SMB Trends in 2025: What the Latest Business Statistics Show

Small to medium businesses (SMBs) in Australia are under more pressure than ever to adapt, grow, and compete, often with limited time, budget, and support.

Despite this, many SMBs are finding ways to do more with less by leaning into technology and offering better customer service to stay ahead.

In this article, we’ll explore seven key trends we’re seeing from SMBs in Australia. Using data from trusted sources and our latest Small & Medium Business Trends Report, we’ll unpack what is setting growing businesses apart and how you can do the same with your business.

Before we dive into the nuts and bolts of what’s driving SMB success in 2025, let’s take a quick look at the bigger picture.

Here are the key statistics behind the Australian business landscape, based on the latest data from the Australian Bureau of Statistics (ABS) and our Small & Medium Business Trends Report (6th Edition).

• Sector size: 2,662,998 businesses were actively trading in Australia as of 30 June 2023, according to the ABS. Of these, 97.2% were classified as small businesses with fewer than 20 employees.
• Business entries and exits: 436,018 new businesses entered the market, while 362,893 exited, resulting in a 2.8% year-on-year growth.
• Business size: Non-employing businesses made up 62.5% of the total , with 26% employing one to four people. This reflects the continued dominance of sole traders and micro businesses in the economy.
• Survival rates: Finance and insurance services had the highest business survival rate , while sectors like accommodation and food services saw the most churn.
• Failure rate: Roughly 20% of new businesses fail within their first year, and nearly 60% fail within three years.
• Revenue growth: According to our latest research, 81% of SMB leaders feel optimistic about the future; 62% are classified as ‘growing’, with revenue growth above 5%.
• Digital investment: 76% of SMBs say they’re increasing technology investment, with only 5% reducing spend, highlighting the ongoing shift toward digital tools as growth enablers.

Small to medium businesses need to be ruthless about where they invest their time and resources. Having clarity on what matters most makes it easier to make informed, confident decisions.

The following seven trends reflect the strategies businesses are using to stay competitive and profit-positive.

1. Optimism and growth remain strong
2. Technology investment as a growth edge
3. SMBs are outmaneuvering large competitors
4. Revenue growth correlates with a focus on customer experience
5. Quality data leads to informed business decisions
6. Overwhelming technology stacks are slowing teams down
7. Security and scalability now drive technology buying decisions

Of the 3,350 SMB leaders surveyed, most feel confident about the year ahead. In fact, 81% say they feel optimistic about their business future; 47% feel very optimistic and 34% say somewhat optimistic.

For many SMBs, that optimism is paying off, with around 62% of SMBs currently growing and revenue increasing by more than 5%.

Seventy-six per cent of SMBs say they’re spending more on technology than they did last year, while only 5% are pulling back. For small businesses that need to stay lean and move fast, making measured investments in the right tools can have a big impact.

The biggest technological areas of focus for SMBs right now is AI. We found that 75% of SMB leaders say they’re investing in AI in some capacity, and over a third have already fully implemented it into their operations.

Additionally, when we looked at what separates growing SMBs, they’re 1.8x more likely to be investing in AI than their declining peers.

A great example of AI automation helping SMBs reach new heights is Parkable. After setting up automated workflows in Slack and implementing autonomous agents to handle common queries, their business saw a 38% increase in conversion rate and a 50% decrease in time to conversion.

Brody Nelson, Co-founder and CTO, Parkable.

Over at Audata, a global media startup, the team now expects Agentforce will handle up to 60% of all their customer inquiries, resulting in a 25% reduction in case resolution time.

For SMBs, the right technology should reduce friction, speed up sales, and result in growth that is evident in your revenue.

According to our Small & Medium Business Trends Report, 79% of SMB leaders say they offer more unique value than their larger competitors, and 77% believe they have stronger customer relationships.

Small businesses have a clear advantage here as they can build closer customer relationships and move faster. That combination is a powerful way to compete with bigger players.

Our research shows that revenue-positive, growing SMBs focus on the customer experience, while businesses with flat or declining revenue tend to pour their effort into new customer acquisition. It’s a reminder that agility, authenticity, and closeness to the customer are still some of the strongest advantages SMBs have.

Geocon is a great example of this in practice. After building a customer portal powered by an AI agent, they reduced defect case handling from 6.5 hours to near-instant. They also lifted data compliance from 33% to 100%.

Geocon is transforming the way they work with Salesforce.

Most SMBs know data matters, but few are making the most of it. In our latest Small & Medium Business Trends Report, 82% of SMB leaders said better data would improve productivity, and 80% said it would increase revenue.

Canva, Australia’s most successful design platform, recently released new research on data storytelling . In the report, they shared practical tips for businesses looking to get more out of their data, including:

1. Replacing spreadsheets with live dashboards that highlight trends.
2. Using AI to clean and organise data.
3. Sharing templates and playbooks to keep teams consistent.

In our latest research, we found that the average small business uses seven different apps to run daily operations, and more than half say they feel overwhelmed by it.

Another 50% report data inconsistencies between tools, which makes decision-making harder than it should be.

At the SMB stage, you don’t generally need to pack on more tools. Instead, strive for better integration between software.

AI is now playing a bigger role in bringing systems together. In the Executive Conversations session below, Rowena Westphalen, SVP of Innovation for Salesforce, shares how AI is helping businesses sync data, surface insights, and move from product-led to customer-led growth.

For high-growth SMBs, security now matters more than cost-cutting. According to our latest SMB report, 81% of SMB leaders say they’d pay more for vendors they trust and tools that can scale with them.

With 47 million data breaches reported in Australia in 2024, it’s no surprise that businesses are prioritising systems that are secure and built to grow, rather than cheaper products that won’t hold up.

Tools like Shield 2.0 support encryption, track access history, and flag unusual behaviour, giving teams more control over how sensitive data is handled and protected.

The most successful small and medium businesses in Australia are leaning into agility, technology, and customer experience. From smarter software choices to better use of data, these trends show what it takes to grow sustainably in 2025.

Want to dive deeper into the data? Download the full Small & Medium Business Trends Report (6th Edition) for more insights from 3,350 business leaders around the world.

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