In the survey report "Redefining Business Models: Colliding, Surviving or Thriving?" KPMG specialists have presented analysis of answers and data from over a hundred businesses operating in ten countries of the Central and Eastern Europe (CEE) as well as the North-Western region of the Russian Federation. To assess the companies' financial performance KPMG specialists analyzed three criteria: growth, profitability and productivity. As a result, key success factors as well as operational performance results of consumer and industrial manufacturing companies in the region were identified.

The analysis of the past year's activity and figures shows that manufacturers had overall business growth of almost 15%, productivity growth of 10% and only a slight increase in employee growth. It is notable that Russia and Romania have showed higher results in all three categories than Czech Republic and Poland.

David Bamber, KPMG North-West Managing Partner has comments: "The high level of productivity will position Russian business well to come out of the crisis and grow successfully. However, companies may want to look beyond just labor productivity for growth opportunities. A very high number of Russian companies indicated the need to formulate and develop strategy along with putting more focus on customer base and market share growth. While those might seem like huge tasks to master, it is essential to recognize the importance of rethinking one's strategy to address post-crisis market conditions and differentiate yourself from competitors in order to thrive. It is encouraging to see that so many of our survey participants are focused on just that. It sends a message that business are adaptive and responding to market conditions and understood that the pre-crisis business realities may no longer apply."

In comparison with a similar survey carried out by KPMG in CEE in 2005, just over 5% of companies were loss-making, while in this year's survey more than 20% of companies reported losses. This year's survey showed a higher percentage of profitable companies in CEE and Russia: over 20% of respondents indicated revenue before tax growth of over 15%, while n 2005 less than 15% of companies showed such results.

As far as the expectations for revenue and sales growth, over 30% of the North-Western region respondents expect revenue growth of over 15% in three years and over 50% of respondents expect sales growth between 10-20%.

In the area of productivity chemical and process industries showed the highest results because these industries rely on plant and equipment while others rely more on people. The picture looks the opposite in automotive, where most companies use assembly processes which are mostly manual.

"It is fortunate for the North-West region of the Russian Federation to have the economy that relies on so many industry sectors which vary from oil and gas to pulp and paper, automotive, IT and communications, retail, metallurgy, food and drink manufacturing and heavy industry. That in combination with supportive government initiatives will position the region as a strong economy and will not only allow business to come out strong from the economic crisis but will also continue to be an attractive target for investors in the future" said David Bamber.

Please find a full version of the survey here.