AC TI O N TH E K E Y TO
S U S TAI N A B LE G ROW TH
A NZ O P P O R T U N IT Y A S I A R E P O R T 2 01 6
AUSTRALIAN BUSINESSES:
could gain $138 billion
in revenue from
Asian expansion
with operations
in Asia have a 16%
higher turnover
say doing business in Asia
makes sustainable growth
more achievable
with Asian operations are
planning to further expand
in the next three years
CONTENTS
Foreword2
About this report
4
Executive summary
6
Sustainable growth is within our grasp
10
‘Low growth’ doesn’t need to be the new black 14
Case study: Ambition
18
Getting ready for take off 20
Case study: Transtar
26
Mountains and molehills 28
Case study: Ingredients Plus
32
Stronger, brighter regional Australia
34
Case study: Harcourt Apples 46
Conclusion48
About ANZ 50
Survey demographics 52
FOREWORD
Australian businesses
have an enviable reputation
around the world –
particularly across Asia.
In order for that reputation and level of success to
continue, we want to help more organisations find
opportunities and realise their potential across the
Asian export market.
The ANZ Opportunity Asia report is designed to
do just that. By capturing insights and sentiments
around international growth from companies who
have already made their mark in the Asian Century,
we can increasingly see the size of the prize, as well
as identify the best practices behind how they got
to where they are today.
The size of the prize is significant.
This report identifies that businesses that have
existing operations in Asia have a turnover 16 per
cent higher than those who were domestically
focused. Nearly three quarters of the businesses
we spoke to acknowledge that their profit margins
from the Asian region are higher or comparable
to their domestic profit margins.
That’s good for business.
However, we believe that more Australian businesses
can benefit from all that Asia has to offer. Today,
the level of investment into Asia from Australia,
accounts for close to six per cent of Australia’s
foreign direct investment1.
But this could change.
There are a growing number of Australian companies
planning to do business in Asia2 - almost all of them
plan to do this within three years.
If these plans come to fruition, Australian businesses
could gain $138 billion in revenue, while also taking
their innovations and products to a broader audience.
At ANZ we know growing a business
in Asia is not a set and forget strategy,
but one that needs constant monitoring,
and ongoing adjustments.
1
2
2 | ANZ OPPORTUNIT Y ASIA REPORT 2016
Passing us by, PWC, www.pwc.com.au, August 2015
Australian Bureau of Statistics, abs.com.au
We established our Asian presence more than 40
years ago. We operate in 34 markets, with 10 times
as many bankers on the ground across Asia as our
Australian competitors.
We are continuing to enhance our Institutional
business in Asia to connect our customers
across the region and provide unique local
and industry insights.
Our regional network provides a strong differentiator
based on capabilities in trade foreign exchange,
debt capital markets and cash management.
Whether you already conduct business in Asia,
or you’re considering it, I encourage you to review
the insights in this report and speak to ANZ about
your export goals. We are here to help your
business thrive in Asia, building on your strong
and sustainable capabilities.
Fred Ohlsson
Group Executive, Australia
ANZ
Mark Whelan
Group Executive, Institutional
ANZ
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 3
ABOUT
THIS REPORT
Achieving sustainable
growth domestically
is no small feat.
Australia’s GDP growth is likely to remain under
2.5% and below global trends throughout 2016,
full-time unemployment levels are increasing,
wage growth is plateauing, living costs are high
and business confidence is low.
Companies that are either active or planning to
be active in Asia, believe that they will be better
positioned to achieve long term sustainable growth
and profitability than their counterparts whose
operations remain domestically focused.
Australia’s transitioning economy is leading to
increasing numbers of Australian businesses looking
to growth opportunities in offshore markets – and
expanding into Asia is a logical and potentially
attractive option.
These findings are encouraging for the many
Australian businesses considering their growth
options in Asia and the opportunities they present.
However, there remains a number of consistent
concerns that continue to hold many companies back.
This year we embarked on a similar survey, focusing
on not only capturing sentiments of SMEs doing
business in Asia, but also some of the quantifiable
and tangible benefits.
In 2015, we surveyed more than 1,000 small
to medium enterprises (SMEs), right through
to large corporates to capture their sentiments
about doing business in Asia.
We again surveyed more than 1000 businesses and
have considered responses from businesses with
well-established Asian operations, through
to those who are yet to start their Asian journey.
The results showed that those who
are doing business in or with Asia have
a far brighter and more optimistic
outlook than those who are not.
4 | ANZ OPPORTUNIT Y ASIA REPORT 2016
We know that taking a business across borders is a
big decision.
However with help from the right people with
the experience, ‘know how’ and with the
right connections on the ground, making the
move can be made a lot easier than it may appear.
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 5
EXECUTIVE SUMMARY
ANZ surveyed more than 1,000 Australian businesses to understand
their sentiments on doing business in Asia and the findings revealed:
$138 billion
82%
26%
is what Australian businesses could
gain in revenue from Asian expansion
said that doing business in
Asia is not a ‘set and forget’ strategy
doing business in Asia said they
achieved ROI within 12 months
16%
50%
59%
higher than those who were
domestically focused
said that doing business in Asia
substantially increases their profits
planning Asian expansion
are considering joint ventures
Australian businesses with existing
operations in Asia had a turnover
6 | ANZ OPPORTUNIT Y ASIA REPORT 2016
STAFF
WANTED
57%
55%
57%
said that doing business in Asia makes
sustainable growth far more achievable
said that they recruited additional staff
when they started doing business in Asia
planning on doing business
in Asia are targeting China
65%
with established Asian operations
are planning to further expand
their business dealings
50%
from regional Australia
said they were drawn
to Asia as a result of the
good opportunities
87%
who are planning to embark
on Asian expansion say they
will do so within three years
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 7
62%
75%
from regional Australia
who are doing business
in Asia said they were not
impacted by the downturn
in Asian economies
from the agricultural sector
said they received substantially
larger profits from their
Asian operations than from
their domestic markets
60%
64%
from regional Australia who are doing business
in Asia said that doing business in Asia makes
sustainable growth far more achievable
said that accessing capital for their Asian
expansion was no more challenging than
securing funds for other markets
8 | ANZ OPPORTUNIT Y ASIA REPORT 2016
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 9
SUSTAINABLE
GROWTH IS WITHIN
OUR GRASP
Asia intention
Growth within our grasp
The intention of Australian businesses has never
been clearer. They see valuable growth opportunities
in Asia and they plan to capitalise on them.
Asia is increasingly becoming a popular destination
for Australian businesses seeking to expand and
diversify their operations. Sixty per cent of Australian
businesses in the survey acknowledge that doing
business in the region is attractive for their specific
sector, 57% say that it makes sustainable growth far
more achievable and 50% state that it does or will
substantially increase their profits.
