Key points:
- The Australian health and wellness industry is booming, with a 7.1% growth expected over the next eight years.
- Middle market businesses can tap into this growth by updating strategies, investing in R&D, going digital, forming partnerships, and embracing sustainability.
- Success hinges on agility, proactive leadership, and a knack for innovation and collaboration.
The Australian business landscape is rapidly evolving, driven by economic uncertainty, technological advancements, global shifts, and increasing environmental concerns.
As highlighted by the Australian Industry Group, the industries poised for significant growth in the coming decade will be those that harness innovation, digitalisation, sustainability, and resilience to meet the evolving needs of both domestic and international markets.
But what are these sectors, and how can businesses make the most of potential opportunities that each one presents?
Emerging industries to watch
As the national business landscape evolves, there are a number of growing industries that present diverse opportunities for adaptable and agile business owners:
1. Renewable energy
Australia’s commitment to reducing carbon emissions and transitioning to cleaner energy sources is driving growth in the renewable energy sector. According to the Clean Energy Council, Australia’s renewable energy capacity surged to almost 40% of the national electricity supply in 2024, up from 36% in 2023. With the Australian Government aiming to unlock more than $65 billion of investment in renewable capacity by 2030 through the Capacity Investment Scheme, it creates numerous opportunities for middle market businesses involved in solar, wind, and energy storage technologies.
2. Biotechnology
Australia’s biotechnology sector is thriving, bolstered by robust research capabilities and a growing focus on healthcare innovation. The sector contributed $10.8 billion to the Australian economy over the last five years, with an annual growth rate of 2.2% from 2019 to 2024.The COVID-19 pandemic accelerated advancements in medical research, vaccine development, and diagnostics, setting the stage for continued growth.
3. Advanced manufacturing
Advanced manufacturing is transforming traditional production processes through automation, robotics, and digital technologies. The sector is growing steadily year on year, driven by demand for high-tech products and solutions. Innovations in additive manufacturing, smart factories, and material science are creating new avenues for growth.
4. Cyber security
As digital threats become more sophisticated, the demand for cyber security solutions is surging. The Australian Cyber Security Centre (ACSC) reported a 23% increase in cybercrime from 2022 to 2023. With global spending on cyber security expected to exceed $200 billion by 2025, there is a significant opportunity for businesses specialising in this field.
5. Health and wellness
The health and wellness sector is experiencing exponential growth, driven by an increasing focus on mental health, fitness, and holistic wellbeing. Market research by IIMARC indicates that the Australian health and wellness industry is set to grow by 7.1% over the next eight years, offering ample opportunity to capitalise on increased spending and evolving trends.
How to seize the opportunities
For middle market business owners, the emerging industries offer a chance to diversify revenue streams, expand customer bases, and increase any competitive advantage. However, to succeed in these dynamic and highly competitive markets, leaders need to be agile, adaptable, and proactive. Here are some practical steps that can help leaders to make the most of the financial opportunities that growing industries may offer:
- Revisit your strategy: Does your target market and key client or customer provide opportunities to be exposed to these emerging industries? If not, consider adjusting your strategy appropriately.
- Invest in research and development: Innovation drives differentiation. Businesses should prioritise R&D to develop cutting-edge products and services that address customer needs, enhance efficiency, and support sustainability goals.
- Embrace digital transformation: Digitalisation is essential for enhancing productivity and accessing new markets. Investing in digital tools for data analytics, customer engagement, and cyber security will help businesses stay competitive.
- Build strategic partnerships: Collaborations can provide access to new resources, skills, and markets. Strategic alliances with suppliers, distributors, and technology partners can accelerate growth and innovation.
- Adopt sustainable practices: Sustainability is both a responsibility and an opportunity. Implementing green practices and seeking government incentives for environmental initiatives can improve business reputation and attract eco-conscious consumers.
- Be prepared: Opportunities may present themselves that need a business to be nimble and act quickly to make the most of potential benefits. Ensuring your business is appropriately resourced from a finance perspective is a key step in enabling this to happen. Moreover, having the right team (in capability and capacity) is critical to drive long term success.
The Australian business landscape is poised for transformation as emerging industries redefine traditional models. For middle market business owners, these changes present both challenges and opportunities.
By embracing innovation, digitalisation, collaboration, and sustainability, businesses can pivot successfully and capitalise on the growth prospects offered by emerging sectors. The future of Australian business is promising for those who are agile, proactive, and are willing to adopt an entrepreneurial spirit.
Those that are willing to adapt businesses processes, surround themselves with trusted advisors and make sound data-driven decisions should be able to ride the wave of these emerging industries.
