Industry Analysis & Industry Trends
The industry experienced some clean and dirty patches over the past five years. An increase in the number of Australian businesses meant the need for cleaning and maintenance supplies grew. Meanwhile, households, businesses and governments increasingly outsourced their cleaning activities. The outsourcing increased downstream demand from cleaning service providers, which contributed to revenue growth over the past five years. Industry revenue is forecast to increase at an annualised 2.2% over the five years through 2012-13 to reach $975.8 million.
Factors that led to higher revenue were not all beneficial though. High commodity prices, particularly those for oil, increased the industry's purchase costs of cleaning and maintenance products that used plastic and petrochemicals... purchase to read more
Industry Report - Industry Investment Chapter
The industry has a medium level of capital intensity. The industry spends an estimated $4.42 on labour for every dollar it invests in new capital. This is because of the industry's investments in machinery and technology that boost the efficiency of its wholesale function. These include sorting equipment, warehouses and forklifts. Capital intensity increased over the past five years as operators invested in equipment and technology that reduced their reliance on labour.
Capital intensity is forecast to diminish over the next five years. Operators are expected to hold back investments in new capital as the industry consolidates. Competition is expected to increase as online wholesale platforms and e-commerce increase the reach of some of the larger operators... purchase to read more