Welcome!

Search Authors: Elizabeth White, Aditya Banerjee, Sematext Blog, Jnan Dash, Shelly Palmer

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
The Internet of Things will greatly expand the opportunities for data collection and new business models driven off of that data. In her session at @ThingsExpo, Esmeralda Swartz, CMO of MetraTech, discussed how for this to be effective you not only need to have infrastructure and operational models capable of utilizing this new phenomenon, but increasingly service providers will need to convince a skeptical public to participate. Get ready to show them the money!
The Industrial Internet revolution is now underway, enabled by connected machines and billions of devices that communicate and collaborate. The massive amounts of Big Data requiring real-time analysis is flooding legacy IT systems and giving way to cloud environments that can handle the unpredictable workloads. Yet many barriers remain until we can fully realize the opportunities and benefits from the convergence of machines and devices with Big Data and the cloud, including interoperability, data security and privacy.
The 3rd International Internet of @ThingsExpo, co-located with the 16th International Cloud Expo - to be held June 9-11, 2015, at the Javits Center in New York City, NY - announces that its Call for Papers is now open. The Internet of Things (IoT) is the biggest idea since the creation of the Worldwide Web more than 20 years ago.
Cloud Expo 2014 TV commercials will feature @ThingsExpo, which was launched in June, 2014 at New York City's Javits Center as the largest 'Internet of Things' event in the world.
"People are a lot more knowledgeable about APIs now. There are two types of people who work with APIs - IT people who want to use APIs for something internal and the product managers who want to do something outside APIs for people to connect to them," explained Roberto Medrano, Executive Vice President at SOA Software, in this SYS-CON.tv interview at Cloud Expo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
SYS-CON Media announced that Splunk, a provider of the leading software platform for real-time Operational Intelligence, has launched an ad campaign on Big Data Journal. Splunk software and cloud services enable organizations to search, monitor, analyze and visualize machine-generated big data coming from websites, applications, servers, networks, sensors and mobile devices. The ads focus on delivering ROI - how improved uptime delivered $6M in annual ROI, improving customer operations by mining large volumes of unstructured data, and how data tracking delivers uptime when it matters most.
DevOps Summit 2015 New York, co-located with the 16th International Cloud Expo - to be held June 9-11, 2015, at the Javits Center in New York City, NY - announces that it is now accepting Keynote Proposals. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long development cycles that produce software that is obsolete at launch. DevOps may be disruptive, but it is essential.
Wearable devices have come of age. The primary applications of wearables so far have been "the Quantified Self" or the tracking of one's fitness and health status. We propose the evolution of wearables into social and emotional communication devices. Our BE(tm) sensor uses light to visualize the skin conductance response. Our sensors are very inexpensive and can be massively distributed to audiences or groups of any size, in order to gauge reactions to performances, video, or any kind of presentation. In her session at @ThingsExpo, Jocelyn Scheirer, CEO & Founder of Bionolux, will discuss ho...
“With easy-to-use SDKs for Atmel’s platforms, IoT developers can now reap the benefits of realtime communication, and bypass the security pitfalls and configuration complexities that put IoT deployments at risk,” said Todd Greene, founder & CEO of PubNub. PubNub will team with Atmel at CES 2015 to launch full SDK support for Atmel’s MCU, MPU, and Wireless SoC platforms. Atmel developers now have access to PubNub’s secure Publish/Subscribe messaging with guaranteed ¼ second latencies across PubNub’s 14 global points-of-presence. PubNub delivers secure communication through firewalls, proxy ser...
We’re no longer looking to the future for the IoT wave. It’s no longer a distant dream but a reality that has arrived. It’s now time to make sure the industry is in alignment to meet the IoT growing pains – cooperate and collaborate as well as innovate. In his session at @ThingsExpo, Jim Hunter, Chief Scientist & Technology Evangelist at Greenwave Systems, will examine the key ingredients to IoT success and identify solutions to challenges the industry is facing. The deep industry expertise behind this presentation will provide attendees with a leading edge view of rapidly emerging IoT oppor...
The 3rd International Internet of @ThingsExpo, co-located with the 16th International Cloud Expo - to be held June 9-11, 2015, at the Javits Center in New York City, NY - announces that its Call for Papers is now open. The Internet of Things (IoT) is the biggest idea since the creation of the Worldwide Web more than 20 years ago.
Connected devices and the Internet of Things are getting significant momentum in 2014. In his session at Internet of @ThingsExpo, Jim Hunter, Chief Scientist & Technology Evangelist at Greenwave Systems, examined three key elements that together will drive mass adoption of the IoT before the end of 2015. The first element is the recent advent of robust open source protocols (like AllJoyn and WebRTC) that facilitate M2M communication. The second is broad availability of flexible, cost-effective storage designed to handle the massive surge in back-end data in a world where timely analytics is e...
"There is a natural synchronization between the business models, the IoT is there to support ,” explained Brendan O'Brien, Co-founder and Chief Architect of Aria Systems, in this SYS-CON.tv interview at the 15th International Cloud Expo®, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
The Internet of Things will put IT to its ultimate test by creating infinite new opportunities to digitize products and services, generate and analyze new data to improve customer satisfaction, and discover new ways to gain a competitive advantage across nearly every industry. In order to help corporate business units to capitalize on the rapidly evolving IoT opportunities, IT must stand up to a new set of challenges. In his session at @ThingsExpo, Jeff Kaplan, Managing Director of THINKstrategies, will examine why IT must finally fulfill its role in support of its SBUs or face a new round of...
The BPM world is going through some evolution or changes where traditional business process management solutions really have nowhere to go in terms of development of the road map. In this demo at 15th Cloud Expo, Kyle Hansen, Director of Professional Services at AgilePoint, shows AgilePoint’s unique approach to dealing with this market circumstance by developing a rapid application composition or development framework.

