Welcome!

API Journal Authors: Elizabeth White, Pat Romanski, Kevin Benedict, Anders Wallgren, Amit Golander

News Feed Item

PwC Survey Finds US Private Companies Increase Revenue Forecasts, Amid Overall Tempered Optimism

PwC's Private Company Trendsetter Barometer tracks the business issues and best practices of privately held US growth businesses. It incorporates the views of 234 chief executive officers (CEOs/CFOs): 136 from companies in the product sector and 98 in the

NEW YORK, Nov. 16, 2012 /PRNewswire/ -- In the third quarter of 2012, against the backdrop of continuing economic uncertainty and the looming fiscal cliff, PwC US's Private Company Trendsetter Barometer survey found that private companies increased their projected revenue growth rate for the next 12 months, up from 8.3 percent to 8.6 percent. The increase was driven by private companies that sell solely in the United States. Their projected revenue growth rate rose from 6.9 percent to 8.6 percent, highlighting domestic companies' confidence about the next 12 months. International companies, on the other hand, reduced their revenue growth rate (8.5 percent, down from 9.7 percent last quarter).

(Logo: http://photos.prnewswire.com/prnh/20100917/NY66894LOGO)

Meanwhile, Trendsetter executives' optimism about US economic prospects for the next 12 months remained tempered, with 44% expressing confidence (down six points from 50 percent in the second quarter), 15 percent registering pessimism (up three points), and 41 percent voicing uncertainty (up 3 points). Despite the further dip in optimism, private companies are significantly more confident than they were this time last year, when only 27 percent expressed optimism.

Among international private companies, optimism about global economic prospects for the next 12 months remained subdued, changing little from the second quarter. Twenty-three percent of companies were optimistic, while a similar percentage registered pessimism (21 percent). The majority of international businesses remained uncertain (56 percent).

"As we approach the end of another year of slow growth, US private companies are as uncertain as they are optimistic," says Ken Esch, a partner with PwC's Private Company Services practice. "These mixed sentiments have been common among Trendsetter companies in recent years. But private companies are resilient, and so although ongoing uncertainty has caused some businesses to delay or scale back plans, it hasn't translated into inaction. The uptick in private companies' projected growth rate shows that they feel they've moved past the worst of the economic downturn and are in a position to take advantage of growth opportunities, particularly here in the United States."  

Trendsetter companies' optimism about the US and world economies, today and over the past several years, is shown below:

(Photo: http://photos.prnewswire.com/prnh/20121116/NY14718)

The breakout of private companies' growth projections and economic sentiments for the next 12 months is shown below. Alongside that data are Trendsetter projections and sentiments from the prior quarter and from this time last year.

US Private-Company Growth Projections, 3Q12: 12-Month Outlook


Own Company Revenue Growth Rate

Percentage Predicting Positive Growth


3Q12

2Q12

3Q11

3Q12

2Q12

3Q11

All Private Companies

8.6%

8.3%

7.2%

83%

86%

78%

International Private Companies

8.5%

9.7%

7.6%

88%

93%

83%

International Private Companies in Emerging Markets of China, India and Brazil

7.8%

11.3%

6.7%

90%

96%

84%

Domestic Private Companies

8.6%

6.9%

6.8%

80%

79%

74%

 

US Private Company Economic Sentiment: US Economy, 12-Month Outlook


3Q12

2Q12

3Q11

Optimistic

44%

 

50%

 

27%

 

Pessimistic

15%

12%

24%

Uncertain

41%

38%

49%

US International Private-Company Economic Sentiment:

World Economy, 12-Month Outlook


3Q12

2Q12

3Q11

Optimistic

23%

23%

21%

Pessimistic

21%

23%

28%

Uncertain

56%

54%

51%

Majority of Companies Hiring, Lack of Qualified Workers Poses Challenge

The majority of private companies (55 percent) are planning net new hiring over the next 12 months, and only 5 percent plan to lay off workers. But slightly less net new composite workforce hiring is expected, down from 2.4 percent to 1.6 percent. Hourly wages are up though, from a 2.05 percent rate of increase a year ago to 2.57 percent.

While more than half of private companies plan to hire, 29 percent say a lack of qualified workers is a major potential barrier to growth over the next 12 months, showing a gap between the jobs that need to be filled and the availability of skilled workers to fill them.

"The talent gap continues to impact private companies' growth," says Esch. "While many executives seek to fill key positions to help them execute their business strategy and drive growth, they face a shortage of workers with the right skill sets. We're likely to see private companies continue hiring only at the margins until this gap can be bridged and economic growth takes off."

Lack of demand was again the chief barrier to growth in the third quarter (74 percent). Private companies also cited legislative/regulatory pressures (52 percent), increased taxation (33 percent) and profitability/decreasing margins as leading barriers to growth.

