Australian private companies are more confident about the future than 12 months ago, but are suffering due to a lack of quality infrastructure, a new survey reveals.
Australian private companies are more confident about the future than 12 months ago, but are suffering due to a lack of quality infrastructure, a new survey reveals.
The KPMG Private Companies’ Survey finds businesses are confident about the coming year, with over half of respondents claiming they expect revenue growth of 6% to 20%.
The survey also shows companies believe employee talent and commitment, brand reputation and quality of services will enable them to see their expected levels of growth.
But KPMG partner Don Abell says some businesses have changed their tone since the survey was gathered at the end of June.
“Even when we had subsequent focus groups after the findings in June, they recognised this is very much a changing environment,” he says. “Some of these businesses said ‘some of the answers we gave in June may have changed by the end of July’.”
Abell also emphasises challenges for businesses within the coming year. Many are worried by the skills shortage, with 92% listing it as their primary concern and nearly 40% saying they are either hiring workers from overseas or are considering doing so.
Infrastructure is another big main problem, with 85% of respondents claiming bad infrastructure is restricting competitiveness.
“Companies were strong in their response that infrastructure was not keeping up with what they needed to run their business. The road network in NSW particularly, in Victoria they talked about water, power was also an issue in NSW.
“All of them mentioned the rail networks. It wasn’t satisfactorily serving their needs of getting their products to customers.”
Abell also says climate change is a problem. Over half of businesses surveyed say they do not fully understand the potential effects of climate change on their business, and over two-thirds claim they have no intention to act in the next 12 months.
“They are aware that action needs to be and should be taken within Australia,” he says. “But if you start to talk to them about what they need to do, they haven’t advanced as far on that.
“There is no view that they’re in a position to be leaders, because it’s an expensive area to be involved in and they don’t want to incur those costs until it’s necessary to do so.”
The survey also finds 75% of companies surveyed believe the economy is in a downward cycle, 56% believe they are competitive in the Asia-Pacific region, and 53% believe the success of their business relies on employee talent.
“Following last year’s survey, we have seen a significant increase in private companies providing flexible working hours, subsidising external study costs for employees and offering additional superannuation contributions or annual bonuses,” he says.
But Abell claims the most significant find is companies have dealt extraordinarily well with managing the current economic turmoil.
“What stood out in my view was that the economic impact to date had not had a big impact on these private companies,” he says. “They were aware of what was around while watching the economy and their customers… but to the date in June the impact had not significantly hit them.”
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