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BDO Ambition Survey 2011 - Global opportunities
The BDO Ambition Survey 2011 highlights that 95% of mid-cap CFOs are confident about their international expansion plans, expecting an increase in revenue from international sources. Challenges include red tape and finding skilled personnel, with China identified as the most promising yet risky market. The survey emphasizes the importance of leveraging internal sources and trusted advisors while focusing on market research and cultural understanding for successful expansion.
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BDO Ambition Survey 2011 - Global opportunities
- 1. BDO AMBITION SURVEY2011Global opportunitiesSUMMARY OF GLOBAL RESULTSBDO / Strategy OneSeptember 2011
- 2. METHODOLOGYAll survey respondentsand companies were required to satisfy specific criteria:C-suite CFOs, FDs and other Heads of Finance - all reporting to the CEOHave global revenues of between US $50m – US $1bnHave international offices outside their headquartered countryExpect revenues representing the international side of their businesses to account for a higher or about the same proportion in the next 3 yearsCompanies operating in one of the following sectors or industries: Financial services, Manufacturing, Real estate & construction, TMT (Technology, Media, Telecommunications), Retail, Natural resources, Professional services, Tourism/ leisure/ hospitality, Transport and utilities751 telephone interviews were conducted globally
- 3. Fieldwork was conductedbetween 23 May & 8 July 2011BDO Ambition Survey 2011Page 2
- 4. KEY FINDINGSExpanding abroad:opportunitiesDespite the economic and regulatory challenges facing businesses, 95% of mid-cap CFOs are confident that their 3 year plans to expand internationally will succeedCFOs’ business plans back their confidence: on average they expect 44% of revenue in 3 years’ time to come from international sources (up from 37% now)CFOs say they have no problem getting money to expand abroad, but finding the right people - skilled, trustworthy and cross-cultural - is a real challenge
- 5. CFOs see Chinaas having 3 times the business opportunity of Brazil, the UK or France. However, China is a gamble as it has the most reward and the most risk factors of any countryChina, USA and Germany are the top 3 global investment destinations and sourcesPage 3BDO Ambition Survey 2011
- 6. KEY FINDINGS CONTINUTEDExpandingabroad: making it happen The best sources of advice for CFOs on how to expand come from close to home - internal sources and trusted customers, along with accountants and tax advisers who understand their clients’ businesses
- 7. CFOs are ina hurry to expand - they expect to open an office within a year of making a decision, which means that aligning customers, staff, partners, distributors, advisers and bankers is critical
- 8. Most businesses actfast once a decision to open a new office is made
- 9. Internal sources andexisting customers are the most trusted sources when expanding
- 10. For external advice,accountants/ tax advisers are the most trusted professionals
- 11. Most businesses willexpand in their core sector, with existing products and servicesPage 4BDO Ambition Survey 2011
- 12. KEY FINDINGS CONTINUTEDExpandingabroad: good adviceKey insights from CFOs: be prepared and invest in the right peopleDo thorough research to improve your knowledge of the marketRecruitment of good staff is key to successFind good partners in the regionHave a strong business planMake sure you understand the culture and languagePage 5BDO Ambition Survey 2011
- 13. BUSINESS OPPORTUNITIES ANDCHALLENGESPage 6Client name - Event - Presentation title
- 14. CONDUCTING BUSINESS ABROADHAS BECOME MORE DIFFICULT IN THE LAST 3 YEARSPage 7BDO Ambition Survey 2011Much more difficult
- 15. HIGH CFO CONFIDENCEIN COMPANY’S OVERSEAS EXPANSIONPage 8BDO Ambition Survey 2011Much more difficult
- 16. COMPANIES IN ALLCOUNTRIES SURVEYED EXPECT MORE FUTURE REVENUE TO COME FROM ABROAD Page 9BDO Ambition Survey 2011Much more difficult
- 17. MOST COMPANIES ARELOOKING TO EXPAND IN CORE SECTORPage 10BDO Ambition Survey 2011Much more difficult
- 18. MARKET SIZE ANDGROWTH OPPORTUNITIES DRIVE INTERNATIONAL EXPANSIONPage 11BDO Ambition Survey 2011Much more difficult
- 19. COMPANIES NAVIGATE ARANGE OF CHALLENGES IN INTERNATIONAL EXPANSIONPage 12BDO Ambition Survey 2011Much more difficult
