Optimism high for Gen Y
30 Aug 2016
Online marketing tools key to combat pressures
Generation Y business operators are showing high levels of optimism and technology usage despite increased business pressures, according to a ‘Youth Business Snapshot’ from leading accounting software provider MYOB.
The research analyses responses from SME operators aged between 18 and 34 to the MYOB Business Monitor survey run in conjunction with Colmar Brunton. It found 43 per cent of young business owners reported their business revenue was up on the previous year and only 17 per cent experienced a decline. Looking ahead, half expected their revenue to rise during the coming year, while just 12 per cent thought it would decline.
MYOB Head of SME New Zealand Ingrid Cronin-Knight says these results are a positive indicator for the future of local business.
“Most young business people are in the early or growth stages of their operations, so it is great to see so many of them already thriving and optimistic for the future,” she says.
“This generation of business operators have also indicated high levels of investment planned across many areas of their business this year, which speaks volumes about the speed at which they are growing and their confidence in the future.”
The top five areas of investment planned for Gen Y businesses in 2016 were:
- Marketing and advertising the business online - 40%
- IT systems and processes - 34%
- Number of full time employees - 34%
- Number or variety products and services - 31%
- The sale of products/services online - 31%
Young business owners feeling the pressure
However, despite a high rate of optimism MYOB’s Youth Snapshot also found young business owners are feeling business pressures more acutely than the average SME in the study.
The top five business issues that Gen Y SME operators reported extreme or quite a lot of pressure from were:
- Attracting new customers – 34% (21% all SMEs)
- Competitive activity – 34% (24% all SMEs)
- Cashflow – 33% (25% all SMEs)
- Price margins and profitability – 29% (22% all SMEs)
- Business finance / funding / overdraft – 26% (15% all SMEs)
For 22 year old business owner James Koo, finding the right investor was a challenge when expanding Niesh, his printing service for university students.
“Not only did we want to find an investor who shared our vision for Niesh, but due to our ages and inexperience we had the added complication of being taken seriously and appearing credible to potential investors,” says Mr Koo.
The business, started just last year by Mr Koo and his two co-founders Mr Lee and Mr Yoo, has grown rapidly from a small station borrowing the space of a shop on Queen Street, to a business employing 5 staff and occupying a premises on Symonds Street.
“Our business, which uses corporate advertising to provide a free printing service, has had the added challenge of building awareness amongst university students. We have really needed to utilise online tools in order to market our business.”
Online is key for Gen Y
MYOB’s Youth Snapshot discovered 62 per cent of Gen Y operators had an online presence for their businesses – in the form of a website, a social media site specifically for the business, or both.
“This is a high percentage of online businesses, particularly if you compare it to our last Business Monitor results which showed only just over half of all SMEs have an online presence,” says Ms Cronin-Knight.
“We also note one third of operators in the 18 to 34 age group said they were connected to ultra-fast broadband. Younger business owners know good internet access is vital to their success so UFB take up will undoubtedly continue to increase amongst this group.”
“Online technology has been essential for our rate of growth,” says Mr Koo.
“Our target market – university students – are extremely high users of online technology so it makes sense that we would promote our business online. Our Facebook and Instagram accounts, as well as using new features such as Facebook live streaming, are great ways for us to connect with current and potential customers.”
MYOB is seeing more young business owners making use of the latest business management tools like cloud accounting and payroll, and tools like mobile payment solutions.
“Young people are amongst the most innovative and exciting business owners in New Zealand today. Businesses like Niesh are bringing new products and services to market in impressive numbers and their optimism and outlook is hugely encouraging for our country’s economic future,” says Ms Cronin-Knight.
“The businesses that our young entrepreneurs create today have the potential to be the large corporations of tomorrow. As our Gen Y SME operators grow their businesses we look forward to being with them every step of the way.”
For further comment or other information please contact:
Rebecca Huang, MYOB NZ Public Relations Consultant
M: 021 1122 720 / E: firstname.lastname@example.org
Gerard Blank, The Agency Communications Limited Director
P: 03 341 5841 / M: 0275 243 629 / E: email@example.com
MYOB (ASX:MYO) is a leading cloud based business management solutions provider. It makes business life easier for approximately 1.2 million businesses across Australia and New Zealand by simplifying accounting, payroll, tax, practice management, CRM, websites, job costing, inventory and more. MYOB provides ongoing support via many client service channels including a network of over 40,000 accountants, bookkeepers and other consultants. It is committed to ongoing innovation, particularly in cloud computing solutions, and in 2015 was awarded the BRW award for the most innovative large company for 500+ employees and placed 2nd in BRW’s Most Innovative Companies Award list across all categories nationally. For more information, visit myob.co.nz or follow @MYOB on Twitter.