A close look at AIBS respondents

12 Dec 2017

Tags

  • Divya Skene
  • AIBS 2017

The AIBS series of surveys seeks to understand more about our internationally-active firms and this blog on the 2017 survey introduces the majority of our respondents – 941 internationally active companies[1].

Respondents by industry – the survey represents a balance of good and services firms

Over fifty per cent of AIBS respondents this year identified their main business as a services operation, and just over forty per cent of survey respondents categorised their main business as within a goods industry, defined here as agriculture, mining or manufacturing.

  • Given that official data on services exporters can be difficult to come by, the survey provides us with some useful insight on this important sector.
  • A large percentage of AIBS respondents are manufacturing firms – about one third of survey respondents identified the manufacturing industry as representative of their main business.

Industry of respondents, top ten respondent industries

How does the industry of AIBS respondents compare to the population of all exporters?

We don't have complete official data on the industry share of exporters of both good and services, but we do have data on the industry share of goods exporters[2]. This data is shared below, alongside a chart of AIBS respondents that sell goods overseas.

Comparison of population with AIBS sample, Exporters selling goods, by industry

A key visible difference between the industry shares in these two charts (representing the population of goods exporters as recorded by the Australian Bureau of Statistics (ABS) (Figure 2, LHS) and the AIBS sample (Figure 2, RHS)), is that the AIBS sample has a smaller share of goods exporters from the wholesale trade industry and an increase in goods exporters from the agricultural and manufacturing sectors.

It is also worth mentioning a key difference in measurement between these two sets of data. The ABS figures on the left are for the final goods exporter – that is, the last organisation to 'touch' the product before it is traded across borders. In this dataset a wholesale trader or other service provider may, for example, be the last Australian company to touch the traded goods and therefore be recorded as the sole goods exporter, while the actual goods traded may be produced by companies for export markets that go unrecorded by this ABS measure. In the case of AIBS we capture all firms that know that they are selling goods or services that will ultimately be sold overseas, including in some cases via an Australian retailer or wholesaler. In this way, our survey may pick up export-producing agricultural and manufacturing companies that are not picked up by the ABS, conceptually 'replacing' some of the wholesale traders in the total count.

Respondents by revenue – the survey has a SMEx focus

A profile of the international revenue earned by our sample is below.

Figure 3 shows that AIBS survey respondents overall are mainly small and medium sized exporters (or SMEx – those firms earning international revenue between $250,000 and $50m).

The interactive chart allows users to see how the international revenue profile of respondents changes across top industry categories.

Respondents by market – the survey confirms the importance of ASEAN, US and China at a firm level

Over the last few years, the AIBS survey has consistently reflected the importance of the United States and China as key markets for our respondents. This year is no different, with 45 per cent of all respondents naming either China or the US as a top one or two revenue market.

Figure 4 illustrates the fact that the ABS data on total export values show that in 2016 the value of our exports to China was more than four times the value of our exports to the United States.

Top revenue markets for AIBS respondents, %

However AIBS survey data and other firm-level data that we have indicates that at a firm-level, the United States and China are generally on par as top markets based on the number of firms selling into the market, as opposed to the total value of exports sold. Together these findings offer another (firm level) perspective on the question of which of these two markets is most important to Australia).

Interestingly, in terms of business counts the AIBS survey shows the ASEAN region is an even more important international revenue earner at a firm level, with more AIBS 2017 respondents earning their highest revenues in an ASEAN market (29 per cent) than in China (23 per cent) or the US (22 per cent).

This firm-level data also gels with other official firm-level data that we have, which shows ASEAN is indeed a top export destination and source of revenue for all goods exporters, especially those SMEx exporters earning between $250,000 and $50m in international revenue.

Firm-level data on ASEAN (goods exporters)

Other interesting revenue characteristics of our sample:

  • nineteen percent of AIBS respondents earn more than 50 per cent of their total revenue from international revenue
  • 35 per cent of respondents earn international revenue from six or more countries.
  • 43 per cent of respondents for whom China is a top revenue market, generate over half their international revenue from China (and similarly, 42 per cent of those for whom the United States is a top revenue market earn over half their international revenue from that market).
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[1]  AIBS 2017 also captures the views of more than 100 businesses that are not currently involved in international business – the subject of a future post.
[2]  The ABS does provide some detail on services exporters by type of service in the Characteristics of Australian Exporters, but this publication only captures about 38 per cent of services exports by value.