- Australia’s middle market businesses contribute revenue of $645 billion dollars
- They typically employ from 20 – 200 employees
- Contribute 25% of national total revenue
Pitcher Partners has released its first independent national research report canvassing the trends, challenges and opportunities faced by mid-market businesses across Australia.
As the engine room of our nation’s economy, the middle market employs a quarter of Australia’s workforce, produces almost a quarter of our country’s revenue and contributes a fifth of the national net tax take.
The people who own and operate these privately held businesses are aspirational, energetic, active and have a strong focus on growth. While every business owner and leader has a unique business with its own set of circumstances, they share common challenges.
The research canvassed more than 400 business owners and decision-makers of privately-held and family businesses to find out exactly what it is that makes them tick, what keeps them awake at night, what opportunities they are focused on and what else they need to keep on their radar to ensure their businesses remain successful and their families strong.
Defining the middle market
Australia’s middle-market businesses produce around 25% of national revenue ($645b) and contribute one-fifth of the country’s net tax revenue. They typically employ between 20 and 200 people with an annual revenue between $2 million and $500 million. These metrics classify which businesses fit in this segment, but they aren’t what defines them. They are defined by their distinct attitude – a growth mindset that enables rapid adaptation to capitalise on new opportunities.
Some interesting insights were found across five key themes:
Family business dynamics
Managing the dynamics between family employees and non-family employees is a common strain amongst family-owned businesses. Owning and operating a family business also places increased pressure and strain on family relationships, unless properly managed.
Business owners don’t consider themselves innovators, even though Australia and its businesses are renowned for their innovation. A lot of these business owners and decision-makers have created and developed solutions that they see as part of everyday business. However, they don’t recognise the potential commercial opportunity they present. You don’t need to be the next tech giant to be considered innovative.
Finding the right information
Many business owners and decision-makers are unsure of where to go to access the right information and resources to assist them in driving and realising their growth aspirations. Accessing peer and professional networks as part of strategic thinking can help provide depth and perspective to the process.
Macro versus micro
Respondents have in-depth knowledge of the micro events in their industries and how it may impact their business, but don’t focus as much on the macro. Recent events demonstrate the importance of being aware of and planning how to respond to the macro environment.
Only one-third of respondents have a succession plan even though they recognise the need to be ‘opportunity ready’.