General success: Increasing government funding commitments have driven revenue growth

The Defence industry is primarily funded by the Federal Government. The industry provides a public service to the Australian population by providing national security. Industry revenue is mostly made up of Federal Government appropriations on behalf of taxpayers to fund necessary defence expenditure. The Defence industry is expected to grow at an annualised 6.0% over the five years through 2017-18, to $35.2 billion. The industry grew strong following the Coalition's victory in the 2013 Federal Election. Industry growth is anticipated to continue in 2017-18 under the Turnbull Government, with revenue expected to grow by 6.3% due to funding growth for capability development and Australian Defence Force (ADF) operations...read more.

Industry Statistics & Market Size
Revenue
$35bn
Annual Growth 13-18
6.0%
Forecast Growth 18-23
Profit
Employment
96,033
Businesses
44
Market Share of Companies
There are no companies with a dominant market share in this industry

Industry Threats & Opportunities

  • Naval expenditure for border protection, via Operation Resolute, has supported defence funding
  • Revenue has grown over the past five years, despite several military operations being wound down
  • Some of the increased expenditure will be used to build new warships, submarines and aircraft
  • Industry Report - Industry Locations Chapter

    The distribution of defence employees across Australia can largely be put down to where the industry has established its headquarters and military bases. The distribution of ADF military personnel and Australian Public Service (APS) civilian staff is decidedly different. The Department of Defence is headquartered at the Russell Offices complex in Canberra, which means there is a high concentration of APS staff working in the ACT. APS staff includes both Defence and Capability Acquisition and Sustainment Group (CASG) staff. Victoria and South Australia also have a greater proportion of APS staff than ADF personnel as CASG workers are located close to the strong equipment manufacturing industries in these states...purchase to read more.

    Additional Insights for the Defence Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Defence Industry are

  • Access to secure revenue
  • Ability to expand and curtail operations rapidly in line with market demand
  • Ability to quickly adopt new technology
  • IBISWorld analysts also discuss how external factors such as Capital expenditure on defence and Real GDP growth in the Defence industry impact industry performance..

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    What's in this report

    What is the Defence Industry?

    The Defence industry is part of Australia’s public sector. The industry largely consists of the Department of Defence, within which sit various groups involved in defence and national security. This includes the army, navy, air force, intelligence organisations and associated administrative and support functions. The industry excludes providers of services to defence, and educational institutions for the defence force.

    Industry Products
  • Army capabilities
  • Air Force capabilities
  • Navy capabilities
  • Defence support
  • Coordination and assistance
  • Superannuation and housing
  • Intelligence, science and technology
  • Industry Activities
  • Armed forces unit operation (except, service contractors and tertiary educational)
  • Civil defence operation (military)
  • Government administration (defence)
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Capital expenditure on defence
  • Real GDP growth
  • Cost of natural disasters
  • Demand from scientific research services

  • Current Performance
  • Participation and profit
  • Budget volatility
  • Military operations
  • Capital expenditure
  • Chart: Revenue Growth

  • Industry Outlook
  • Defence White Paper
  • Capital investment
  • Table: Defence Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Defence Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Central Government Administration

  • Key Selling Industries
  • Aircraft Manufacturing and Repair Services
  • Computer System Design Services
  • Engineering Consulting
  • Motor Vehicle Manufacturing
  • Shipbuilding and Repair Services
  • Wired Telecommunications Network Operation

  • Products & Services
  • Army capabilities
  • Air Force capabilities
  • Navy capabilities
  • Superannuation and housing
  • Defence support
  • Coordination and assistance
  • Intelligence, science and technology
  • Chart: Defence Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Federal Government
  • Chart: Major Market Segmentation for the Defence Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Purchases
  • Wages
  • Depreciation
  • Other
  • Chart: Cost Structure Benchmarking – Sector vs Defence

  • Basis of Competition
    Barriers to Entry
  • Table: Barrier to Entry Checklist for the Defence Industry

  • Industry Globalization
    There are no major players in this industry. This report includes analysis of other companies.
    Capital Intensity
  • Chart: Level of Capital Intensity for the Defence Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Defence Industry
    Includes:
  • Industry Revenue (2009-2023)
  • Industry Gross Product (2009-2023)
  • Establishments (2009-2023)
  • Businesses (2009-2023)
  • Employment (2009-2023)
  • Wages (2009-2023)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Australian Defence Force (Adf)
  • The military organisation responsible for the defence of Australia, consisting of the Australian Army, Royal Australian Navy and the Royal Australian Air Force.
  • Civilian
  • A person who is not a member of his or her country's armed forces.
  • Combat
  • An engagement fought between two military forces.
  • Peacekeeping
  • The supervision by international forces of a truce between hostile nations or groups.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s Defence market research report can be used to help you: understand market size and growth potential; major companies; draft business plans and pitch books; and conduct benchmarking and SWOT analysis. Our industry analysis highlights macro industry trends in the overall sector and micro trends faced by companies that do business in the industry. The industry report also provides key industry statistics and 5-year forecasts to anticipate future industry prospects so you can decide with confidence.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Defence:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Defence market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Defence, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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