Hoping for the best insufficient
New Zealand small businesses are less confident about their prospects than a year ago and they remain reluctant to increase staff numbers, according to a survey.
The results of the CPA Australia Asia-Pacific Small Business Survey 2012 show that while New Zealand small business confidence beat Hong Kong's and Australia's, it was low compared with Indonesia, Malaysia and Singapore.
CPA Australia country manager for New Zealand David Jenkin said New Zealand's comparatively low business confidence was not surprising.
"Over the past year only 10 per cent of New Zealand small businesses increased employee numbers, and only 13 per cent say they will hire in 2013 - the lowest in the region."
Of the 258 Kiwi business owners or senior managers surveyed, only 12 per cent thought their firm would grow strongly in the next year, down from 16 per cent a year ago.
About 52 per cent - the same as 2011 - predicted their business would grow a little. Growth and employment expectations were highest among younger businesses and younger respondents.
Kiwi businesses predominantly had one to four employees and were run by people over the age of 50 who might be happy to not grow their business, the report said. Of the businesses that did borrow in 2012, most did it to survive rather than grow.
"Some Australian and New Zealand businesses are effectively hoping for the best rather than confronting their problems," the report said.
The two countries remain the most likely to mix personal and credit card use, which is not good business practice.
In terms of business management, the percentage of New Zealand businesses following up on late customer payments fell from 47 per cent in 2011 to 43 per cent in 2012. Only 27 per cent of small business received advice from an accountant in 2012, down from 38 per cent in 2011.
Policymakers should be concerned that it looks likely more Kiwi businesses will not do any business management activities in 2013, said the report.
Jenkins said policymakers must consider responsible economic management to build confidence in hiring new staff, providing reasonable access to finance to help fuel growth, and making it as easy as possible to set up and run a small business.