The breakout of private companies' top barriers to growth in the third quarter is shown below, along with comparative data from the second quarter and from one year ago.

Top Five US Private-Company Barriers to Growth, 3Q12


3Q12

2Q12

3Q11

Lack of Demand

74%

68%

77%

Legislative/Regulatory Pressures

52%

48%

54%

Increased Taxation

33%

28%

34%

Lack of Qualified Workers

29%

23%

22%

Profitability/Decreasing Margins

29%

31%

37%

Continued Spending and Increased Bank Loan Activity, as Companies Prepare for 2013

As private companies prepare to transition into 2013, almost one-third (32 percent) of them are planning major new investments of capital over the next 12 months, down two points since the second quarter and six points below a year ago. Spending levels at 6.5 percent of sales are moderately high, above the second quarter, as companies position themselves for growth.

Increased operational spending is planned by 73 percent of private companies over the next 12 months (up 5 points), with information technology continuing to top the list of spending areas.

The breakout of private companies' top spending areas is shown below.

Top Five US Private-Company Spending Areas, 3Q12


3Q12

2Q12

3Q11

Information Technology

31%

38%

39%

New Product or Service Introduction

31%

30%

34%

Facilities Expansion

24%

17%

21%

Marketing & Sales Promotion

23%

21%

23%

Geographic Expansion

21%

17%

22%

In line with private-company executives' robust plans to reinvest in their businesses, banking activity nearly doubled in the third quarter, with 11 percent reporting new bank-loan financing activity, up from 6 percent in the second quarter. International companies operating in emerging markets led bank-loan activity (14 percent), followed closely by domestic companies (13 percent). 

"Because of what's currently looming from a tax perspective, coupled with frothy debt markets, we're seeing more domestic M&A activity among our clients, as sellers try to lock in capital gains at lower rates before 2013," says Esch. "Now, especially, is when private-company executives need to be in planning mode so that they start the new year in an advantageous position."

About PwC's Private Company Services Practice

Moving beyond tomorrow's uncertainty and growing your business matters to you, and to us. Experience what it is like to work with professionals dedicated to serving private companies and their owners. Working with you on both day-to-day and more-complex issues such as compliance, controls, cash flow, expansion, succession, and personal financial matters -- this is PwC's Private Company Services.

You talk, we listen and share insight. We are proud to serve as advisors to more than 60% of America's Largest Private Companies(1), collaborating to help you achieve long-term success.

Experience the difference. Visit us online at pwc.com/us/pcs or email us at pwc [email protected] to start the conversation.

(1) 2011 Forbes America's Largest Private Companies List

About the PwC Network

PwC firms help organizations and individuals create the value they're looking for.  We're a network of firms in 158 countries with close to 169,000 people who are committed to delivering quality in assurance, tax and advisory services. Tell us what matters to you and find out more by visiting us at www.pwc.com.

Learn more about PwC by following us online: @PwC_LLP, YouTube, LinkedIn, Facebook and Google +.

© 2012 PricewaterhouseCoopers LLP, a Delaware limited liability partnership. All rights reserved. PwC refers to the US member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details.

