Understanding Australia's Business and Consumer Environment: A Guide for Successful Business Down Under

Understanding Australia's Business and Consumer Environment

How will Australia's economy, business environment and consumer trends impact the success of your business? This e-book examines the fundamentals businesses must understand to successfully expand or operate in Australia.

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Heralded as the success story among advanced economies for weathering the global economic downturn of 2008-2009, Australia’s high income levels and steady growth offer good opportunities for consumer goods and services in a wide range of sectors.

Key Findings:

• At the height of the global slowdown, advanced economies as a whole contracted by 3.5% - contrasting with Australia’s 1.4% growth.
• Whereas incomes and consumer expenditure have stagnated across many advanced economies, Australia’s per capita disposable income and expenditure have expanded by 9.8% and 3.5% respectively in real terms since 2008.
• In 2012, Australia was ranked 15 out of 183 economies on the World Bank’s Ease of Doing Business Index, meaning it is the fifteenth easiest place in the world to start and operate a local firm.
• Australia has an educated population: 99.9% of adults (those aged 15+) were literate in 2011, but suffers from skills shortages.
• In 2011, the population aged 45-49 in Australia had the highest average gross income: A$77,810 (US$80,259).

Topics include:

• Ease of doing business rating
• Corruption index
• Literacy rate
• Future challenges
• Natural resources
• Media consumption
• Consumer trends
• More

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Ditch the Drawer Part I: Laundry Care Innovation Ditches the Drawer

Analyst Insight by Emily Potts, Contributing Analyst, Euromonitor International

When it comes to HE washing machines, which compartment does the detergent go in? What about fabric softener? Washing machine drawers bring confusion to many. While some consumers research this problem online – a quick search of ‘washing machine drawers’ brings up plenty of queries, hints and instructions – plenty will rely on guesswork, and more industrious souls might read the instructions that came with the machine, if they can find them. With many of the symbols used on washing machine draws having little consistency between brands and also the labels on detergent and softener brands themselves, it is little wonder consumers get confused.

This is also an indication of the lack of connection which still exists between the software (brand) and hardware (appliance) providers in this corner of the fmcg industry. In these days of convenience-driven innovation in both consumer appliances and laundry care, there is surely opportunity for detergent manufacturers in collaboration with machine manufacturers to simplify one of the most confusing parts of the laundry process, innovation that may also herald an opportunity to do away with the mysterious drawer all together.

Unilever: Is Creating its Own Tea Pod Machine a Risk Worth Taking?

Analyst Insight by Hope Lee, Senior Analyst - Beverages, Euromonitor International

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As fresh coffee manufacturers look for growth opportunities from pod machines, tea giant Unilever can also consider creating its own branded system. In a Q1 2013 financial release, Unilever reported improved tea revenues, achieving mid-single digit growth. The company attributed its good results to “improved product quality, stronger mixes and improved in-market execution”. Analysts are asking if these factors are sufficient to maintain the long-term growth of its tea business. In a recent conference, Unilever’s Executive VP of Global Beverages was reported as saying that tea capsules and the out-of-home market offer a premium opportunity. Tea, a minor business for the fmcg giant, could make a positive contribution to its corporate financial objective of achieving revenues worth €80 billion by 2020 if this premium opportunity is seized at the right time.

Thinking Again… The Future of Coffee Pod Machines

Analyst Insight by Lorenza Della-Santa, Senior Analyst - Consumer Appliances, Euromonitor International

Last October I explored the striking differences between consumption of coffee pods and fresh coffee in Western Europe and the US, and what that meant for future sales of coffee machines. I came to the conclusion that “…perhaps by investing more in open coffee brewing systems, manufacturers could favour with consumers who might be willing to spend more for a coffee machine that offers them free choice rather than being tied to a brand for life’.

It might be time to think again…

Healthy Eating Habits Create an Opportunity for Consumer Appliances

With desk jobs and hectic lifestyles, many consumers find it hard to eat right and exercise. The demand for healthier, low fat food is pushing the consumer appliance industry to create products that address these weight management problems, such as low fat fryers and refrigeration systems that can keep fresh fruit and vegetables frost-free. 

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The BRICs Lead Volume Sales of Washing Machines in 2017

The BRIC countries are amongst the top five largest markets for washing machines. This trend is evident in China where due to increased disposable incomes, semi-automatic washing machines are expected to see steep sales decline while automatic washing machines are set to show double-digit volume growth over 2012-2017. In contrast, the lower priced semi-automatic washing machines will continue to generate strong sales in Brazil and India.

Microwaves in Brazil Are Becoming a Billion Dollar Business. Are You in the Game?

Analyst Insight by Lorenza Della Santa, Senior Consumer Appliance Analyst at Euromonitor International

Microwaves in Brazil have never been so popular. Already worth US$836 million, the market is set to expand by a further US$ 1billion by 2017. To put that into context, it’s on the way to becoming as big as China. How so? Partly because prices are higher, but perhaps more significantly around 20 million households own a microwaves in Brazil today, and by 2017 we expect this consumer base to double and exceed 40 million homes.

Lessives Liquides : Enzymes et Polymères Sont Essentiels au Développement Durable

En Europe de l’Ouest, le développement durable est une des principales tendances dans les lessives. Cependant, les consommateurs sont réticents à dépenser plus d’argent, même pour des produits durables, et les fabricants essayent de réduire leurs coûts. Par conséquent, seuls quelques ingrédients devraient bénéficier de la tendance « verte ».  Enzymes et polymères seraient ceux à en profiter car ils sont durables, peuvent être concentrés et sont rentables à la fois pour les consommateurs et les fabricants.

Impulsion des fabricants

Les fabricants sont responsables de la montée en puissance des concentrés dans les lessives liquides. Introduire de nouvelles lessives liquides concentrées leur permet de réduire leurs coûts en diminuant leur consommation d’eau, d’emballage et de transport. Depuis 2011, les principaux acteurs du marché français tels qu’Unilever, Procter&Gamble et Henkel ont peu à peu abandonné leur production de lessives liquides standard au profit des lessives concentrées. Trouver des lessives liquides standard dans le commerce devient de plus en plus rare. Les consommateurs français n’ont pas d’autres choix que de changer leurs habitudes d’achat et de se tourner vers les lessives concentrées. Il n’est ainsi pas surprenant que les prévisions de croissance de cette catégorie soient les plus performantes du secteur de la lessive : 27% entre 2011 et 2016 en France.

Robotic Vacuum Cleaners: Where There’s Savings, There’s Hope

Analyst Insight by Lorenza Della-Santa, Senior Analyst - Consumer Appliances, at Euromonitor International

Almost negligible five years ago, the robotic vacuum cleaner market in Western Europe is now the world’s largest in volume terms, having overtaken North America in 2012. More significantly, Western Europe is also far and away the most valuable market.  Already worth US$434 million, twice the size of North America, by 2017 sales in the region are expected to increase by a further 50%. At this rate, in five years time Western European consumers will be spending three times more than their North American counterparts annually. And although still niche, robotic vacuum cleaners have recorded the largest value growth in real terms of all small appliances in 2012.

Japanese Appliance Manufacturers Struggle in Domestic Market

Japanese appliance companies such as Panasonic and Sharp have been powerhouses since the 1980s, but face slow sales due to the economic downturn and competition from Chinese companies. In order to compete with other Asian manufacturers such as Haier and LG, Japanese appliance companies should look to overseas markets and identify niches in smaller, personal appliances, states Jamie Ko, Head of Consumer Appliances Research at Euromonitor.

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