Welcome!

Cognitive Computing Authors: Liz McMillan, Yeshim Deniz, Shelly Palmer, Elizabeth White, Rajeev Kozhikkattuthodi

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
Nordstrom is transforming the way that they do business and the cloud is the key to enabling speed and hyper personalized customer experiences. In his session at 21st Cloud Expo, Ken Schow, VP of Engineering at Nordstrom, will discuss some of the key learnings and common pitfalls of large enterprises moving to the cloud. This includes strategies around choosing a cloud provider(s), architecture, and lessons learned. In addition, he’ll go over some of the best practices for structured team migrat...
SYS-CON Events announced today that Taica will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Taica manufacturers Alpha-GEL brand silicone components and materials, which maintain outstanding performance over a wide temperature range -40C to +200C. For more information, visit http://www.taica.co.jp/english/.
SYS-CON Events announced today that MIRAI Inc. will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. MIRAI Inc. are IT consultants from the public sector whose mission is to solve social issues by technology and innovation and to create a meaningful future for people.
Recently, REAN Cloud built a digital concierge for a North Carolina hospital that had observed that most patient call button questions were repetitive. In addition, the paper-based process used to measure patient health metrics was laborious, not in real-time and sometimes error-prone. In their session at 21st Cloud Expo, Sean Finnerty, Executive Director, Practice Lead, Health Care & Life Science at REAN Cloud, and Dr. S.P.T. Krishnan, Principal Architect at REAN Cloud, will discuss how they bu...
Coca-Cola’s Google powered digital signage system lays the groundwork for a more valuable connection between Coke and its customers. Digital signs pair software with high-resolution displays so that a message can be changed instantly based on what the operator wants to communicate or sell. In their Day 3 Keynote at 21st Cloud Expo, Greg Chambers, Global Group Director, Digital Innovation, Coca-Cola, and Vidya Nagarajan, a Senior Product Manager at Google, will discuss how from store operations...
As hybrid cloud becomes the de-facto standard mode of operation for most enterprises, new challenges arise on how to efficiently and economically share data across environments. In his session at 21st Cloud Expo, Dr. Allon Cohen, VP of Product at Elastifile, will explore new techniques and best practices that help enterprise IT benefit from the advantages of hybrid cloud environments by enabling data availability for both legacy enterprise and cloud-native mission critical applications. By rev...
Join IBM November 1 at 21st Cloud Expo at the Santa Clara Convention Center in Santa Clara, CA, and learn how IBM Watson can bring cognitive services and AI to intelligent, unmanned systems. Cognitive analysis impacts today’s systems with unparalleled ability that were previously available only to manned, back-end operations. Thanks to cloud processing, IBM Watson can bring cognitive services and AI to intelligent, unmanned systems. Imagine a robot vacuum that becomes your personal assistant tha...
SYS-CON Events announced today that Datera will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Datera offers a radically new approach to data management, where innovative software makes data infrastructure invisible, elastic and able to perform at the highest level. It eliminates hardware lock-in and gives IT organizations the choice to source x86 server nodes, with business model option...
With major technology companies and startups seriously embracing Cloud strategies, now is the perfect time to attend 21st Cloud Expo October 31 - November 2, 2017, at the Santa Clara Convention Center, CA, and June 12-14, 2018, at the Javits Center in New York City, NY, and learn what is going on, contribute to the discussions, and ensure that your enterprise is on the right path to Digital Transformation.
Infoblox delivers Actionable Network Intelligence to enterprise, government, and service provider customers around the world. They are the industry leader in DNS, DHCP, and IP address management, the category known as DDI. We empower thousands of organizations to control and secure their networks from the core-enabling them to increase efficiency and visibility, improve customer service, and meet compliance requirements.
Digital transformation is changing the face of business. The IDC predicts that enterprises will commit to a massive new scale of digital transformation, to stake out leadership positions in the "digital transformation economy." Accordingly, attendees at the upcoming Cloud Expo | @ThingsExpo at the Santa Clara Convention Center in Santa Clara, CA, Oct 31-Nov 2, will find fresh new content in a new track called Enterprise Cloud & Digital Transformation.
SYS-CON Events announced today that N3N will exhibit at SYS-CON's @ThingsExpo, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. N3N’s solutions increase the effectiveness of operations and control centers, increase the value of IoT investments, and facilitate real-time operational decision making. N3N enables operations teams with a four dimensional digital “big board” that consolidates real-time live video feeds alongside IoT sensor data a...
SYS-CON Events announced today that NetApp has been named “Bronze Sponsor” of SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. NetApp is the data authority for hybrid cloud. NetApp provides a full range of hybrid cloud data services that simplify management of applications and data across cloud and on-premises environments to accelerate digital transformation. Together with their partners, NetApp emp...
Smart cities have the potential to change our lives at so many levels for citizens: less pollution, reduced parking obstacles, better health, education and more energy savings. Real-time data streaming and the Internet of Things (IoT) possess the power to turn this vision into a reality. However, most organizations today are building their data infrastructure to focus solely on addressing immediate business needs vs. a platform capable of quickly adapting emerging technologies to address future ...
SYS-CON Events announced today that Avere Systems, a leading provider of hybrid cloud enablement solutions, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Avere Systems was created by file systems experts determined to reinvent storage by changing the way enterprises thought about and bought storage resources. With decades of experience behind the company’s founders, Avere got its ...
SYS-CON Events announced today that Avere Systems, a leading provider of enterprise storage for the hybrid cloud, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 - Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Avere delivers a more modern architectural approach to storage that doesn't require the overprovisioning of storage capacity to achieve performance, overspending on expensive storage media for inactive data or the overbui...
SYS-CON Events announced today that IBM has been named “Diamond Sponsor” of SYS-CON's 21st Cloud Expo, which will take place on October 31 through November 2nd 2017 at the Santa Clara Convention Center in Santa Clara, California.
SYS-CON Events announced today that Ryobi Systems will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Ryobi Systems Co., Ltd., as an information service company, specialized in business support for local governments and medical industry. We are challenging to achive the precision farming with AI. For more information, visit http:...
High-velocity engineering teams are applying not only continuous delivery processes, but also lessons in experimentation from established leaders like Amazon, Netflix, and Facebook. These companies have made experimentation a foundation for their release processes, allowing them to try out major feature releases and redesigns within smaller groups before making them broadly available. In his session at 21st Cloud Expo, Brian Lucas, Senior Staff Engineer at Optimizely, will discuss how by using...
In this strange new world where more and more power is drawn from business technology, companies are effectively straddling two paths on the road to innovation and transformation into digital enterprises. The first path is the heritage trail – with “legacy” technology forming the background. Here, extant technologies are transformed by core IT teams to provide more API-driven approaches. Legacy systems can restrict companies that are transitioning into digital enterprises. To truly become a lead...