Australia likes to think of itself as a leader in consumer packaged goods (CPG): premium, innovative, globally relevant.
But when you step back and compare us to powerhouse markets like the United Kingdom and the United States, the cracks begin to show.
Not in talent.
Not in ambition.
But in speed, structure, and support.
While international markets are fuelling innovation, backing bold brands, and embracing early-stage risk, Australia is playing catch-up. And in a global CPG market that’s moving faster than ever, that delay could be the difference between building a brand that thrives – or one that stalls before it scales.
The Talent Is There, But the System Isn’t
Australia doesn’t lack great founders – what we lack is a system that helps them move at the same pace as their global peers.
Here’s what becomes clear when you look offshore:
1. Innovation Moves Faster Elsewhere
Australia ranks 16th in the world for innovation inputs, but slips to 27th for innovation outputs.
In simple terms this means we’re great at research and ideas. But we struggle to turn those ideas into real-world products that reach consumers quickly.
By comparison, the US ranks 3rd for inputs and 6th for outputs. Why? Because of a culture of iteration, speed, and commercialisation. The UK outperforms us too – sitting at 10th and 4th, respectively.
2. Founders Overseas Have Access to More Capital
Australian equity funding for beauty brands rose from $3.74 million to $15.4 million in 2024; a promising increase. But in the same year, the US poured $241 million into the same category. Yes, the US is a much larger market than Australia, but the funding gap is still disproportionately wide.
Australia’s funding environment is small and cautious. Nearly 40% of early-stage deals rely on foreign capital, and investors tend to favour software and fintech over food or beauty.
The result of this lack of funding – particularly for smaller, emerging brands – is that too many consumer brands get stuck between proving their concept and finding the funding they need to scale.
3. We’re Risk-Averse – and It’s Slowing Us Down
Culturally and financially, Australia has a low appetite for risk. Failure still carries a stigma. And investors here often want to see revenue before they’ll open their wallets.
In the US and UK?
Investors back bold ideas earlier. They understand that speed matters, especially in fast-moving consumer categories. So they fund iteration, support pivots, and know that risk and reward go hand-in-hand.
So, What Happens?
We incubate great founders, we grow solid brands, and then, when those businesses need serious backing… they head offshore.
Because the capital, the support, and the scale-up systems just aren’t available here. Not in the way global brands need them to be.
Playing It Safe Is No Longer Safe
In 2024, roughly 75% of global CPG growth came from price increases – not volume. In other words, the industry isn’t growing through new customers or new products. It’s inflating, which is not sustainable.
At the same time, private label is booming. In Australia, it now makes up 36% of CPG sales, up nearly 5% year-on-year.
Translation? If you’re not innovating, you’re losing ground. Fast.
Markets that are thriving aren’t doing so by playing it safe. They’re investing early in:
- R&D and emerging tech.
- Faster go-to-market models.
- Diverse leadership and lived consumer insight.
Meanwhile Australia is still doubling down on what’s worked before. But in today’s market, what worked before is no longer enough.
We Can’t Afford to Fall Behind
When innovation stalls, the impact is felt everywhere:
- Supermarket shelves start to look the same.
- Breakthrough ideas get stuck in development.
- Founders burn out waiting for funding.
- Capital flows offshore.
- Global brands set the pace – not us.
Once we lose momentum, it’s hard to get it back. And in CPG, timing is everything.
But There’s Hope, and Opportunity
Here’s the nuance: Australia has something many markets don’t.
We’re one of the best test markets in the world for consumer brands.
Why?
Because we have a trend-aware, multicultural middle class with spending power, a concentrated retail environment, and high digital adoption. That makes us ideal for testing product-market fit in a controlled, feedback-rich environment.
Australia can be a launchpad. Not a laggard.
But only if we modernise how innovation is funded, supported, and scaled.
The Real Question
Do we want to be a market that follows global trends, or one that sets them?
The future of CPG won’t wait. The brands that win will be the ones pushing boundaries, taking smart risks, and scaling fast.
And if we want Australian founders to lead, we need to back them like they can.
And we need to do it now.