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8167.0 - Selected Characteristics of Australian Business, 2009-10 Quality Declaration 
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 15/09/2011   
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BUSINESS MARKETS AND COMPETITION


Geographic markets in which businesses sold goods or services

Businesses were asked to identify all geographic markets in which they sold their goods or services during the year ended 30 June 2010.

Geographic markets in which businesses sold goods or services, by employment size(a)(b)(c), 2009 - 10

0-4 persons
5-19 persons
20-199 persons
200 or more persons
Total
%
%
%
%
%

Local area(d)
79.1
83.2
81.3
80.4
80.6
Outside of local area but within the state/territory
38.2
44.9
47.8
69.6
41.2
Outside of state/territory but within Australia
20.7
23.4
35.1
67.1
22.9
Overseas markets
5.5
8.5
15.3
32.8
7.4

(a) Proportions are of all businesses in each employment size range.
(b) Businesses were asked to identify all geographic markets in which they sold goods or services.
(c) Businesses could report more than one geographic market.
(d) Local area includes the immediate area, town or city in which the business is located.


Overall, 81% of businesses sold goods or services in the local area. Just over 7% of businesses sold goods and services in overseas markets; ranging from 6% of businesses with 0-4 persons employed, to 33% for businesses with 200 or more persons employed.

Businesses with 5-19 persons employed had the highest proportion of goods or services sold in the local area (83%), while businesses with 200 or more persons employed were highest in the remaining three geographic markets.

The proportion of businesses that sold goods or services within the local area was highest in Health care and social assistance and Accommodation and food services (both 95%). Businesses in Information media and telecommunications had the highest proportion of sales of goods or services for both outside of state/territory but within Australia (59%) and overseas markets (28%), with businesses in Wholesale trade most likely to have sold goods or services outside of local area but within the state/territory (60%).


Main source of business income

Businesses were asked to identify their main source of income from the sale of goods or services during the year ended 30 June 2010. A list of sources was provided, however, definitions for large businesses or organisations and small and/or medium businesses or organisations were not provided.

Main source of business income, by employment size(a)(b)(c), 2009 - 10

0-4 persons
5-19 persons
20-199 persons
200 or more persons
Total
%
%
%
%
%

Australian sources
Government organisations
5.0
5.9
8.4
13.6
5.6
Large businesses or organisations
15.5
16.9
23.8
44.2
16.7
Small and/or medium businesses or organisations
40.2
34.8
32.0
24.5
37.8
General public
45.2
51.3
44.5
25.5
47.0
Overseas sources
1.6
2.2
2.3
5.3
1.9

(a) Proportions are of all businesses in each employment size range.
(b) Businesses were asked to identify their main source of income from the sales of goods or services and were asked to nominate one source only.
(c) The sum of the component items within employment size ranges may not equal 100% due to rounding and/or provision of multiple responses, please refer to Explanatory Notes 26 and 27 and the Quality Declaration.


Just under half of all businesses (47%) had the Australian general public as their main source of income, followed by small and/or medium businesses or organisations within Australia (38%).

Businesses with 200 or more persons employed were most likely to have their main source of income from large businesses or organisations within Australia (44%). Businesses within this employment size range also had the highest proportion for main source of income received from overseas sources (5%).

Accommodation and food services had the highest proportion of businesses with the Australian general public as their main source of income (89%). Businesses in Mining were the most likely to have overseas sources as their main source of income (12%).


Main supplier of goods or services

Businesses were asked to identify their main supplier of goods or services for the year ended 30 June 2010. A list of suppliers was provided, however, definitions for large businesses or organisations and small and/or medium businesses or organisations were not provided.

Main supplier of goods or services, by employment size(a)(b)(c), 2009 - 10

0-4 persons
5-19 persons
20-199 persons
200 or more persons
Total
%
%
%
%
%

Australian suppliers
Government organisations
1.8
1.7
1.8
1.5
1.8
Large businesses or organisations
15.5
21.3
27.0
46.5
18.4
Small and/or medium businesses or organisations
61.4
64.4
57.8
35.3
61.9
Overseas suppliers
5.3
6.3
9.0
12.7
5.9
Not applicable
18.6
11.8
11.4
11.2
15.8

(a) Proportions are of all businesses in each employment size range.
(b) Businesses were asked to identify their main supplier of goods or services and were asked to nominate one supplier only.
(c) The sum of the component items within employment size ranges may not equal 100% due to rounding and/or provision of multiple responses, please refer to Explanatory Notes 26 and 27 and the Quality Declaration.


More than half of all businesses (62%) utilised Australian small and/or medium businesses or organisations as their main supplier of goods or services, with Australian government organisations the least common (2%). The proportion of businesses with overseas suppliers as their main supplier of goods or services increased with each successive employment size range.

Businesses in Wholesale trade (37%) had the highest proportion of overseas suppliers, with all remaining industries having proportions of 10% or less, including Mining (7%).


