|  2013-05-30

Romanian CEOs are more optimistic than their global counterparts when it comes to their companies’ prospects for revenue growth

CEOs in Romania seem to have regained trust in their companies’ growth perspectives, both on short and medium term. 42% of the respondents declared to be very confident in their company’s growth during the next year and 60% of CEOs share this opinion when it comes to growth perspectives for the next three years (in comparison to 36% and 46% respectively, at the global level).

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“This optimism seems somewhat out of touch with the global growth perspectives, as opinions on the general economic situation are rather reserved.  Romanian CEOs show that they learned to rely only on themselves in order to generate revenue growth in the current economic environment”, stated Vasile Iuga, Country Managing Partner, PwC Romania.


47% of our respondents anticipate that the economy will stagnate this year, and 38% are even talking about a decline of the economic conjunction (compared to the global average of 28%).


Most CEOs will be focusing on opportunities for organic growth in internal market (33%) and on developing new products and services (29%), whereas only 5% of respondents are considering new external markets. On the other hand, 15% of respondents consider that the expansion of their operations in existent external markets is the best option for their future growth. At the same time, it seems there is an increased appetite for mergers and acquisitions, joint ventures and strategic alliances, as 18% of the respondents place their stakes on these growth strategies, compared to only 5% in last year’s edition.


The risks

On a frail market, which has many times deceived the business environment’s hopes for recovery, CEOs in Romania say that the economic volatility represents the main risk for their companies (87%, compared to only 64% last year). Even more so, our respondents are very preoccupied with the authorities’ potential response when it comes to the budgetary deficit (84% compared to 52% last year), as well as with the increasing fiscal burden (67%), while 62% indicated overregulation as a potential threat and 82% are worried about the volatility of the currency exchange rate.


Only 5% of CEOs anticipate a break of the Euro zone (compared to the 16% recorded in the USA and globally, as well as to the 12% in Europe). However, 58% of the participants in the survey are mentioning that such a scenario would have a significant impact on their companies (58%).


Changes in business strategy

In the current economic context, most respondents are trying to consolidate their market position and are not expecting major strategy changes during the next period of time (27% are not anticipating any change of strategy, while 58% are considering some adjustment). On the other hand, 15% are considering a radical change in their business strategy, as their current business model appears to have reached its limits.


Out of those who are considering some changes, the majority will focus on attracting and ensuring customers’ loyalty (84%). Other changes will be operated in the organizational structure (69%) and in talent management (69%). Moreover, 65% of companies will take measures in the field of mergers and acquisitions, joint-venture projects and strategic alliances.


During the past 12 months, 96% of the companies participating in the survey have implemented cost reduction measures, 36% of respondents have externalized some processes and functions, and 31% have entered strategic alliances and joint venture projects. Cost reductions remain on the CEOs’ agenda, as 85% of the respondents are considering several such initiatives. At the same time, 44% of CEOs are considering closing new partnerships and strategic alliances, while 35% are looking into mergers and acquisitions on the internal market.


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