The ANZ Opportunity Asia report shows that on
average, businesses that had existing operations
in Asia had a turnover 16% higher than those that
were domestically focused and 73% of respondents
acknowledged that their profit margins from the
region are higher or comparable to their domestic
profit margins.
73%
said that Asian profit margins
are higher or comparable to
their domestic profit margins
10 | ANZ OPPORTUNIT Y ASIA REPORT 2016
This positive sentiment is helping to drive an increasing
number of Australian businesses to either expand
or embark on doing business with Asia. The report
shows that 65% of businesses with established
Asian operations are planning to further expand their
business operations and 87% of those planning to
embark on their initial Asian expansion say they will
do so within three years.
30%
4%
Exposure to currency exchange rate
fluctuations is a barrier to doing business in Asia
Expand
Establishing business operations or dealings with Asian markets
does not require a very substantial amount of capital
Stay about
the same
Contract
Sentiments: Doing business in Asia
Future of Asian operations
Contract
33%
Stay about
the same
39%
4%
30%
Expand
Asian expansion is a viable option for all businesses
Doing business in / with Asia substantially increases / will
substantially increase our organisation’s profits
I´d like to know more about the benefits of
Free Trade Agreements with Asian countries
My organisation has not been impacted
by the downturn in the China economy
Doing business in / with Asia makes / will make
sustainable growth of our organisation more achievable
Doing business in or with Asia is attractive in our sector
Base: Total sample (n=1,019)
65%
46%
50%
52%
58%
57%
60%
Base: Businesses with established
operations in / with Asia (n=357)
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 11
65%
Likely timing of businesses planning Asian operations
30%
11 or more
years from now
4%
Expand
Expand
Stay about
the same
Stay about
the same
Contract
Contract
In the next
6 – 10 years
1%
0%
4%
2%
9%
In the next
4 – 5 years
4%
9%
30%
65%
56%
In the next
2 – 3 years
51%
31%
In the next
12 months
37%
2016
2015
Base: Businesses planning to establish operations in / with Asia, 2015 (n=203), 2016 (n=240)
12 | ANZ OPPORTUNIT Y ASIA REPORT 2016
The size of the prize
There are a growing number of Australian companies planning to do
business in Asia – almost all of them plan to do this within three years.
If all of these plans come to fruition, Australian businesses could gain
$1383 billion in additional revenue, while also taking their innovations
and products to a broader audience.
Even if only half of these businesses execute against
their plans, the future returns will be significant and provide
a material contribution to Australia’s future prosperity.
Don’t set and forget
Dynamic Asian operation strategies
My organisation has tweaked
or changed strategy numerous
times to ensure success in Asia
Changing economic conditions abroad
meant that we constantly needed
to assess our Asian business strategy
67%
72%
It will be important for us to assess
and monitor, and consequently tweak
and amend our business strategy in Asia
80%
Doing business in Asia is not a set
and forget strategy, it needs constant
reassessment and proactive and
timely changes to strategic direction
82%
Australian businesses expanding into Asia need to be agile and nimble.
Sixty seven percent of Australian businesses surveyed said that they tweaked
or changed their Asia strategy numerous times, while 80% acknowledged
that they were conscious they needed to constantly monitor and assess their
businesses strategy.
Seventy two percent of survey participants with Asian operations said that
changing economic conditions abroad meant that their Asian business strategy
was constantly being reviewed and 82% stated that doing business in Asia was
not a ‘set and forget’ strategy, but one that needed proactive and timely reviews.
3Among businesses that we surveyed that are already doing business in / with Asia, the average revenue derived from
their Asian operations / dealings is $0.58m for small businesses, $4.21m for medium sized businesses and $62.85m for
large sized businesses (as reported by them in the survey). If all of the businesses that are currently considering doing
business in / with Asia moved forward with their plans and achieved similar levels of revenue as those already there,
this would result in around $138 billion of collective revenue p.a. These extrapolations are based on ABS data for the
number of businesses and the revenue estimates provided by the survey respondents currently active in / with Asia.
The estimates were tiered for small, medium and large businesses and then summed.
Base: Businesses with established operations in / with Asia (n=357)
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 13
‘LOW GROWTH’
DOESN’T NEED
TO BE THE
NEW BLACK
Challenging domestic conditions
A move towards Asia couldn’t come at a better time
for many Australian businesses that are navigating
a path through a challenging domestic environment.
Australia’s recent history of economic expansion was
initially a result of opening the economy to global
trade in the 1980s, regulatory reforms in the 1990s,
and the commodities boom in the 2000s.
The impacts on the broader economy of each of
these have slowed and the International Monetary
Fund’s latest forecasts show GDP to remain under
2.5% and below global trends in 2016 before a slight
recovery over the next two years4.
This trend, coupled with rising unemployment
levels, stagnant wages, a higher cost of living and
low business confidence (with a flow on effect on
investments and trade levels) in Australia, has created
an incredibly tough environment for businesses.
4
14 | ANZ OPPORTUNIT Y ASIA REPORT 2016
IMF, www.imf.com, August 2016
43%
said their Asian operations
were driven by good opportunities
and high demand for their products
Drivers of Asian expansion
Free trade agreements /
reduced barriers to trade
We are advertising / marketing /
targeting the region
Import / export / turnover growth
Growth (In general)
Driving change
These challenging conditions mean that Australian businesses are increasingly
looking for other revenue streams – and more and more we are seeing business
owners turning their attention to overseas markets, particularly Asia.
3%
2%
3%
This time last year, 19% of survey participants with existing Asian operations said
a key driver behind offshore expansion was their business’ success and strength
of the industry. It’s most likely that these businesses had a significant operating
surplus and thought it would be worthwhile trying their luck – rather than going
overseas out of necessity.
9%
4%
8%
6%
In 2016 we see significantly different motivators
for those looking to expand their business overseas.
6%
10%
Business / industry is growing /
things are going well currently
19%
The number of businesses in the survey expanding into Asia as a result of strong
business and industry growth has halved – and the number of businesses
driven by anticipated demand for their product or service has almost doubled.
13%
Asia is growing / market is strong
14%
14%
Expansion / investment /
distribution in Asian market
13%
43%
Good opportunities in market /
demand for our product
24%
2016
2015
Base: Businesses with established operations in / with Asia who expect to expand,
2015 (n=235), 2016 (n=234)
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 15
Market entry strategies
There has also been a change in the way Australian
businesses are entering Asian markets.
