Australia

Growth 

Times may be difficult, but most private companies have not abandoned their plans for growth. However many are recasting these plans after a challenging year.

In our 2012 survey, more than a third of respondent businesses report suffering a fall in their profitability over the previous 12 months and a further 30 percent lifted profits by 5 percent or less over the previous year's figure. Thirty percent experienced a fall in the dollar value of their sales. Just under 44 percent of companies failed to meet revenue targets for their most recent 12-month period, which was almost exactly the same proportion that said they missed their targets in 2011.

 


Figure 1: Fulfilment of revenue targets for the latest 12 months period, nationally.

 

2011  2012

Exceeded targets 

21.23% 20.1%

Met targets

34.93% 36.2%

Did not meet targets

43.84% 43.7%
 

 
Figure 2: Business growth (sales and profit) as predicted in the 2011 Private Companies Survey, and actual results achieved, as reported in the 2012 survey.

 

Sales growth

Profit growth

% of responses

2011
Predicted
2012
Actual

Negative growth

6.6 30.8

0-5

34 30.8

6-10

30.9 17.2

11-20

19.1 10.9

21-30

4.2 5.3

More than 30

5.2 5.1
2011
Predicted
2012
Actual
8.1 36.7
36.9 30.4
23.7 10.6
17.4 7.8
7.2 3.7
6.8 10.8


Respondents' short-term growth strategies emphasise new products and services and expansion into new markets. In the medium to longer term, a majority of businesses expect growth to come via mergers and acquisitions.



Figure 3: Strategies for revenue growth (% of respondents).

 

Growth strategies 

Short-term
(12 months)
Medium-term
(3 years)
Long-term
(5+ years)

Diversification of new products/services into new markets 

55  33 11

Introduction of new products/services into existing markets 

64 30 6

Expanding existing products/services into new geographical markets overseas

41 36 23

Expanding existing products/services into new geographical markets in Australia

48 40 13

Acquisition of another business

26 45 29

Merger with another business

24 25 52

Organic growth 

63 26 11

 


Asked about the key challenges facing their businesses over the coming 12 months, nationally businesses cite continuing global uncertainty (34 percent), impaired consumer confidence (32 percent) and skill shortages (26 percent) as their main obstacles to growth. Other important factors include low business confidence and competitor activity.

 


Figure 4: Key challenges to business over the next 12 months (% of respondents).

 

Figure 4
 

Video: Private Companies Survey 2012

Video: Private Companies Survey 2012
KPMG's National Managing Partner of Private Enterprise, Peter Siebels, gives an overview of the findings from the Private Companies Survey 2012.

Full report

Private Companies Survey 2012 in PDF

Download a copy of the Private Companies Survey 2012 in PDF.