Low sales biggest problem for SMEs

Last updated 11:21 10/04/2013

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A wave of confidence is spreading to small firms across the South Island because of the Christchurch rebuild, according to ANZ Bank's Micro Scope survey.

The survey questions micro businesses which have five employees or less and small businesses with six to 20 employees around New Zealand about prospects for their firms in coming months.

Highlights of the survey were Canterbury and Wellington being the most optimistic regions with net 17 per cent of businesses surveyed positive while a net 16 per cent were positive in the South Island.

Low sales remained the greatest problem for micro and small businesses, the bank said, followed by regulation which was considered a bigger challenge than competition.

ANZ said the confidence of small businesses in Canterbury and in the South Island lifted in the March quarter from the previous quarter and it was most marked across small firms in the South Island whose business confidence rose sharply, 5 per cent, to a net 16 per cent.

However, among micro businesses confidence was unchanged nationwide.

Construction is the most upbeat sector nationally with confidence among small businesses in residential construction surging to a net 21 per cent, a 13 year high.

Small businesses were keener to invest than at any time since 2005.

Managing director of ANZ Business Banking  Fred Ohlsson said confidence in Canterbury had grown steadily for a year and was likely to keep rising.

''The boost to business prospects is now spreading to small firms across the South Island and beyond, '' he said.

Canterbury made up about half of the South Island economy and about 12 per cent of the national GDP (gross domestic product).

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- BusinessDay.co.nz

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