Riskiest Industries in Australia in 2020

1. Tobacco Product Wholesaling in Australia

2020 Overall Risk Score: 6.4

The Tobacco Product Wholesaling industry has faced declining consumer demand and rising prices over the past five years. The entries of Philip Morris Australia and British American Tobacco caused industry revenue to spike over 2015-16. However, industry revenue has stabilised over the past four years, as rising prices and excise taxes have offset declining smoking rates and fluctuating demand from downstream retailing industries. Overall, industry revenue is expected to grow at an annualised 1.0% over the five years through 2020-21, to total $2.9 billion. This growth includes an anticipated 2.0% increase in the current year, largely due to the government... Learn More

2. Paint and Coatings Manufacturing in Australia

2020 Overall Risk Score: 6.2

The Paint and Coatings Manufacturing industry is a key component of Australia's broader chemical manufacturing sector. The industry includes major players with strong national and global brand names across different pricepoints and product segments, which are vertically integrated. As a result, competition occurs across the supply chain, rather than just at the manufacturing level. Furthermore, as these operators are global players, consolidation trends currently characterising the global paint and coatings sector are influencing the Australian marketplace. For example, DuluxGroup is now a subsidiary of the Japan-based Nippon Paint, following an unsolicited $3.8 billion offer in April 2019. DuluxGroup was previously... Learn More

3. Fruit and Vegetable Processing in Australia

2020 Overall Risk Score: 6.2

Industry operators have faced tough trading conditions due to increasing external competition over the past five years. Rising import penetration and high operating costs have negatively affected the industry's performance, reducing the competitiveness of industry products in overseas markets. Lower prices also made imports preferable over domestic products. Therefore, imports have surged as a share of domestic demand over the past five years, encouraging some domestic processors to relocate manufacturing offshore or invest in automation to reduce labour costs. Moreover, supermarkets have increasingly sourced processed goods from overseas for their private-label brands. Consequently, the rising popularity of private-label products has... Learn More

4. Uranium Mining in Australia

2020 Overall Risk Score: 6.2

Australia has an estimated 31% of the world’s uranium reserves, but accounts for only 12% of global uranium output. Government reluctance to establish new uranium mines has meant a considerable share of Australia’s uranium resources has been left untouched. The Uranium Mining industry has displayed high revenue volatility over the past five years due to fluctuating prices and export volumes. Industry revenue is expected to increase at an annualised 1.2% over the five years through 2019-20, to $620.8 million. A rise in uranium prices is anticipated to be counteracted by a decline in output in 2019-20, leading to a 6.3%... Learn More

5. Synthetic and Natural Textile Manufacturing in Australia

2020 Overall Risk Score: 6.1

The Synthetic and Natural Textile Manufacturing industry consists of three primary segments: wool scouring, synthetic textile manufacturing and natural textile manufacturing. Industry operators have struggled with difficult trading conditions over the past five years, which have caused revenue to decline. Industry operators have been exposed to intense competition from overseas low-cost manufacturers, with imports accounting for a large proportion of domestic demand. Industry operators have also been vulnerable to exchange rate fluctuations, as the industry heavily relies on exports. Ongoing contractions in domestic downstream industries have further constrained revenue, as demand for industry products from textile product manufacturers has fallen.... Learn More

6. Elevator Installation and Maintenance in Australia

2020 Overall Risk Score: 6.1

The Elevator Installation and Maintenance industry installs, maintains and repairs elevators, escalators and moving walkway systems (travelators) on buildings and other structures, particularly in multistorey developments. Trends in non-residential and residential construction heavily influence the industry's performance. In particular, the increasing density of residential areas has resulted in significant volumes of high-rise apartment construction. The industry is dominated by four major players that are subsidiaries of global manufacturers, and suppliers of elevators and other building equipment. Smaller industry contractors tend to focus on maintaining and refurbishing existing elevator and escalator systems, and undertaking subcontracting work on emergency repair services.

Industry revenue... Learn More

7. Aluminium Door and Window Manufacturing in Australia

2020 Overall Risk Score: 6.0

The Aluminium Door and Window Manufacturing industry produces architectural aluminium products used in both residential and non-residential properties. Manufacturers rely on downstream demand from building construction developers as the industry's products are often installed in new buildings. Residential building construction has declined from a peak in 2017-18, contributing to declines in industry revenue over the past five years. Overall, industry revenue is expected to decline at an annualised 2.1% over the five years through 2019-20, to $4.2 billion.

The industry benefited from growth in residential property construction over the three years through 2017-18, which supported demand for industry products commonly fitted... Learn More

8. Coal Mining in Australia

2020 Overall Risk Score: 6.0

Black coal is a key input into steelmaking and energy generation. Although black coal deposits are found all over the world, Australia is one of the world's lowest cost producers and a major black coal exporter. Domestic reserves exceed domestic demand, are high grade and economical to access. As a result, exports account for a large share of industry revenue. Imports are negligible in the industry, as total local production has been higher than domestic demand for black coal. Brown coal is used domestically for electricity generation in Victoria.

Industry revenue is expected to rise at an annualised 7.8% over the... Learn More

9. Metal Cladding, Waterproofing and Scaffolding Services in Australia

2020 Overall Risk Score: 6.0

The Metal Cladding, Waterproofing and Scaffolding Services industry provides a diverse range of services that meet demand from many segments of the building, infrastructure and industrial markets. The industry derives most of its revenue from fixing metal cladding and waterproofing services for buildings. The industry also has several specialist service segments, including providing scaffolding services for high-rise and wide-span buildings; providing scaffolding services for mining and infrastructure applications, such as telecommunications towers and oil rigs; sand blasting building exteriors; waterproofing infrastructure, such as tunnels; and installing, maintaining and removing petrol bowsers.

Industry revenue is expected to increase at an annualised 2.6%... Learn More

10. Carpet and Textile Floor Covering Manufacturing in Australia

2020 Overall Risk Score: 6.0

Operators in the Carpet and Textile Floor Covering Manufacturing industry have faced weak demand growth over most of the past five years, along with declining enterprise numbers, and lower industry employment. Furthermore, industry revenue growth has been constrained by declines in dwelling commencements, steady increases in competing imports, and greater competition from substitute flooring products, such as tiles and wooden floorboards. However, higher demand from non-residential markets, and from multi-unit apartment and townhouse construction, has contributed to revenue growth over the period. New carpet designs and colours have provided the industry with new products to supply to clients, which has... Learn More