In line with the results from 2010, most medium-sized international companies are primarily looking for growth from within their core sector.
In total, 70% of the CFOs interviewed state that their company is looking to expand predominantly within their core sector: this is similar to the 69% in 2010. Only 5% expect expansion to come from new sectors, which is a decrease from the 15% reported last year. This may be a reflection of this year’s sample who are CFOs only, rather than the broader range of senior executives that we spoke to in 2010. Nevertheless, 25% of the CFOs interviewed for the 2011 survey expect expansion to come from both their core and new sectors.
There is a greater likelihood of concentration on core sectors within Europe – especially France, India and Japan. Meanwhile, 41% of Chinese CFOs point to both core and new sector expansion and 22% of Saudi Arabian businesses expect to expand in new sectors – a far higher proportion than that reported in the other twelve countries.
Q: Thinking about international expansion, in the next 3 years is your company looking to expand primarily within your core sector, primarily into new sector, or both?
When asked about their plans to expand with existing, or both new and existing, products and services respondents were equally split: 46% each. Japanese companies are far more likely to state that their businesses will concentrate on existing products and services (84%) and German, Dutch, Russian and Chinese businesses are all more likely than average to expect a more mixed approach. Saudi Arabian businesses are the most likely to be expanding with new products and services (26%), ahead of Brazil (18%) and significantly ahead of an overall mean of 9%.
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Q: Thinking about international expansion, in the next 3 years is your company looking to expand with your existing products and services, primarily with new products and services, or both?