18%
Mergers and acquisitions
This year 63% of the businesses surveyed have ‘skin in the game’, up from 51%
last year, forming joint ventures (2016: 33% vs 2015: 25%), undertaking mergers
and acquisitions activity (2016: 18% vs 2015: 17%) or embarking on greenfield
investments (2016: 30% vs 2015: 24%).
17%
30%
Greenfield investment
This shift away from traditional trade business (i.e. importing and exporting)
suggests that Australian businesses are getting serious about capitalising on the
opportunities in Asia. Australian businesses are now entrenching themselves
within Asian markets, positioning for greater returns and showcasing a greater
willingness to invest capital, extend ROI and take on complex exit strategies.
24%
33%
Joint ventures
25%
39%
Export to Asian countries
36%
2016
2015
Base: Businesses with established operations in / with Asia, 2015 (n=353), 2016 (n=357)
16 | ANZ OPPORTUNIT Y ASIA REPORT 2016
55%
said they recruited additional staff
when preparing for international expansion
Asian operating costs
Jobs and growth
The increase in the number of Australian businesses investing in building their
Accounting fees
IP protection
levels – and while there is clearly an upside for Asian economies,
the benefits
55%
for Australia are also significant.
We needed to recruit additional staff
7%
We needed to consult extensively
57%
external
resourcesfor cross-border business, 55% of Australian
When itwith
came
to planning
businesses
8%
We
had to
increase
the time spent
(with
Asian
operations)
in the survey said that they recruited additional
staff.
65%
working on the business
In the initial stages of their expansion, this predominantly included hiring staff
in Australia to build capability and manage the process of becoming “Asia Ready”.
15%
Legal fees
18%
Insurance
26%
Information technology
Planning for Asian operations
33%
Marketing and advertising
17%
Logistics, such as supply chain
Other
Accounting
Human
resourcesfees
7%
IP protection
8%
Real estate
There are flow on opportunities of this activity for other industries. The services
sector is a main beneficiary, with increasing demand for professional services,
consultancies, lawyers, recruiters, technology developers and logistics companies
to support the expansion of Australian businesses in Asia.
17%
Real estate
Legal fees
The time taken to focus on growing
37%
our
domestic operations
businesses
in Asia is reduced
having a positive impact on employment
and investment
17%
Other
The time taken to focus on growing
our domestic operations reduced
44%
37%
We needed to recruit additional staff
50%
55%
We needed to consult extensively
with external resources
57%
We had to increase the time spent
working on the business
65%
15%
17%
18%
Insurance
Base: Businesses with established operations in / with Asia, excludes those with
0% of operating costs attributed to Asian activities, ‘Don’t know’ not shown, (n=346)
26%
Information technology
Base: Businesses with established operations in / with Asia (n=357)
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 17
CASE
STUDY
AMBITION
Big plans
Same, same, but different
From inception, Ambition worked smarter,
harder and faster than their competitors.
As all global businesses know, expanding across
borders can be challenging.
Their relentless passion for talent meant they
quickly established a reputation as the go-to
HR firm with in-depth knowledge, expertise
and deep relationships.
The key to Ambition’s success was to truly
appreciate the unique characteristics of each target
market. In each destination they were sure to
fully immerse their business into the local culture
and community and had the utmost respect for
thorough due diligence when it came to navigating
the regulatory and legal environment.
Institutionalising a winning formula
Ambition was founded in
1999 in Australia. True to
its name, from the very get
go the company had big
ambitions to go global and
become the world’s leading
boutique recruiting firm.
Ambition listed on the ASX within 12 months,
opened an office in Hong Kong the following
year and since then has expanded to the
United Kingdom, Singapore and Malaysia.
As a true believer of “not reinventing the wheel”,
Ambition institutionalised their winning
formula and embedded the same structures,
businesses process and operational models
in each new location.
This tactic of promoting best practice consistency
paid off - resulting in increased customer
satisfaction, internal efficiencies and a wellregarded organisational culture and brand.
“
Ambition is a
true believer of not
reinventing the wheel
Diversity is key
Ambition’s passion for talent not only relates
to the work they do recruiting for their clients,
it extends to the people they hire and train.
While expanding into new countries, Ambition
was selective in appointing in-country leadership
that had the right experience on the ground in
that chosen market.
They also hired the majority of their employees
locally and implemented graduate programs
to not only teach staff the trade, but to teach and
embed Ambition’s culture and vision.
Management were focused on continually
upskilling and providing new experiences for staff
and as a result, in each market Ambition has a
cohort of budding new local leaders in the wings
ready for succession.
This constant presence allowed leaders to have
holistic visibility of how the new entity was
travelling – which was incredibly beneficial when
market conditions became extremely challenging.
Leaders quickly and accurately came to the decision
that market entry was going to take longer than
originally anticipated, and this responsiveness meant
that Ambition could swiftly redirect investments
to existing markets thereby mitigating risk.
Strength to strength
“
Leaders expect big things
from emerging markets
over the next decade,
especially in Asia
From this day, the company continues to go
from strength to strength and has significant
growth aspirations.
Australia currently accounts for 70% of Ambition’s
operations, but leaders expect big things from
emerging markets over the next decade,
especially in Asia.
Testing the water
The future is bright for Ambition.
In 2014, Ambition made a move into Tokyo and
as a result of their strong belief that you can’t
run an international business by remote control,
leaders were always on the ground while
trying to establish operations.
Their unique business model and their diligent and
thoughtful approach to international expansion
means that they will be in high demand by clients
across the world for many years to come.
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 19
GETTING READY
FOR TAKE OFF
Championing diversity
In the business community, the spotlight has been on
gender diversity for more than two decades – with
corporate Australia making significant strides towards
achieving gender equality. A growing number of
women are taking leadership roles at universities,
in workplaces, in boardrooms and in government,
delivering stronger business outcomes, diversity
of thought and forging pathways for other women
and girls to follow.
Gender equality will continue to be
an important issue, as will ensuring
our society and business communities
foster and embrace diversity in all its
forms, including cultural diversity.
59%
said that being more culturally diverse
would better position them for success
when it came to Asian expansion
The GDP throughout Asia is expected to more than
double to US$67 trillion by 2030, exceeding that
projected for the Americas and Europe combined
and to successfully unlock these opportunities,
Australia will have to raise the bar on developing
and retaining Asian capabilities5.
5
6
20 | ANZ OPPORTUNIT Y ASIA REPORT 2016
Australian in the Asian Century, http://www.defence.gov.au/whitepaper/2013/docs/australia_in_the_asian_century_white_paper.pdf
Diversity Council of Australia, https://www.dca.org.au/dca-research/cracking-the-cultural-ceiling.html, August 2016
Culture matters – Australia has a long way to go
While 9.3% of the Australian labour force is Asian
born, only 4.9% make it to senior executive level and
across the ASX 200, only 1.9% of executives have Asian
cultural origins6.
