In the past 12 months the survival of 22% of SMEs was threatened due to cash flow shortages, according to the latest Bibby Barometer Small Business Survey.
The survey found that Australia's small business owners are increasingly concerned about the current global economic situation, with around half (47%) more concerned than they were a year ago.
Twenty-six percent of decision makers had difficulties meeting liabilities to suppliers on time, and 24% had difficulties making their tax payments.
The majority of SMEs were also worried about interest rates, with 54% believing that an interest rate hike of 25 basis points will impact or seriously impact their business.
Conducted in February 2012 and the second of its kind, the national study is run twice yearly, surveying primary decision makers in over 200 non-retail SMEs.
The survey measures small business expectations for a healthy business environment – based on intention to invest in the business, expectations of sales growth, ease of managing cash flow, business confidence, and levels of business stress. Since the previous reading in July 2011, this survey shows that small business expectations have decreased overall by 6%.
Greg Charlwood, Bibby Financial Services Managing Director, said the second survey has revealed that expectations regarding sales growth have deteriorated and cash flow is more difficult.
"It is clear that current global economic conditions are not only impacting large corporations but also filtering down to Australia's SME sector.
"According to our latest survey, managing cash flow (39%) ranks at the same level as three other major business headaches: staffing issues (40%), a lack of time to enjoy family life (40%), and government red tape and tax administration (39%).