- 20. THE BIGGEST CHALLENGESRELATE TO RED TAPE AND FINDING THE RIGHT PEOPLEPage 13Red tape is a particular challenge to French and Russian companies, Retailers, and businesses expanding with new products & services
- 21. Local people- Japanesebusinesses, Prof services/ Transport & utilities, and those expanding In India
- 22. Currency- Chinese/ Brazilian/German businesses, and those expanding in US/ Canada
- 23. Competition- Chinese, Germanand French businesses, Retailers, businesses expanding with new products & services , and those expanding into Europe
- 24. Culture/ language- Chinese/Japanese/ Australian/ French businesses, and businesses looking to expand in India/ BrazilBDO Ambition Survey 2011Much more difficult
- 25. INVESTMENT IN PEOPLEWILL BE A MAIN FOCUS OVER THE NEXT THREE YEARSPage 14People are a particular focus in all European countries, Australia, and Professional Services businesses
- 26. Channels of distribution- German/ Brazilian/ Russian/ Chinese companies, Manufacturers and businesses expanding into Russia
- 27. Product development - Brazilian & Chinese businesses, Manufacturers and businesses expanding into Western Europe/ US/ Russia
- 28. Capital - UK/ Saudi, Real Estate and Natural Resources companies
- 29. Brand & marketing- Companies from all BRIC countries + Japan, Financial services businesses and Manufacturers
- 30. Acquisitions’ North American,German, French, and Australian companiesBDO Ambition Survey 2011Much more difficult
- 31. INTERNAL SOURCES ANDEXISTING CONTACTS ARE THE MOST TRUSTED SOURCES OF ADVISE Page 15European businesses are more likely to turn to internal sources (58%)
- 32. German (62%), Chinese(53%) and Russian businesses (50%) put more trust in clients/ existing contacts
- 33. Accountants/ tax advisersare most widely used in the UK/ Netherlands (52%), Australia (50%) and USA (46%)
- 34. Australians and NorthAmericans are more likely to turn to law firms (52% and 41%)
- 35. German and Chinesebusinesses are far more likely to turn to trade organisations, etc (42%/ 33%)
- 36. Chinese businesses areby far the most likely to turn to Government agencies (42%)
- 37. Brazilian businesses showthe greatest trust in market research (44%)BDO Ambition Survey 2011Much more difficult
- 38. GAINING FUNDING FORINTERNATIONAL EXPANSION IS NOT GENERALLY A COMMON PROBLEMPage 16Difficulty gaining funding?BDO Ambition Survey 2011Much more difficult
- 39. LOCAL KNOWLEDGE ANDPEOPLE ISSUES ARE KEY WHEN EXPANDING INTERNATIONALLYPage 17BDO Ambition Survey 2011
- 40. BDO GLOBAL MARKETOPPORTUNITY INDEXPage 18Client name - Event - Presentation title
- 41. GLOBAL MARKET OPPORTUNITYINDEXExplanationPage 19BDO GLOBAL MARKET OPPORTUNITY INDEXThe index was created from CFOs’ stated intentions to expand in specific countries. The arithmetic mean of 100 is based around intention to expand to all 18 countries listed PROCESSCFOs’ stated intentions to expand into specific countries were based on the frequency of CFO mentions of expanding into a country, and the priority order of the country being mentioned, up to a third mentionWe correlated the ‘Specific countries that will be a focus for general expansion in the next three years’ against a pre-determined list of nineteen opportunity factors and sixteen challenge factorsThe 6 most important factors driving opportunity for expansion were: market size, ease of entry, people and culture, market potential, acquisition opportunities, and better opportunities abroad than at home BDO Ambition Survey 2011
- 42. GLOBAL MARKET OPPORTUNITYINDEXExplanation continuedPage 20The 5 top challenge factors were: geo-political risks, finding the right local people, in-market competition, red tape and corruption, and having money and resources to expand. This enabled us to determine which countries offer the greatest opportunities in the foreseeable futureOverall Opportunity Index is based on intention to expand internationally in three years’ time and the number of CFO mentions of a given country being expanded intoBDO Ambition Survey 2011
- 43. CFOS SEE CHINAAS OFFERING THE GREATEST EXPANSION OPPORTUNITY: USA IS A CLOSE SECONDCFOs see China as having THREE times the business opportunity of UK, Brazil or FrancePage 21BDO Ambition Survey 2011
- 44. OPPORTUNITIES AND CHALLENGESDRIVING EXPANSION Page 22BDO Ambition Survey 2011
- 45. CONTACT:International Executive Office,Brussels, BelgiumTel: +32 2 778 01 30 © Brussels Worldwide Services BVBA, September 2011 Page 23Client name - Event - Presentation title
Editor's Notes
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