Our survey shows a similar story, while pleasingly
72% of businesses said they had female representation
at leadership or board level, only 51% could say this
was true for different cultural representation.
Despite 59% of surveyed businesses acknowledging
that being more culturally diverse would better
position them for success when it came to
international expansion, only 45% said they were
strategically recruiting to achieve better cultural
diversity ratios to support business outcomes.
Diversity
Having more female representation
at leadership or board level would
make us more successful
We strategically recruit culturally
diverse leaders to assist in reaching
our business goals
Our leadership or board
is culturally diverse
Having a more culturally diverse
leadership or board would make us
more successful doing business in Asia
Our business growth aspirations are
supported by being culturally diverse
Our business has female representation
at leadership or board level
43%
45%
51%
59%
63%
72%
Base: Total sample (n=1,019)
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 21
Destination China
Destination Asia
69%
The survey shows China remains the key market
of interest for Australian businesses with existing
operations in Asia and also for those who are
planning their expansion.
65%
57%
Despite a slow down in China’s GDP growth, strong
double-digit growth in Chinese consumer spending
is attractive for many Australian businesses7.
52%
Chinese household income is estimated at $5 trillion8,
which is approximately three times Australia’s GDP
and the country’s transition to more consumption
growth has opened up significant opportunities
for Australian businesses.
The recently signed China-Australia Free Trade
Agreement is also a game changer for Australian
businesses from financial services to aged care
industries and there are many niche areas of
export opportunity such as honey, pearls, nuts,
rock lobster and various fruit juices.
41%
40%
39%
34%
33%
32%
22%
20%
18%
The rise of China, KPMG, August 2016
McKinsey & Company, http://www.mckinsey.com/, August 2016
22 | ANZ OPPORTUNIT Y ASIA REPORT 2016
30%
26%
22%
19%
14%
Planning 2016
8
24%25%
23%
28%
27% 26%
19%
16%
12%
South Korea
7
22%22%
27% 27%
25%
36%
34% 34%
13%
India
Thailand
Planning 2015
Japan
Indonesia
Active 2016
Malaysia
Hong Kong
Singapore
China
Active 2015
Base: Businesses with established operations in/with Asia, 2015 (n=353), 2016 (n=357); Businesses planning to establish operations in / with
Asia, 2015 (n=203), 2016 (n=240). Note: Top 9 countries amongst businesses with established operations in / with Asia shown
Game changers
20%
said that having the right knowledge
was the key success factor to
doing business in Asia
Last year 18% of surveyed participants with Asian
operations said that having a product or service
that was in high demand underpinned their success.
However sentiments have changed in 2016.
Possessing “knowledge” was the number one driver
of building a successful business in Asia, closely
followed by having good relationships with partners
and customers.
Knowledge is king
Knowledge is the ultimate competitive advantage
when it comes to international business. Markets
throughout Asia vary greatly from country to country.
They can be volatile and are always evolving,
and Australian businesses need to think beyond
traditional business models if they want to succeed.
Partnering for success
Having the right local partner
on the ground with the right market
insight is a great way to execute
a business plan.
Businesses should look for partners who can help
navigate bureaucracy, red tape and cultural nuances.
Building robust and solid relationships with customers
is equally important. In order to successfully connect
with target markets, businesses need to understand
the cultural context in which their customers are based.
Businesses need to be able to anticipate market
trends and competitor behaviour.
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 23
Key success drivers of Asian operations
2%
Australian reputation / banking
/ industry efforts
4%
2%
Cheap / low cost product
Marketing / advertising
65%
5%
4%
1%
4%
Cheaper costs
(e.g. services, labour, equipment)
6%
4%
Hard work / honest dealings
6%
5%
Clear business model / direction / KPIs
said they were doing
business in China
2%
6%
Local management / personnel / presence
11%
6%
Favourable economic conditions
(e.g. market / industry growth industry)
5%
Communication (e.g. knowing the
language, good translator)
8%
6%
9%
Good contacts / partners
(i.e. knowing the right people)
12%
11%
Good management / the right personnel
8%
14%
In demand / high quality product or service
18%
19%
Good relationships with partners / customers
16%
20%
Knowledge
14%
2016
2015
Base: Businesses with established operations in / with Asia, 2015 (n=353), 2016 (n=357)
24 | ANZ OPPORTUNIT Y ASIA REPORT 2016
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 25
CASE
STUDY
T R A N S TA R
Freight and logistics
company Transtar was
founded in Australia in 1986
by Hank Meyer who may
have started humbly, but had
a big vision for the future.
The future is bright
Growth agenda
“We knew from the get-go that Asia was not
only going to be our ticket to long term success,
but also for our Australian customers.
As their clients grew, so did the opportunities
for Transtar.
As more and more Australian businesses started
to do business with Asia, we knew we could add
value and support them with the complexities
and challenges in doing cross-border business”,
said Mr Meyer.
Innovation ideologies
It is evident that the company prides itself
on doing more than just servicing their clients.
David Morris, Transtar Finance and Strategy
Director was drawn to the company for its passion
for innovation.
“I love that Transtar forms partnerships
with each and every one of our customers.
As a growing innovative company, we want the
ability to grow and innovate with like-minded
businesses. Our relationship with our customers
is truly unique. We not only help them to prosper
by streamlining logistics and supply chains –
we help them reinvent business operations”,
said Mr Morris.
Their operations went from strength to strength and
today they have a robust presence around the globe
with headquarters in Melbourne and Hong Kong,
and a network of 18 offices located throughout Asia,
Australia, New Zealand and Europe.
“Our significant growth for the last three decades
can largely be attributed to our unique service
offering. We have a fully integrated business
model where our people and facilities can control
and manage cargo movements across the entire
supply chain – we go way beyond port-to-port;
we can take you door-to-door”, said Mr Meyer.
Value add
Over the last five years Transtar opened for business
in nine new markets across Asia, including Ningbo,
Qingdao, Singapore, Bangkok and Kuala Lumpur
– however their aspirations don’t stop there.
“Our vision is to be the leading provider of freight
and logistics services in the Asia-Pacific market.
And we can do this by continuing to eliminate
third parties from our business, removing cost
from supply chains, improving processes and
delivering a real competitive advantage to our
customers”, said Mr Morris.
And if industry recognition is anything to go by,
Transtar is surely on the right track to reach their goal.