ARMONK, N.Y., Nov. 20, 2014 /PRNewswire/ --  IBM (NYSE: IBM) today announced that it is bringing a greater level of control, security and flexibility to cloud-based application development and delivery with a single-tenant version of Bluemix, IBM's platform-as-a-service. The new platform enables developers to build ap...

Building low-cost wearable devices can enhance the quality of our lives. In his session at Internet of @ThingsExpo, Sai Yamanoor, Embedded Software Engineer at Altschool, provided an example of putting together a small keychain within a $50 budget that educates the user about the air quality in their surroundings. He also provided examples such as building a wearable device that provides transit or recreational information. He then reviewed the resources available to build wearable devices at home including open source hardware, the raw materials required and the options available to power s...
An entirely new security model is needed for the Internet of Things, or is it? Can we save some old and tested controls for this new and different environment? In his session at @ThingsExpo, New York's at the Javits Center, Davi Ottenheimer, EMC Senior Director of Trust, reviewed hands-on lessons with IoT devices and reveal a new risk balance you might not expect. Davi Ottenheimer, EMC Senior Director of Trust, has more than nineteen years' experience managing global security operations and assessments, including a decade of leading incident response and digital forensics. He is co-author of t...
The Internet of Things is not new. Historically, smart businesses have used its basic concept of leveraging data to drive better decision making and have capitalized on those insights to realize additional revenue opportunities. So, what has changed to make the Internet of Things one of the hottest topics in tech? In his session at @ThingsExpo, Chris Gray, Director, Embedded and Internet of Things, discussed the underlying factors that are driving the economics of intelligent systems. Discover how hardware commoditization, the ubiquitous nature of connectivity, and the emergence of Big Data a...
The Internet of Things promises to transform businesses (and lives), but navigating the business and technical path to success can be difficult to understand. In his session at @ThingsExpo, Sean Lorenz, Technical Product Manager for Xively at LogMeIn, demonstrated how to approach creating broadly successful connected customer solutions using real world business transformation studies including New England BioLabs and more.