An Analysis of Meriton Group Company and the Australian Construction Industry

MERITON COMPANY 1
AN ANALYSIS OF MERITON GROUP COMPANY
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MERITON COMPANY 2
Company and Industry Description
An overview of Meriton Group Company
Meriton Group Company is a privately owned Australian construction company which
deals with the development of apartments and building of residential homes. The
company was founded during the year 1963 by the managing director, Harry Triguboff
AO. The company has a significant contribution to the Australian construction sector
and the entire economy. It has been ranked as the Australian largest apartment
developer and also the biggest constructor of residential homes in Australia. The
company solely bases its operations in Australia having majorly focused on Queensland
and New South Wales. It has its headquarters in New South Wales in Sydney city which
is among the biggest cities in Australia. Since its establishment, the company has built
more than 75000 residential apartments some of which are ranked among the tallest
towers made for residential purpose in Australian east coast region “(Anon, Managing
Director)”. Apart from construction of residential apartments, the company also offers
various services some of which include leasing, sales, and management of the property
and also luxurious accommodation services under its brand by the name Meriton suites
which operate in more than 18 locations in Australia. The total number of qualified staff
employed by the company is estimated to be 950 “(Anon, TOP 500 PRIVATE
COMPANIES, 2018)”. This is quite a huge number as compared to many construction
companies which only employ less than 20 employees. The company contributes
approximately 0.05% of the gross domestic product of Australia. This is a significant
contribution towards the Australian economic growth as a few companies can
individually reach this level especially in the construction industry where the majority of
companies are small while others are sole proprietorships which rarely employ people.
In a nutshell, Meriton Group Company has been performing well since its establishment
and has expanded at a fast pace and better results are anticipated in the future as the
Australian housing sector is doing well.
“An Overview of the Australian Construction Industry”
The Meriton Group Company is in the Australian construction industry. The construction
industry of Australia contributes significantly to the nation’s economic growth. It has
been ranked position three industry in Australia after the mining and the finance
industries. The industry has its operations both in the Australian private and public
sectors in three main categories of activities namely the Engineering construction,
residential and non-residential constructions. Businesses operating in the sector are
approximated to be 348400 according to the “Australian Bureau of Statistics” register.
The industry raises an estimate of $365 billion in terms of revenue to the Australian
economy. With this revenue, the industry contributes around 8 percent of the Australian
total gross domestic product which is a significant contribution towards the nation’s
economic growth (“Australian Industry Group, 2015”). Considering employment,
currently the industry employs more than one million people which statistics showing
that employment in the industry has been on the rise since the year 2012. This
represents approximately 9 percent of the total Australian labor force. The following
data shows the industry’s total employment from the year 2012 to 2018.

MERITON COMPANY 3
Year
Number of employees
(000s)
2012 983.5
2013 989.4
2014 1027.1
2015 1040.6
2016 1088.4
2017 1131.7
2018 1179.1
The graph for the data is as shown below.
2012 2013 2014 2015 2016 2017 2018
850
900
950
1000
1050
1100
1150
1200
Number of employees (000s)
Number of employees
(000s)
Year
Employed People (000s)
From the data obtained, it is evident that the industry has been expanding for the past
years with statistics showing that the industry’s productivity has been increasing by
approximately 2.8 percent on an annual basis. The industry’s growth is estimated to be
2.5 percent for the five years and hence its contribution towards the nation’s overall
economic growth is anticipated to increase in the future. The industry’s excellent growth
has been contributed by various factors such as the Australian population growth rate
which has been noted to be 1.6 percent on annual basis, improvement in the Australian
housing sector (Paris 2017, p.17) and the nation’s improvement in construction
technology especially the adoption of construction software which enables the industry
to save over $25 billion annually among others.
The Market Structure of the Australian Construction Industry
Based on the number of businesses and the market share, the Australian construction
industry can be categorized as a monopolistic competition market structure (Bertoletti
and Etro 2016, p.1217). The industry consists of many businesses which are estimated
to be 348400. The businesses operating in the industry are classified into sole