Last year Transtar won the Business Excellence Award
for Business Services at the Australia China Business
Awards and was awarded Freight Forwarder of
the Year in 2013. Transtar also continues to climb
IBISWorld’s Top 500 Private Businesses list.
Digital leaders
Transtar continues to raise the bar in the way
they service their customers, not only in regards
to core freight forwarding services, but also
around cutting edge technology that they have
pioneered to make it easier to track and manage
the movement of goods.
“The release of e-STAR was extremely well received
by our customer base. It offers real-time shipment
visibility, with mobile, web and app compatibility.
We were the first to market with this service and
we will continually look for new ways to improve
business for our customers”, said Mr Morris.
People are key
The key to Transtar’s success was not a stroke
of luck, it has been the result of careful and
meticulous planning and smart tactical moves.
“
Our recruitment strategy to
build a robust Asian workforce,
which is predominately female,
has undoubtedly been a key
success factor
“Getting things from point A to point B in Asia can
be complex – especially if you don’t know the
market, the regulatory and customary hurdles – so
hiring local talent is absolutely fundamental for us.
We have also implemented reward and
recognition programs for our people. This has
led to high employee satisfaction and in turn
high retention levels.
Each year we take some of our highest performers to
our Melbourne headquarters and show them exactly
what business, life and our Transtar culture is like in
Australia. This has had a tremendous impact on
our offshore locations as they go back to their local
office and share their learnings and experience”,
said Mr Meyer.
The opportunity is up for grabs
Given Transtar’s unique service offerings, bolstered
by its people, culture and innovative approach, it’s
no wonder they have a large and diverse customer
base, including long-term relationships with blue
chip retail, wholesale and industrial companies.
However, the flow of trade is largely in-bound
from Asia with Australian companies capitalizing
on the ability to import low cost, high quality
goods, to sell on to our population of 23 million.
“I do think more Australian companies should be
looking at Asia as an opportunity to increase sales
and reach revenue targets – just as we did. There
is no doubt that it can be challenging, but if you
partner with the right people and make sure you
structure your organisation to succeed, the gains
could be significant”, said Mr Meyer.
The Board of Directors have strategically established
operations in 10 out of 12 of the world’s top
container ports and now have over 70% of their
work force on the ground in Asia.
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 27
MOUNTAINS
AND MOLEHILLS
Preconceptions
There is no denying that growing a business
internationally is hard work. However, many
Australian businesses consider Asian markets
to be much tougher and more challenging than
more familiar markets.
All businesses face challenges when
growing across borders, irrespective
of which market they are targeting.
Doing business in Asia is the same or easier
than in other markets
Access to capital funding
Finding on-the-ground partners
57%
Marketing
56%
Setting up e-commerce solutions
Sixty per cent of businesses surveyed said that
accessing capital for their Asian expansion was no
different than securing funds for other markets –
while 57%, 63% and 56% said that the challenge
of predicting demand, mastering eCommerce and
deploying marketing strategies in Asia respectively,
was on par with other international experiences.
Base: Total sample (n=1,019)
28 | ANZ OPPORTUNIT Y ASIA REPORT 2016
52%
Predicting demand for
products and services
Access to local knowledge
Our report suggests that doing business in
Asia is comparable to, and in some cases more
straight forward, than it would be to seek
growth in other markets.
60%
54%
63%
Looking for growth in the wrong places
Despite the many opportunities, the preconception that doing business
in Asia is too challenging is hindering the number of Australian businesses
expanding to Asia.
The total value of outward investment from Australia was more than $2.1 trillion
at the end of 2015, with the United States and the United Kingdom being
the two largest recipients9.
You’ve got this
Australian businesses who participated in our survey have embarked on their
Asian strategy with relative ease. Seventy one per cent had no issues with
securing appropriate levels of funding and 64% said that they had no difficulties
in developing the right Asian strategy for their business to succeed.
Asian capital requirement expectations vs reality
Less
6%
7%
57%
In line with
expectations
59%
29%
Greater
28%
2016
2015
Sixty four per cent of businesses said the capital requirements for their Asia
expansion were lower or in line with their expectations, while 61% achieved
positive ROI within three years.
9
DFAT, www.dfat.gov.au, August 2016
Base: Businesses with established operations in / with Asia, ‘Don’t know’ not shown,
2015 (n=353), 2016 (n=357)
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 29
30 | ANZ OPPORTUNIT Y ASIA REPORT 2016
A helping hand
For a country like Australia, foreign investment is critical for supporting economic
development and sustainable growth.
Given Asia’s proximity and the growing wealth and investment capability across
the business community, it would seem logical and realistic that Australian
businesses would look to partner with investors from the region – however
there seems to be significant reluctance.
Eighty seven per cent of Australian businesses surveyed
say they do not receive funds from international investors,
and a further 83% said they would not look to do
so in the future.
Partnering with Asian counterparts
Receiving investment from an
international organisation
Seeking a joint venture arrangement in
Australia with an international organisation
Seeking new investment from an
international organisation
Participating in a joint venture arrangement in
Australia with an international organisation
13%
16%
17%
18%
Of those businesses that remain domestically focused, the willingness to
collaborate with international counterparts to drive sustainable growth remains
low. Eighty two per cent said they are not currently participating in a joint venture
with an international organisation and 84% said they wouldn’t be seeking to
embark on a partnership in the future.
Base: ‘Don’t know’ not shown, Total sample (n=1,019)
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 31
CASE
STUDY
INGREDIENTS
PLUS
Ingredients Plus was
founded in Australia in
2005 but it wasn’t long
before they had opened
offices right across Asia.
An importer and distributor of specialty raw
materials for the personal care and pharmaceutical
industries, Ingredients Plus’ early expansion into
China was opportunistic.
CEO Graeme Love’s previous experience in the
industry and in key Asian markets gave his new
venture all-important contacts, and within a year
he was fielding calls from Chinese companies
keen to collaborate.
He quickly realised that an Asian regional presence
would position Ingredients Plus at an advantage
to their competitors in terms of sourcing materials
from local suppliers. And with pharmaceutical
companies increasingly shifting their manufacturing
into Asia, Ingredients Plus knew that a regional
presence would allow them to service a growing
number of key multinational buyers.
“China’s important to us because it’s important
to our buyers – having an office there put us on
their radar. Without it, we wouldn’t be talking
to the buyers that we are”, said Mr Love.
Protecting the home ground
Mr Love believes that if it wasn’t for their Asian
operations, the Australian business would not
be where it is today. The offices across Asia
crucially allow Ingredients Plus to supply a larger
number of global buyers across multiple markets.
“In Australia, you’re very exposed to factors
outside your control, but having the offshore
presence gives us a seat at the table with the
best buyers and cushions our Australian
business as well”, said Mr Love.