Reliance on clients, customers and buyers

Businesses were asked whether they relied on a small number of clients, customers or buyers to generate a significant proportion of their income. The question was not accompanied by a definition of what constitutes a small number of clients, customers or buyers or what constitutes a significant proportion of their income. Businesses that did rely on a small number of clients, customers or buyers were also asked to indicate the potential impact to their business if they lost one of these.

Reliance on clients, customers or buyers, by employment size(a), 2009 - 10

0-4 persons
5-19 persons
20-199 persons
200 or more persons
Total
%
%
%
%
%

Businesses that relied on a small number of clients, customers or buyers(a)
54.1
44.0
39.9
34.5
49.7
Potential impact on business income from the loss of one of these clients, customers or buyers(b)(c)
Little or no impact on the business's income as it would have been relatively easy to find replacement client, customer or buyer
39.1
37.2
30.4
17.7
37.9
Moderate to large impact on the business's income as it would have been difficult to find replacement client, customer or buyer
46.2
53.2
53.8
65.8
48.6
Extremely large impact which would have forced this business to close
15.3
9.9
16.1
^16.6
13.9

^ estimate has a relative standard error of 10% to less than 25% and should be used with caution
(a) Proportions are of all businesses in each employment size range.
(b) Proportions are of businesses that relied on a small number of clients, customers or buyers to generate a significant proportion of their income, in each employment size range.
(c) The sum of the component items within employment size ranges may not equal 100% due to rounding and/or provision of multiple responses, please refer to Explanatory Notes 26 and 27 and the Quality Declaration.


Almost half of all businesses relied on a small number of clients, customers or buyers to generate a significant proportion of their income, with the highest proportion in businesses with 0-4 persons employed (54%).

Of the businesses relying on a small number of clients, customers or buyers, 49% indicated there would be a moderate to large impact on business income if one of these clients was lost.

Businesses in Transport, postal and warehousing were most likely to experience an extremely large impact on business income in the event of losing one of these clients (34%). By contrast, 73% of businesses in Health care and social assistance expected little or no impact as the outcome of losing one of these clients.


Degree of competition

All businesses were asked to describe the degree of competition they experienced during the year ended 30 June 2010. They were required to select one of four available options; none/captive market/no effective competition; one or two competitors, three or four competitors, or five or more competitors.

This question was different to that asked in 2008-09 where businesses were asked to rate the level of competition from: captive market/no effective competition, minimal degree of competition, moderate degree of competition and strong/tough competition. The question was changed as a result of updated user requirements.

Degree of competition experienced by businesses, by employment size(a)(b)(c), 2009 - 10

0-4 persons
5-19 persons
20-199 persons
200 or more persons
Total
%
%
%
%
%

Degree of competition:
none/captive market/no effective competition
19.0
10.7
10.0
8.4
15.6
one or two
12.0
12.2
12.3
10.2
12.1
three or four
13.1
16.6
15.8
18.1
14.5
five or more
56.1
60.9
62.7
63.4
58.2

(a) Proportions are of all businesses in each employment size range.
(b) Businesses were asked to identify which one of four options best described the degree of competition experienced during the year.
(c) The sum of the component items within employment size ranges may not equal 100% due to rounding and/or provision of multiple responses, please refer to Explanatory Notes 26 and 27 and the Quality Declaration.


Over half of businesses had five or more competitors (58%) in 2009-10. In contrast, 16% of businesses considered their degree of competition as none/captive market/no effective competition.

None/captive market/no effective competition was most prevalent among businesses with 0-4 persons employed (19%), over twice the proportion of businesses with 200 or more persons employed (8%).

Businesses in Financial and insurance services (72%) and Construction (66%) were most likely to have five or more competitors, compared to 45% of businesses in Electricity, gas, water and waste services. Agriculture, forestry and fishing had the highest proportion of businesses with none/captive market/no effective competition (34%), followed by Transport, postal and warehousing (28%).


Size of competitors

Businesses with some form of competition were asked to identify the size of their major competitors during the year ended 30 June 2010. They were asked to select one of three options; smaller in size than this business, about the same size as this business, and larger in size than this business. A definition of what constitutes the size of competitors was not provided.

Size of competitors, by employment size(a)(b)(c), 2009 - 10

0-4 persons
5-19 persons
20-199 persons
200 or more persons
Total
%
%
%
%
%

Competitors which were:
smaller in size
6.2
9.7
13.1
18.1
8.0
same size
51.1
54.1
51.1
49.4
52.1
larger in size
46.2
39.7
39.8
35.1
43.4

(a) Proportions are of businesses with some degree of competition in each employment size range.
(b) Businesses were asked to identify their main source of competition and were asked to nominate one source only.
(c) The sum of the component items within employment size ranges may not equal 100% due to rounding and/or provision of multiple responses, please refer to Explanatory Notes 26 and 27 and the Quality Declaration.


Of those businesses with some degree of competition, over half (52%) have competitors about the same size as the business. Less than one in ten businesses indicated that their competitors were smaller in size than the business (8%).

Accommodation and food services had the highest proportion of businesses with competitors about the same size as the business (68%). This industry also had the lowest proportion of competitors larger in size (29%).


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