For Australia’s resilient and innovative small business community, the dawn of the New Year brings with it new goals, opportunities and trends. But after we approach two years of the pandemic in Australia, how are our almost two-and-a-half million small businesses feeling about 2022? Are they optimistic, pessimistic, or unsure? What challenges and opportunities do they foresee? And how are they pursuing growth in 2022?

These are just some of the questions GoDaddy set out to answer in our recent ‘Entrepreneurial Pulse’ research. We interviewed over 1,000 entrepreneurs across multiple states and industries, measuring their insights on a range of topics from ecommerce and digital transformation, to upskilling and the pandemic. Here’s what our data reveals about Australian small businesses in 2022.

Long-term optimism

While short-term challenges remain, particularly as COVID cases continue to rise in Australia, the long-term outlook is one of overwhelming optimism. In fact, GoDaddy’s research found that two in three respondents are feeling either ‘optimistic or very optimistic’ about their business’ outlooks in 2022, while just one in ten are ‘concerned or very concerned’.

Younger Australians have been disproportionately affected by the pandemic’s impact on the jobs market, but they are feeling more positive than every other demographic. In fact, almost three quarters (72%) of 18-24-year-olds surveyed said they feel ‘optimistic or very optimistic’ about 2022.

Online and in-store

For many years technology was perceived as inaccessible and unaffordable for many small businesses. However, thanks to online solution providers like GoDaddy, small businesses and everyday entrepreneurs now have access to intuitive and powerful tools to build a website and start or scale an online business. In 2022, an online presence has become the primary sales channel for most of our research respondents.

Almost two-thirds (62%) of those surveyed said that having an online presence is either ‘more or much more important’ than having a bricks-and-mortar store. Physical businesses are still essential parts of the Australian high street, but today an online presence is responsible for, on average, over half (53%) of a small business’ annual revenue. For one in four small businesses (23%) surveyed reported that their total business revenue comes from online sales. Almost half (46%) said they believe a business cannot succeed today without having a website.

Take, for example, Debora Krizak, the Founder and Director of Sydney small business The Really Useless Candle Co. Debora decided to turn a passion into a purpose when the pandemic first hit in Australia. She built a website selling candles and used the surge in ecommerce sales to grow her business, even during lockdown. Because of the pandemic and the growth of ecommerce, it didn't make sense for Debora to invest in a physical space. Instead, her business is online first, and her website and the digital skills she’s developed during the pandemic are the source of her optimism in 2022.

While lockdowns are hopefully a thing of the past and high streets are beginning to resemble their usual bustling selves, an online presence is still essential for consumers today. Millions of consumers research, discover and engage with businesses online today. It’s clearly a trend our small businesses are ready to capitalise on, with over a quarter (27%) report that they plan to invest in an ecommerce website or online store, 24% in social media integrations and 21% in shipping and delivery services.

Challenges and skills shortages

For all the digitally driven optimism, there are still challenges. The biggest concern is a return to lockdown (according to 30% of respondents), followed by increased competition (27%), low customer demand (20%) and maintaining cash flow (19%).

Staff shortages have affected many businesses and industries, small businesses surveyed are less concerned. Only 14% said they are concerned about hiring staff, while a further 11% are concerned about retaining staff. Four in ten (39%) have no intention of hiring staff in 2022. However, those that do are prioritising soft skills like communication, teamwork and problem-solving rather than a relevant degree or hard skills like coding or bookkeeping.

If the last month has taught us anything, it’s that the situation remains volatile and unpredictable. However, as they have shown time and time again over the last two years, Australia’s small businesses are resilient, adaptable and innovative. With their newfound digital skills, and their experiences from the last two years as their foundation, they’re eager to overcome short-term challenges and help their businesses thrive in 2022.

Tamara Oppen is the Managing Director for GoDaddy Australia. GoDaddy is the company empowering Australian entrepreneurs to succeed online. For simple tech solutions to help make your life as a business owner easier, visit godaddy.com.au