Big fish in a small pond
It wasn’t long before Ingredients Plus realised
they were taking on some of the giants within the
global industry.
“In Australia, one container goes to 20 customers,
but in Asia we’re selling 20 containers to a single
customer – the scale is massive”, said Mr Love.
While the size of the opportunity in Asia is impressive,
it is essential to approach any expansion with a clear
plan and ensure that you do your research.
Ingredients Plus has always been conscious of
recognising what they could afford to put into
each offshore office without affecting their
domestic business in Australia.
Growth isn’t always easy
Ingredients Plus’ original expansion into China has
now led to a network of offices across 10 countries
with around 50% of group revenue attributable
to the Asian offices.
But it’s important to note that growth of this
magnitude has not been straight forward or
without challenges.
While the offshore offices are significant revenue
drivers, margins on contracts can be considerably
lower, so there is pressure to move volume.
Mr Love’s advice to other Australian companies
looking to take advantage of opportunities in
Asia is to start out gently and to be clear on your
own business’ risk and investment appetite before
starting out.
People are key
Mr Love’s other key learning is around the
importance of recruiting and retaining talented
management personnel.
Mr Love notes that for Ingredients Plus,
identifying key target markets has been the easy
part, however getting the right people has been
a more time consuming and challenging process.
“We simply won’t embark on expanding into
a new country or opening a new office until
we’ve found the right people”, said Mr Love.
And when it comes to retaining talent, Ingredients
Plus has found that offering a small stake in the
business to local management has allowed them
to keep staff within their overseas offices – and it’s
this consistency and high quality talent that has
largely led to their success.
Strength to strength
“
In Australia, one container
goes to 20 customers, but in
Asia we’re selling 20 containers
to a single customer – the scale
is massive
There are big plans in the pipeline for Ingredients
Plus and it’s expected that their offshore
operations will only grow more important to the
overall company’s success.
Mr Love expects that offshore revenue will
increase from 50% to around 60% or even
higher over the next five years.
“I honestly believe that the future looks bright
for this great Australian company on the world
stage. Our long term plan is to continue capitalising
on our Asian regional strategy, while sustaining and
protecting our domestic operations”, said Mr Love.
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 33
STRONGER,
BRIGHTER
REGIONAL
AUSTRALIA
On the rise
While representing a relatively small proportion of
Australia’s total exports, exports from regional areas
to Asia have increased by more than 85% over the
last eight years, far outpacing that from metro areas10.
This trend is likely to continue.
Forecasts are showing that the majority of our export
growth over the next decade will originate in regional
Australia11 and the agricultural sector has a significant
role to play.
The growing middle class in Asia and their ever
increasing demand for clean, green and high quality
food sources, means that Australian agricultural
produce is and will continue to be in high demand.
Australian agricultural producers are in a prime position
to supply Asia’s growing demand for quality food,
and it’s not surprising therefore that 89% of agribusiness
survey participants said that doing business in Asia
was an attractive option for their sector.
10
11
34 | ANZ OPPORTUNIT Y ASIA REPORT 2016
The Regional Institute of Australia, The Rise of Asia, August 2016
The Regional Institute of Australia, The Rise of Asia, August 2016
89%
of agribusiness survey participants
said that doing business in Asia was
an attractive option for their sector
Key drivers of Asian expansion
3%
We are advertising / marketing /
targeting the region
0%
3%
Growth (In general)
Business / industry is growing /
things are going well currently
Asia is growing / market is strong
Asia is growing /
market is strong
In comparison to other sectors, more agribusinesses
are doing business with Asia.
7%
Free trade agreements /
reduced barriers to trade
Import / export / turnover growth
It’s all coming up agribusinesses
And while they are not only more likely to engage
in off-shore operations, agribusinesses are also driving
sustainably larger returns from their Asian operations
than from domestic markets (Agriculture: 70% vs
Other industries: 50%) and are more optimistic about
achieving sustainable growth (Agriculture: 76% vs
Other industries: 57%).
8%
4%
3%
6%
3%
The majority of our agribusiness survey participants
also said that their success in Asia was a result of
growing demand, with 69% acknowledging their
produce was highly sought-after (compared to only
43% from other industries).
10%
8%
13%
6%
14%
69%
Good opportunities in market /
demand for our product
43%
Agriculture
All industries
Base: Businesses with established operations in / with Asia who expect to expand,
All industries (n=234), Agri (n=38)
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 35
Regional rules
Optimism towards Asia and the opportunities
it presents is growing in regional Australia.
Fifty per cent of regional Australian businesses
participating in the survey said that they were
drawn to Asia as a result of good opportunities,
compared to 42% of their metro peers.
Sixty six per cent of regional survey participants
also said that they plan to expand their business
in Asia and nearly two thirds of regional businesses
doing business in Asia said they were not
impacted by the slow down in some economies.
36 | ANZ OPPORTUNIT Y ASIA REPORT 2016
Key success factors of Asia operations
9%
Local management /
personnel / presence
Favourable economic conditions
69%
None of these
5%
3%
Receiving investment from
an international organisation
7%
53%
6%
16%
13%
Communication
7%
6%
Good contacts / partners
Good management /
the right personnel
Collaboration with Asian Investors
9%
3%
12%
15%
14%
In demand / high quality
product or service
22%
Good relationships with
partners / customers
18%
Seeking a joint venture
arrangement in Australia with
an international organisation
11%
Seeking new investment from
an international organisation
11%
Participating in a joint venture
arrangement in Australia with
an international organisation
18%
20%
13%
20%
Regional
Metro
10%
Knowledge
22%
Regional
Metro
Base: Businesses with established operations in / with Asia; Metro (n=273),
Regional (n=84)
Base: ‘Don’t know’ not shown, Metro (n=695), Regional (n=324)
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 37
Doing business in Asia is the same or easier than other offshore markets
When it comes to the key factors underpinning success in Asia, regional
businesses were half as likely to value “knowledge” of the local market
conditions and culture (regional businesses: 10% vs metro businesses: 22%).
44%
Finding on-the-ground partners
55%
They did however place more importance on having good relationships
with partners (regional businesses: 22% vs metro businesses: 18%) and having
a product or produce that was in high demand (regional businesses:
15% vs metro businesses: 14%).
52%
54%
Access to local knowledge
54%
57%
Marketing
52%
Predicting demand for
products and services
58%
58%
61%
Access to capital funding
62%
64%
Setting up e-commerce solutions
Regional
Base: Metro (n=695). Regional (n=324)
38 | ANZ OPPORTUNIT Y ASIA REPORT 2016
Metro
Driving success
While product demand and good relationships with partners are important
factors, acquiring the right level of understanding of target markets should
not be underestimated.