SOURCE PwC US

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

@ThingsExpo Stories
There are several IoTs: the Industrial Internet, Consumer Wearables, Wearables and Healthcare, Supply Chains, and the movement toward Smart Grids, Cities, Regions, and Nations. There are competing communications standards every step of the way, a bewildering array of sensors and devices, and an entire world of competing data analytics platforms. To some this appears to be chaos. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, Bradley Holt, Developer Advocate a...
Presidio has received the 2015 EMC Partner Services Quality Award from EMC Corporation for achieving outstanding service excellence and customer satisfaction as measured by the EMC Partner Services Quality (PSQ) program. Presidio was also honored as the 2015 EMC Americas Marketing Excellence Partner of the Year and 2015 Mid-Market East Partner of the Year. The EMC PSQ program is a project-specific survey program designed for partners with Service Partner designations to solicit customer feedbac...
Connected devices and the industrial internet are growing exponentially every year with Cisco expecting 50 billion devices to be in operation by 2020. In this period of growth, location-based insights are becoming invaluable to many businesses as they adopt new connected technologies. Knowing when and where these devices connect from is critical for a number of scenarios in supply chain management, disaster management, emergency response, M2M, location marketing and more. In his session at @Th...
The cloud market growth today is largely in public clouds. While there is a lot of spend in IT departments in virtualization, these aren’t yet translating into a true “cloud” experience within the enterprise. What is stopping the growth of the “private cloud” market? In his general session at 18th Cloud Expo, Nara Rajagopalan, CEO of Accelerite, explored the challenges in deploying, managing, and getting adoption for a private cloud within an enterprise. What are the key differences between wh...
A strange thing is happening along the way to the Internet of Things, namely far too many devices to work with and manage. It has become clear that we'll need much higher efficiency user experiences that can allow us to more easily and scalably work with the thousands of devices that will soon be in each of our lives. Enter the conversational interface revolution, combining bots we can literally talk with, gesture to, and even direct with our thoughts, with embedded artificial intelligence, wh...
Cloud computing is being adopted in one form or another by 94% of enterprises today. Tens of billions of new devices are being connected to The Internet of Things. And Big Data is driving this bus. An exponential increase is expected in the amount of information being processed, managed, analyzed, and acted upon by enterprise IT. This amazing is not part of some distant future - it is happening today. One report shows a 650% increase in enterprise data by 2020. Other estimates are even higher....
SYS-CON Events announced today that Bsquare has been named “Silver Sponsor” of SYS-CON's @ThingsExpo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. For more than two decades, Bsquare has helped its customers extract business value from a broad array of physical assets by making them intelligent, connecting them, and using the data they generate to optimize business processes.
Internet of @ThingsExpo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 19th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The Internet of Things (IoT) is the most profound change in personal and enterprise IT since the creation of the Worldwide Web more than 20 years ago. All major researchers estimate there will be tens of billions devices - comp...
19th Cloud Expo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy. Meanwhile, 94% of enterpri...
It is one thing to build single industrial IoT applications, but what will it take to build the Smart Cities and truly society changing applications of the future? The technology won’t be the problem, it will be the number of parties that need to work together and be aligned in their motivation to succeed. In his Day 2 Keynote at @ThingsExpo, Henrik Kenani Dahlgren, Portfolio Marketing Manager at Ericsson, discussed how to plan to cooperate, partner, and form lasting all-star teams to change t...
In his general session at 18th Cloud Expo, Lee Atchison, Principal Cloud Architect and Advocate at New Relic, discussed cloud as a ‘better data center’ and how it adds new capacity (faster) and improves application availability (redundancy). The cloud is a ‘Dynamic Tool for Dynamic Apps’ and resource allocation is an integral part of your application architecture, so use only the resources you need and allocate /de-allocate resources on the fly.
The 19th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Digital Transformation, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportuni...
Internet of @ThingsExpo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with the 19th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world and ThingsExpo Silicon Valley Call for Papers is now open.
There is little doubt that Big Data solutions will have an increasing role in the Enterprise IT mainstream over time. Big Data at Cloud Expo - to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA - has announced its Call for Papers is open. Cloud computing is being adopted in one form or another by 94% of enterprises today. Tens of billions of new devices are being connected to The Internet of Things. And Big Data is driving this bus. An exponential increase is...
In his keynote at 18th Cloud Expo, Andrew Keys, Co-Founder of ConsenSys Enterprise, provided an overview of the evolution of the Internet and the Database and the future of their combination – the Blockchain. Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life sett...
Machine Learning helps make complex systems more efficient. By applying advanced Machine Learning techniques such as Cognitive Fingerprinting, wind project operators can utilize these tools to learn from collected data, detect regular patterns, and optimize their own operations. In his session at 18th Cloud Expo, Stuart Gillen, Director of Business Development at SparkCognition, discussed how research has demonstrated the value of Machine Learning in delivering next generation analytics to imp...
Cognitive Computing is becoming the foundation for a new generation of solutions that have the potential to transform business. Unlike traditional approaches to building solutions, a cognitive computing approach allows the data to help determine the way applications are designed. This contrasts with conventional software development that begins with defining logic based on the current way a business operates. In her session at 18th Cloud Expo, Judith S. Hurwitz, President and CEO of Hurwitz & ...
SYS-CON Events announced today that ReadyTalk, a leading provider of online conferencing and webinar services, has been named Vendor Presentation Sponsor at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. ReadyTalk delivers audio and web conferencing services that inspire collaboration and enable the Future of Work for today’s increasingly digital and mobile workforce. By combining intuitive, innovative tec...
Amazon has gradually rolled out parts of its IoT offerings, but these are just the tip of the iceberg. In addition to optimizing their backend AWS offerings, Amazon is laying the ground work to be a major force in IoT - especially in the connected home and office. In his session at @ThingsExpo, Chris Kocher, founder and managing director of Grey Heron, explained how Amazon is extending its reach to become a major force in IoT by building on its dominant cloud IoT platform, its Dash Button strat...
industrial company for a multi-year contract initially valued at over $4.0 million. In addition to DataV software, Bsquare will also provide comprehensive systems integration, support and maintenance services. DataV leverages advanced data analytics, predictive reasoning, data-driven diagnostics, and automated orchestration of remediation actions in order to improve asset uptime while reducing service and warranty costs.