Almost 70 per cent of small business owners are anticipating growth in the next 12 months, according RSM Bird Cameron's thinkBIG 2015 study.
This compares to 64 per cent in 2014.
The study also found 49 per cent of SME owners reported growth over the last 12 months, which is up 3 per cent from last year.
Just 16 per cent reported a decline in revenue compared with almost 20 per cent last year.
RSM Bird Cameron national head of business solutions, Andrew Graham, said business owners were cautiously optimistic about the medium-term prospects for their business.
"Despite official interest rates hitting a historical low, consumer sentiment and spending remain subdued," he said. "Business owners are also feeling the pinch from a tightened cash cycle.
He said when looking at the results over the past few years, such optimism was not always realistic.
"When comparing expected growth with achieved growth, there is a clear gap," he said.
"For example, in 2014, 64 per cent of business owners believed their business would grow; however, the 2015 survey reveals that only 49 per cent achieved revenue growth.”
For 40 per cent of businesses, growth is expected to come through increased sales in the current pipeline.
A quarter (26 per cent) say they will achieve growth by targeting new markets, while 21 per cent and 20 per cent, respectively, say they will launch new products or services, or expand the business.
Graham said to compete effectively, businesses needed to adapt and evolve quickly to respond to what is becoming the new “norm”.
"Competition for customers and share of wallet is intensifying and now more than ever business owners need to be better connected to customers with a real focus on sales planning as part of their overall business strategy,” he said.
According to the study, the skills shortage remains the main barrier to growth, increasing from 35 per cent in 2014 to 39 per cent in 2015.
A lack of management time has jumped to the second-biggest barrier to growth from 18 per cent last year to 28 per cent in 2015.
Graham said the figures suggested that business owners were spending more time thinking and planning in response to the changing demands of the market.
“Business owners are well aware of the need to change their business model to remain relevant and keep their business sustainable," he said. "The red flag here is the readiness and capability of business owners to reposition their business to handle the challenges and take advantage of future opportunities.
“The most successful businesses will be those that address the rapidly-changing sales environment by recognising growth opportunities, ensuring due diligence and financing is appropriate and engaging their workforce to drive productivity.”
ThinkBIG has measured the Australian SME sector since 2005. It benchmarks business growth and profitability, business planning, exit planning, superannuation and the impact and uptake of technology.
There were 446 participants in the 2015 study.