KPMG has surveyed Australian businesses on the stage they believe their business is at following the COVID-19 pandemic, providing media brands insight into which company types are best to approach with marketing opportunities, and the business challenges that they are facing.
KPMG surveyed 225 Australian businesses and found that nearly four in five mid-market companies are confident of their ability to bounce back from the COVID-19 crisis, with the majority believing that they could be back to business as usual within three months.
The survey results are useful to media and magazine publisher sales teams in determining which companies are the best sales prospects over the coming months. As media sales expert Ryan Dohrn says, it is useful to adapt sales approaches to the company type and attitude, particularly when selling in a changed economic environment.
Australian businesses getting back on track
The KPMG survey, carried out in May, found that 94 per cent of business leaders said that the crisis had impacted their business, 52 per cent of which said that the impact was ‘significant’.
Notably, KPMG found that businesses with 50-499 employees were less likely to be concerned than larger companies. Nearly two-thirds of companies in the next category up (500+ employees and/or $500m+ turnover) said they had been significantly impacted.
Yet despite their lesser concern, smaller businesses were more likely to consider themselves still in the early response phase or managing through the crisis.
Of larger businesses, 32 per cent now reported being in the recovery phase, resetting and identifying market opportunities, and adapting to the new world.
KPMG National Leader – Mid-Market Kristina Kipper said “It is very encouraging that almost 80 per cent of respondents said they were confident of their organisations’ ability to bounce back financially from the COVID-19 crisis. There is no doubt it has hit them hard, but more than half believed they could be back up and fully running within three months of the end of the crisis.
“While the very smallest businesses, with less than 50 employees, were not so confident, the next bracket (50-499), which is the backbone of the Australian economy, were more upbeat.
“Of course the crisis won’t end overnight but it is good to know that this market segment has the resilience and flexibility to move quickly when it does. JobKeeper has played a vital role here in steadying the business sector, although some of the survey respondents reported compliance concerns. The extension of the instant asset write-off scheme will also be welcomed in the mid-market sector,” she said.
Key business challenges still to be addressed
The survey found that the economic environment was overwhelmingly (79 per cent) the biggest challenge for respondents, followed by other financial issues such as decreased consumer confidence (48 per cent), cost bases increases and reduced profitability (43 per cent) along with workforce engagement and capability.
In terms of responses:
- two-thirds of respondents said they had, or would be, financial stress-testing and forecasting and assessing liquidity with just over half carrying out cost containment measures.
- 48 per cent said they would be transforming business models and internal culture
- 47 per cent said they would be promoting innovation and agility
- More than a third said they had cancelled or deferred planned investment.
Over the next year, ways of working (60 per cent) and the financial strategy (54 per cent) were the two likeliest areas to change, the survey found.
In terms of business gaps and future needs, marketing was identified as a challenge that needed to be addressed by many businesses – much of this activity had ceased during the COVID-19 shutdown, and now businesses had a challenge in deciding when to resume it.
Kipper added “There are a variety of challenges now facing the mid-tier sector as we start to emerge from the lockdown, but the overriding feeling shown by the report is one of cautious optimism.
“Most businesses feel they will either grow, or if business performance is shifting, then the negatives will be outweighed by the growth in the next three-month period. And even those industries which have been in complete shutdown say they believe they will be back to 80 per cent profitability by September to January.”