Asia is – still and for the foreseeable future – the powerhouse of global economic growth when compared with traditional markets in the United States, the United Kingdom and the EU.
Fortunately for Australians, the demand for high quality “Brand Australia” products and services is strong across Asia and continues to stimulate Australian businesses to grow offshore. Data from the report suggests that hundreds of billions of dollars can flow into the Australian economy if businesses act on their intentions to expand into Asia.
For the past five years, ANZ’s Opportunity Asia Report, a survey of 1000 Australian business decision-makers across a variety of industries, has produced insights into developments and growth areas throughout the region. The findings confirm some perceptions – China continues to be the main market for companies looking to export their products and services – but remind us other, more developed, North Asian markets including Japan and Korea remain important.
The outlook for Australian businesses in Asia remains strong with 64 per cent of Asia active businesses expecting to expand their operations over the next three years. For companies engaged in Asian markets, approximately one-third of their overall revenue is generated from Asia. This level has grown steadily from 25 per cent in 2016.
Ecommerce is playing an increasingly important role in the growth of export businesses into Asia. Selling both products and services online provides an opportunity to reach more consumers in more places, all across Asia. Over half of exporters surveyed are currently using ecommerce to reach markets in Asia; with 44 per cent indicating their own website is the main online sales channel used.
An increasing number of businesses are exporting services each year (34 per cent), while 57 per cent of the Australian businesses surveyed that are active in Asian markets are importing products and services.
Despite the profile of China, ASEAN stands out as the key region in Asia for Australian business engagement, with 70 per cent indicating they are doing business there, compared to 69 per cent with Greater China.
The rewards are there for businesses who remain dedicated to the market – around half of the businesses surveyed reported a positive return on investment from Asian operations within three years. Additionally, 51 per cent of businesses surveyed were able to generate a higher profit margin from their Asian operations compared with their Australian-based activities.
Over the past five years, the Opportunity Asia report has provided businesses with insights into how they can successfully scale their operations and explore different trading possibilities in Asia. The 2019 ANZ Opportunity Asia report is available to download on the ANZ Be Trade Ready website.
Isaac Rankin, Managing Director of Commercial Banking, ANZ