Introduction
Welcome to the ninth edition of the PwC Private Business Barometer.
At the time the flooding hit Queensland, we were preparing to go into the field to interview private business owners for the ninth edition of the PwC Private Business Barometer. We knew that the focus for Queenslanders was on helping each other with the clean up effort and assessing and working through the impact on their businesses.
After consulting with our clients and colleagues, we decided it would be best to get the opinions of Queensland businesses
using other methods including roundtable sessions and online polling at existing events. We connected with business owners in Queensland on a personal level, holding sessions with a range of business owners to capture their feelings and response to the flooding and their plans for the future.
Nationally, more than half of the businesses surveyed reported having been impacted by the natural disasters earlier this year.
We have spoken to many Queensland private business owners, and at one particular breakfast event where we had almost 100 Queensland business owners in attendance, 53 per cent told us they experienced no significant impact while 26 per cent experienced significant disruption.
Perhaps in response to this, overall we found that businesses are cautious about the next 12 months but still optimistic about the next three years.
The underlying message though, is that businesses are reinvesting to prepare themselves for long-term growth. Sales are growing faster than profits which typically indicates that people are investing profits back into their business to help generate sales and create efficiencies for growth. Businesses are on the hunt for financing. During the global financial crisis we saw business owners looking internally for funding but banks have now re-emerged as a popular source of finance for investments. We’ve also seen a shift in the attitude of banks towards businesses. Banks are showing more understanding about the needs of private businesses and want to support them.
| However, they are not loosening the purse strings – so businesses need to clearly articulate and demonstrate their case. We again asked, “What would you like to grow?” and “Sales and profits” was the most common answer. This tells us business owners are squarely focused on the future direction and success of their businesses. In this edition, we had the pleasure of speaking to a private business owner who is on a phenomenal growth journey. Abigail Forsyth, CEO of KeepCup, created a unique product that has changed the landscape of coffee drinking in less than two years – and experienced yearon- year growth of 300 per cent. One of the interesting points for me has been the shift in how business strategies are being used over the lifetime of the PwC Private Business Barometer. In 2007 the majority of businesses didn’t have a plan and if they did, it was to satisfy lenders. Today’s PwC Private Business Barometer shows 94 per cent of businesses have a plan that is closely aligned to their growth strategy. More than 50 per cent of businesses review it regularly – more than once a year. In this edition of the PwC Private Business Barometer, businesses again highlighted their concerns in the area of attracting and retaining talent. More than half of businesses indicated they intended to hire in the next six months and 42 per cent reported a lack of qualified staff as a hiring restraint. |  | We spoke to Sue Jackson, Managing Director of Solterbeck, a private business which delivers motivating programs, conferences and events to engage workforces. Interestingly, when we talked to Sue about how Solterbeck finds qualified talent, she said, the company looks for the right fit and then provides training and development. “We tend to hire on how staff engage with our vision, their attitude, and whether they have a complimentary skill set – and then train people in our expertise of performance improvement,” she explained. In the retail sector, e-retailing is growing at 10 per cent per annum – however 39 per cent of respondents told us they had no online retail plans. This area of the market presents a real opportunity for businesses and we believe it should form part of a strong future growth strategy. The PwC Private Business Barometer is just one of the ways PwC Private Clients supports the health and vitality of Australia’s private business community. We hope you find this to be an insightful and useful tool for benchmarking your current performance and outlook for the future. If you would like to talk to me about your business or the findings discussed in this publication, I would love to hear from you. David Wills National Managing Partner |