ANZ’s Asian Delegation programs bring together
groups of industry participants for a focused week
of market insights.
The program aims to develop industry participants’
knowledge of trade opportunities, deepen their
understanding and appreciation of global food supply
chain and provide them with a first hand opportunity
to experience business, life and culture in key markets
in Asia.
Importantly, participants spend time meeting with
local producers and industry players, gaining practical
knowledge on how to do business in specific Asian
markets, and making vital connections to support
their international ambitions.
Our most recent delegations have focused on protein
(beef and chicken) and grain (wheat and barley) and have
explored markets in Vietnam, China and Hong Kong.
In which Asian countries does your organisation currently have business operations
27%
25%
Japan
28%
28%
Indonesia
17%
Malaysia
34%
27%
Hong Kong
36%
28%
Singapore
40%
70%
China
65%
Agriculture
All industries
Base: Businesses with established operations in / with Asia; All industries (n=357), Agri (n=60)
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 39
Sentiments about doing business in Asia
28%
Establishing business operations or dealings with Asian
markets does not require a very substantial capital investment
35%
32%
Exposure to currency exchange rate fluctuations is a barrier
to our organisation doing / doing more business in / with Asia
41%
46%
46%
Asian expansion is a viable option for all businesses
44%
Doing business in / with Asia substantially increases / will
substantially increase our organisation’s profits
53%
47%
I´d like to know more about how the Free Trade Agreements
with Asian countries could greater benefit my business
54%
62%
My organisation has not been impacted
by the downturn in the China economy
57%
47%
Doing business in / with Asia makes / will make
sustainable growth of our organisation more achievable
60%
51%
Doing business in or with Asia is attractive in our sector
63%
Regional
Base: Metro (n=695), Regional (n=324)
40 | ANZ OPPORTUNIT Y ASIA REPORT 2016
Metro
Like a bull in a China shop
As the largest food importer in the world, it is not
surprising that China is the top destination for Australian
regional businesses participating in the survey,
with 76% saying it was their number one target market.
China was also the top destination for
agribusinesses, with 70% already doing
business there and 64% saying they
have plans to start operations there.
According to the Chinese Bureau of Statistics, the
average annual growth rate of food and beverage
imports in China is forecast to increase by 20% p.a
until the end of the decade12.
Future plans for Asian operations
1%
Regional
34%
66%
5%
Metro
30%
65%
Contract
Stay about the same
How does the level of profit margin from your Asian operations
compare to your profit margins from Australian based activities?
30%
All
industries
43%
33%
Agri
42%
The same
12
Chinese Burearu of Statistics, http://www.stats.gov.cn/english/, August 2016
Expand
Higher
Base (above): Businesses with established operations in / with Asia (n=357)
Base (below): Businesses with established operations in / with Asia, All industries (n=357), Agri (n=60)
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 41
The need to size and scale
Asia is home to 60% of the world’s population and cities
throughout the region are transforming faster than
ever, with populations doubling in the last 10 years13.
The opportunities are significant and
if Australian regional businesses want
to secure a larger piece of the Asian pie,
they will need to start considering
how to size and scale their operations.
In order for regional businesses to increase their
capacity and cater for growing offshore demand,
they will need investment and potentially need
to consider different funding options or models.
Fifty four per cent of regional businesses participating
in the survey said that logistics and supply
chain expenses were their largest operating costs,
compared to only 36% of their metro peers.
13
42 | ANZ OPPORTUNIT Y ASIA REPORT 2016
The organisation for Economic Co-operation and Development, www.oced.com
However, the report also shows that regional
businesses, especially those in the agricultural sector,
are more likely to use their personal funds to support
their offshore business, and much less likely to
have appetite to partner with international investors.
In fact, 87% of regional businesses said they would
not participate in a joint venture with an international
organisation and 89% said they would not seek
new investments from an offshore partner.
Despite regional businesses being twice as likely
to seek Government and industry grants as other
sectors, only 13% said it was a source of capital.
Last year only 9% of survey participants said they
would look to government for support when
it came to doing business in Asia but this year
47% of regional survey participants with established
offshore operations said they wanted to know
more about how their business could benefit
from Free Trade Agreements.
Top three outlay for Asian business operations
7%
Legal fees
15%
6%
Real estate
17%
12%
Insurance
18%
9%
Information
technology
26%
Marketing and
advertising
31%
33%
50%
Logistics, such as
supply chain
44%
46%
50%
Human resources,
such as hiring employees
Agriculture
All industries
Base: Businesses with established operations in / with Asia, All industries (n=357), Agri (n=57)
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 43
Key drivers of Asian expansion
Business/industry is growing/
things are going well currently
Asia is growing/market is strong
Expansion/investment/
distribution in Asian market
Drivers of Asian operations
3%
Don’t know
10%
8%
Other
13%
6%
Perceived ease
of doing business
14%
Good opportunities in market/
demand for our product
69%
43%
Agriculture
All industries
Success of similar businesses
1%
2%
8%
7%
13%
8%
11%
8%
18%
18%
Operating cost savings
24%
Existing business relationships
24%
Regional
Base: Businesses with established operations in/with Asia who expect to expand,
All industries (n=234), Agri (n=38)
44 | ANZ OPPORTUNIT Y ASIA REPORT 2016
26%
28%
35%
Existing or expected demand
Metro
Base: Businesses with established operations in / with Asia; Metro (n=273),
Regional (n=84)
29%
Lean on me
When it comes to selecting Asian target markets,
24% of regional businesses said that they choose
countries where they have existing business
relationships (compared to 29% of their metro peers).
Metro based businesses who participated in the survey
were also more likely to determine the location of
their Asian business based on the existing or expected
demand for their products. They also considered
the success of other similar companies in the market.
These differences in planning offshore market entry
are likely the result of differing perceptions around the
ease of doing business in Asia.
Regional businesses found it more challenging to
find on-the-ground partners, predict demand for
their products or services, and access local knowledge,
and are therefore more likely to consider markets
where they have existing connections.
Funding Asian operations
Government assistance such as
export grant etc.
16%
13%
7%
39%
Personal funds
27%
13%
23%
15%
18%
Private equity or investors
Bank funding overseas
7%
9%
20%
66%
37%
38%
Bank funding in Australia
46%
50%
42%
Operating surplus
Agriculture
Regional
Metro
Base: Businesses with established operations in / with Asia; Agri (n=57), Metro (n=265), Regional (n=81)
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 45
CASE
STUDY
HARCOURT
APPLES
When Simon and Vicki Frost
bought a small apple juicing
business near Harcourt in
2002, they had no idea that
they would soon become
an international supplier of
natural fruit juices products,
sparkling juices, ciders
and cider vinegars.
