago, suggesting an uplift in business conditions and sentiment as summer approaches.
In the same Business Conditions and Sentiments report from the Australian Bureau of Statistics, two in five businesses said it would be “easy or very easy” to meet their financial commitments over the next three months.
There are still headwinds for businesses of all sizes, including an increase in staff shortages, primarily in construction and retail trade, and difficulties finding suitable staff. But that also means a hiring spree is on the horizon with nearly a quarter of businesses expecting to bolster staff numbers over the next three months.
Industries Asset Finance Brokers Should Watch
As an asset finance broker, consider focusing on the industries that the ABS reported felt most confident about being able to meet their financial commitments, including:
- Financial and insurance services
- Rental, hiring and real estate services
- Electricity, gas, water and waste services
- Transport, postal and warehousing
Financial stability is a strong indicator that the business is thriving and may be looking for new opportunities to acquire assets for expansion.
Steps to Find New Asset Finance Business
- Reach out to existing clients: Use Digital Marketing Hub to send emails to clients whose profiles match the industries you want to target.
- Reconnect with referral partners: Talk to them about the new industries and clients you’re seeking.
- Learn more: If you’re interested in focusing on a particular industry, you have to educate yourself first so you can build credibility and trust with new clients. Read industry news, talk to industry insiders, and leverage your existing network to make connections.