The state of Australian Manufacturing: 2023 Manufacturing benchmarks

David De Fazio,
Joanna Psihogios
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While Australia’s manufacturing sector still navigates disruption, opportunities for growth and development are on the horizon.

Many are working towards expanding production and supporting profitability by improving efficiencies and productivity, enabling more sustainable measures.

Through our analysis of the financial data from 100 Australian mid-sized manufacturers, we know Australian manufacturers have a positive outlook with average year-on-year sales growing by 6.7 per cent in 2023. This growth can predominantly be attributed to increased capital expenditure and investing into emerging technologies. The outlook is particularly promising for business with revenue over $100m, whose scale has supported ongoing success through stronger forecasting linked to better pricing agreements and growing market shares due to their steady inventory.

However, cash flows have been heavily impacted by rising costs, inflationary pressures, and disruptions in supply chains. This has mainly affected manufacturers with turnovers under $40m, who face increasing profitability challenges and struggle with pricing uncertainty and maintaining production volumes. High competition and a lack of skilled labour has added to these challenges by increasing costs for businesses, creating a desire and sometimes need to adopt innovative solutions to increase production capacity. In response, the sector has increasingly embraced new and emerging technologies and sustainability measures to maintain sales margins and remain profitable.

Operating in a dynamic business landscape, pleasingly the sector still experiences government support. Initiatives like the National Reconstruction Fund, R&D Tax incentive, and state-driven programs are empowering mid-sized manufacturers to deliver on the growth ambitions and strengthening domestic capabilities.

Our 2023 Manufacturing Benchmarking report offers a unique view of the market through insights from 100 Australian mid-sized manufacturers’ financials. By understanding how your business performs against its competitors, you’re empowered to identify risks, opportunities, reflect on its operational efficiency and be more informed to achieve sustainable growth.

For a deeper dive into these results in the context of your business, please get in touch.

For the purpose of this report, mid-sized manufacturers generally have an annual turnover of $20 million - $600 million.

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