Investing where it counts
were just around the corner.
Simon and Vicki Frost realised quite quickly
that in order to grow the business they would
need to invest.
Going global
So that’s what they did. They invested in a new
and improved production facility and worked
hard to extend their product line to include a
huge range of products all based around apples
and pears that were available locally. This not only
benefited Harcourt Apples but also gave local
farmers a market for their second grade fruit that
was wasted in the past.
And the decision paid off for Harcourt Apples.
Big time.
The efficiency improvements in production
allowed the business to increase their supply and
cater for the growing demand for their products.
Seeing results
In fact, soon after the upgrades they began
to do deals with large domestic retailers,
extending their product reach across the nation.
This was a great result for the Frosts and they
were pleased with the rate of growth within
the business.
But little did they know that global opportunities
“It seems silly now, but exporting our products,
especially to Asia was never a part of our plan.
When we were approached directly by a Chinese
buyer who was interested in our cider products,
we were truly shocked”, said Mr Frost.
Similarly, not long after Harcourt’s discussion with
China, they were once again approached by an Asian
buyer, but this time a Malaysian group of pharmacies.
“A Malaysian pharmacy group sent us an email,
enquiring about our apple cider vinegar products
as there is a growing demand world-wide due
to the health benefits of apple cider vinegar.
They didn’t believe us at first that our products
were 100% natural, but once we showed
them how it was made, they quickly started
negotiations”, said Mr Frost.
“
There is tremendous
opportunity for all
Australian producers of
fresh, clean agri products
Crossing ‘t’s and dotting ‘i’s
Harcourt Apples took a diligent and careful
approach when it came to dipping their toe in
the Chinese market.
Five years ago they embarked on a couple of
small contracts with the Hong Kong Jockey Club,
however since that time their footprint has grown
substantially, and the future outlook is bright.
More recently, the negotiations with the Malaysian
pharmacy group have come to fruition. Harcourt
Apples now export white-labelled apple cider
vinegar products, which are repackaged and
relabelled in Kuala Lumpur and available in
more than 30 pharmacies.
The future is bright
“We do see huge potential for our business in
China and Malaysia, and throughout Asia more
broadly. In fact I think there is tremendous
opportunity for all Australian producers of fresh,
clean agri products”, said Mr Frost.
“Believe it or not, once we started to scale our
operations, finding a local supplier who could
provide the number of glass bottles we required
at an affordable cost was tough. That’s when we
started to expand our thinking. If we’re selling
in Asia, why can’t we manufacture there too”,
said Mr Frost.
This part of the business is in the early phase for
Harcourt Apples but they will pursue looking for
JV opportunities, especially with partners with
robust distribution connections to really take the
business to the next level.
“Pardon the pun but it’s apples and oranges –
if we hadn’t been brave enough to take our
business global we would be in a completely
different position to where we are today”,
said Mr Frost.
It terms of opportunities abroad, not only is
the increasing volume of exports changing the
business trajectory for Harcourt Apples, but so
is the potential to manufacture or source high
quality, low cost goods that are involved in
production such as glass bottles and jars.
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 47
CONCLUSION
The ANZ Opportunity Asia
report shows that Australian
businesses that are doing
business in Asia are far more
profitable and have better
growth prospects than their
domestically focused peers.
48 | ANZ OPPORTUNIT Y ASIA REPORT 2016
Businesses in regional Australia, especially in the
agricultural sector were a standout – with a significant
proportion exporting produce to Asian markets and
many with plans to ramp up their capacity to expand
on their off-shore operations.
The majority of Australian businesses who participated
in the report said they accessed capital for their
offshore development with relative ease and that
doing business in Asia was no more challenging than
growing in other offshore markets.
Nearly all businesses who were doing business in
Asia acknowledged that they need to constantly
monitor their business strategy to navigate dynamic
market conditions. However, overall there was
consensus that businesses generally were benefiting
from the multitude of opportunities as a result of the
speed and size of growth across Asian economies.
In many cases they hired additional staff, with
many saying their profit margins and overall returns
increased significantly.
The report also reveals that a growing number
of companies are planning to do business in Asia,
which will have a positive flow on impact for the
Australian economy.
The key to success for those starting their Asian
journey will be accessing and maintaining the right
‘Asian capabilities’ and recalibrating risk appetite so
as to reap the rewards.
CONTACT US
ANZ International
Business Development
E: [email protected]
W: anz.com
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 49
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Our dedicated Australian desks in seven major
markets provide you with expert banking and
business advice. No matter where you want to grow,
you’ll have access to someone on the ground, who
knows the market, understands your business and
speaks your language.
Our unique trade desk supports more than
1,000 customers every month, and can help
you to make better informed decisions, giving
you trading confidence.
Our regional network provides a strong differentiator
based on capabilities in trade foreign exchange,
debt capital markets and cash management.
Our dedicated international on-boarding team
makes the experience seamless and helps you
to get your business up and running faster.
Experience you can trust
We have been building our presence in Asia
for more than 40 years and we are the largest
Australian bank in the region.
We are recognised as the best placed bank to support
Australian businesses with their international needs14.
We discuss international growth plans with
Australian businesses every month and actively
support thousands of businesses to grow across
borders each year.
We invest in our people, so we can serve you
better. More than 400 of our Bankers have joined
our Asia Delegation Program, gaining insight
and the ‘know how’ to better support you.
14
50 | ANZ OPPORTUNIT Y ASIA REPORT 2016
DBM, Peter Lee
ANZ OPPORTUNIT Y ASIA REPORT 2016 | 51
SURVEY DEMOGRAPHICS
Audiences
Sample Profile
Sample size
(unweighted) #
Percentage of sample
(weighted) %
1,019
100
Activities
357
35
Planners
240
20
Potentials
422
45
Small $250k-$4.9m
459
37
Medium $5m-$39m
328
39
Large $40m+
323
24
Activities
60
2
Planners
44
1
Potentials
18
1
NSW / ACT
328
34
VIC
289
29
QLD
174
17
WA
85
8
SA / NT
108
9
TAS
35
3
Activities
Already have operations or
business dealings with Asia
Planners
Total
Segment
Considering operations or
business dealings with Asia
Potentials
Not considering operations
or business dealings with Asia
Business size
(by annual turnover)
Sector deep dive:
Agribusiness
(Agriculture,
forestry & fishing)
State
52 | ANZ OPPORTUNIT Y ASIA REPORT 2016
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