Growth steady for small businesses according to survey
09 Oct 2017
37 per cent report an increase in revenue since last year
46 per cent expect revenue to increase over the next 12 months
New Zealand’s small to medium enterprises (SMEs) are enjoying a period of sustained growth with the expectation this will continue over the next 12 months, according to the latest research by leading accounting software provider MYOB.
In the latest MYOB Business Monitor Economic Snapshot of 400 SMEs nationwide, 37 per cent reported a revenue increase in the last year, tracking slightly up from 36 per cent in March, with almost half (46 per cent) expecting their revenue to increase over the next 12 months.
Fewer businesses are struggling in the current environment, with just 15 per cent of SME operators reporting their revenue decreased over the last year, down from 19 per cent in February, and 20 per cent in September last year.
MYOB New Zealand General Manager Carolyn Luey says SMEs have worked hard to put themselves in this position, and many are now enjoying a period of steady growth.
“Since they recovered from the GFC, we’ve seen the performance of local SMEs steadily improving. And looking ahead, local businesses see no reason for their stellar run to end.”
Ms Luey says the survey also reinforces that growth is not just confined to the main centres, with the regions also showing significant improvement.
“A trend we’ve seen over the last few years of our research is that SMEs across many of New Zealand’s regions are experiencing a period of sustained growth.”
“For example, 44 per cent of operators in Waikato and the Bay of Plenty saw their revenue improve in the last 12 months, with similar levels of growth seen in Otago/Southland.”
On the back of their own performance, the MYOB Business Monitor Economic Snapshot highlights that SMEs are confident in the New Zealand economy.
Close to half (42 per cent) believe New Zealand’s economy will improve over the next 12 months, while almost a quarter (23 per cent) think it will decline.
“Confidence in the economy from the small and medium-sized business sector is good for the whole country. It means more businesses are willing to invest and therefore increase employment opportunities,” Ms. Luey says.
However, Ms. Luey says some sectors are less positive – particularly those which are exposed to the slowing property market.
“Only 32 per cent of businesses in the construction and trades sector expect the economy to improve next year, while 29 per cent say it will decline,” says Ms Luey.
“By contrast, the tourism sector is clearly preparing for another good year, with half of all businesses in the retail and hospitality industry expecting the economy to grow.”
While there is growing confidence in the economy, the new Government will have to look carefully at what they can do to help maintain it, especially in terms of policies focused on education, training and immigration.
“This is really noticeable in terms of finding the right people to fill skills gaps,” says Ms Luey. “Forty-one per cent of respondents said their industry is experiencing a skills shortage – and in areas like Canterbury where the rebuild is ongoing, almost half (47 per cent) of SMEs said finding staff with the right skills is one of their greatest challenges.
“According to our latest MYOB Snapshot, New Zealand’s larger SMEs – those who employ 10 or more people – are finding it the hardest to recruit the staff they need.”
Of those who employ 10-19 people, 68 per cent said they find it difficult to find suitable staff, while 32 per cent of businesses with 2-4 employees said the same.
“The ongoing skills shortage is continuing to bite across a range of industries, with 67 per cent of the transport industry, 50 per cent of the retail and hospitality sector and 47 per cent of the construction and trades reporting a skills shortage in their industry.”
“The skills gap is a huge issue facing the new government. It will need to look at what policies are needed to support SMEs growth and attract the right people to work across a broad range of sectors.”
For further comment or other information please contact:
Conor Roberts, MYOB NZ Communications and Public Affairs Manager
M: 021 124 6004 / 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.
About the MYOB Colmar Brunton Business Monitor Snapshot
The MYOB Business Monitor is a national survey of 400 New Zealand small and medium business decision makers, from sole traders to mid-sized companies, representing the major industry sectors. Commissioned to independent market research firm Colmar Brunton this survey ran from 5th-6th September 2016. The Monitor Snapshot provides insight into issues currently affecting New Zealand’s SMEs, as well as information on performance and the economy profitability. 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.