Which advisers do micro‐firms use? Some Australian evidence

Abstract

Despite the growth of many new business advice and support services over the last 15 years, the extent to which such facilities are used by the Australian small business sector has not been extensively examined, especially amongst the micro‐enterprises that comprise the majority of all small firms. Home based businesses (HBBs) constitute the largest group of micro‐businesses in Australia, as well as comprising the biggest single SME sector in the nation. An investigation into the usage of advisory services by HBBs in Perth, Western Australia revealed substantial differences in the types and frequency of advisers used. It was found that accountants, banks, other business operators and family/friends were the most commonly consulted services. In contrast, lawyers, government agencies, industry associations, and management consultants were only infrequently used. The research project also attempted to determine if the frequency of adviser usage could be predicted on the basis of a range of individual and firm characteristics (namely, the age of the business, the size of the enterprise, and the age and gender of the owner/operator). A positive correlation was found to exist with all four factors, with micro‐firms managed by men tending to use advisory services more frequently.