With the festive season just around the corner, a new survey reveals retail and hospitality businesses are picking it will be cracker year.
According to the latest MYOB Business Monitor, 47 per cent of local businesses in these sectors report they are busier than normal for this time of year. This has come off a good year with 32 per cent reporting an increase in revenue over the past 12 months.
MYOB New Zealand Head of SME Ingrid Cronin-Knight says the retails and hospitality sectors are in good shape and she’s hearing positive sentiment from business customers.
“These sectors continue to grow and have really established themselves as one of the leading lights in New Zealand’s economy. Optimism is crucial and there is confidence from within the sectors that the positive trends will continue well into the future.”
Forty-four per cent of SMEs in the two sectors believe the economy will continue to improve over the next 12 months and just under half (49 per cent) believe they will see further increases in revenue. This is ahead of the national average of 42 per cent.
The retail and hospitality sectors lead when it comes to being digitally connected with 86 per cent having an online presence, well above the national average of 50 per cent. Twenty-three per cent operate a website, while 17 per cent use social media and 41 per cent do both.
Ms Cronin-Knight says the strong use of online technology is an important factor for every business, with the ability to increase revenue, bolster customer engagement and also aid communication.
“The retail and hospitality sector has always been good at using technology in such a way that it benefits their business,” she says.
“It’s great to see businesses in these industries doing all they can
to ramp up their online presence in the face of increasing
Cash flow an added pressure
Cash flow is the greatest concern for operators in the retail and hospitality industries, with 30 per cent reporting being under extreme pressure – up from 21 per cent in June.
Other pain points include attracting and retaining customers (27 per cent), tax compliance obligations (26 per cent) and competitive activity (26 per cent).
“While many businesses are busier than usual, they are still concerned about cashflow. Many of them are operating with tight margins so people should get out this season and support our retailers, restaurants, cafés and bars,” Ms Cronin-Knight says.
“We’re also looking at pressure generated from greater competition
and other flow-on effects of continued growth, which in themselves
aren’t terrible problems to have, provided businesses feel supported
and can plan based on good financial information.”
Pay rises on the horizon
A third of the retail and hospitality sector plan to increase the amount they pay their employees within the next 12 months – well above the national average of 22 per cent.
The number of businesses increasing their range of products and services on offer is also above average (42 per cent, compared to the average of 24 per cent) and 39 per cent are looking to boost price margins.
Ms Cronin-Knight says not only is this good news for those working within the sector, but also for the broader economy.
“These are some really positive signs of growth, which of course supports local jobs throughout New Zealand.
“The continued success of the retail and hospitality sector in New Zealand requires careful management and the fact the industry has continued to do so well is testament to the hard work the businesses are putting in now, and have continued to put in over time.”
For further comment or other information please contact:
Conor Roberts, MYOB NZ Communications and Public Affairs
M: 021 124 6004 / E: email@example.com
Gerard Blank, The Agency Communications Limited Director
P: 03 341 5841 / M: 0275 243 629 / E: firstname.lastname@example.org
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.
About the MYOB Business Monitor
The MYOB Business Monitor is a national survey of 1,000+ New Zealand
small and medium business owners and managers, from sole traders to
mid-sized companies, representing the major industry sectors. It has
run since 2009, commissioned to independent market research firm
Colmar Brunton. This most recent survey ran in July/August 2016. The
Monitor researches business performance and attitudes in areas such as
profitability, cash flow, pipeline, technology usage and the
government. The weighting of respondents by both geographical location
and sector is based on overall market proportions as established by
Statistics New Zealand and is drawn from an independent survey group,
which includes both MYOB clients and non-clients.