Businesses confident in economy
While small businesses have confidence in the New Zealand economy, their optimism has not translated into faith in their business, a new survey shows.
The Asia Pacific Small Business Survey of 2105 small businesses in the region carried out by accounting body CPA Australia showed Kiwi small businesses were the third most confident in their local economy for 2014, behind Indonesia and Australia.
Out of the 307 New Zealand respondents, 53 per cent thought the economy would grow in 2014, up from 46 per cent in 2013.
However, the upswing in economic confidence did not flow into business confidence, with only 57 per cent of small businesses expected to grow in 2014, down from 64 per cent in 2013, the results showed.
The percentage of businesses that expected to decline or shut down in 2014 was 13 per cent, up from 10 per cent the previous year, but some New Zealand businesses said they were not seeking growth or were actively shrinking their business in preparation for retirement, CPA Australia said.
Meanwhile, only 13 per cent of businesses said they planned to increase staff numbers next year.
CPA Australia chief executive Alex Malley said the New Zealand results were a surprise but not a major cause for alarm.
"The fact is that the New Zealand economy is strong and on most indicators this strengthening looks set to continue to 2014."
It appeared difficult trading conditions and increasing cost pressures were holding the sector back, he said.
More than one third of New Zealand businesses found trading conditions more difficult than expected in 2013, the survey showed.
Forty per cent of New Zealand businesses surveyed said a poor economic environment or increasing costs would be the reason for their business not growing next year.