Bay of Plenty business leaders positive about coming year

Positive: Outlook good for small business in the Bay of Plenty, says Steven Farrant, chairman of the Tauranga Chamber 's Small Business Tauranga group. Photo/File

Bay of Plenty small businesses have had an excellent year, boosted by the strong building and construction sector, and are confident of prospects for the coming year, say local business leaders.

They were commenting on the latest ANZ quarterly survey for October-December 2016, which showed New Zealand small businesses finished the year on an upbeat note, with confidence at its highest levels in almost two years.

A net 20 per cent of respondents, up from 17 per cent in the September quarter, said they were confident about the business environment in the year ahead, according to ANZ's quarterly Business Micro Scope survey of small firms.

The composite growth measure lifted across all five regions, with Wellington leading the way followed closely by regional South Island. Auckland continues a gradual climb, while growth prospects in regional North Island and Canterbury have started to gain more momentum.

The survey consolidates survey responses and does not specifically break out figures for the Bay of Plenty. However, Steven Farrant, chairman of the Tauranga Chamber of Commerce's Small Business Tauranga group, said the strong confidence reported nationally reflected the experience of local businesses in the region.

"Anecdotally, everyone I spoke to in the course of last year pretty much reflected that same sentiment," he said.

"Construction was one of the areas that performed particularly well," added Mr Farrant, who is general manager of Keith Hay Homes Bay of Plenty. "Building consents were through the roof."

According to the ANZ survey, nationally the construction sector (up 7 points to +30per cent) led the way, followed by services (up two points to +27 per cent) and manufacturing (up five points to +24 per cent) and retail (up seven points to +14 per cent). Agriculture reversed its September slide to pick up 11 points to +1.4 per cent.

Mr Farrant said that at this stage prospects for small businesses in the coming year were positive and expected to continue in the same vein as 2016.

Tauranga chamber chief executive Stan Gregec, agreed, saying the environment was looking positive for small business which has been a key focus for the organisation in the past year.

"A lot of small business have worked hard and have started work early after the New Year or have worked through, particularly given the construction demand. Everything I'm hearing is pretty positive at the moment. It's full steam ahead and people are still pretty gung ho."

Rotorua Chamber of Commerce acting chief executive Allison Lawton said recent economic reports had confirmed the region was doing well.

"We are absolutely seeing a positive trajectory for business in Rotorua."

According to the ANZ survey, within the small business sector, micro firms' (zero to five employees) confidence rose a solid five points to +14, while intermediate firms held steady on +26. The ANZ composite measure, a key proxy for growth, lifted to +20 during the quarter. The composite measure is based on firms' activity outlook, hiring, investment and profit expectations, all which improved in the quarter.

"It was a storming finish to a good year for New Zealand's small businesses," said Andrew Webster, general manager retail and business banking.

"If the confidence plays out, 2017 will be an excellent year for small businesses with a net 34 per cent expecting a lift in activity for their business over the next 12 months."

However, while overall sentiment and growth prospects were positive, concern about finding skilled staff continued to create a potential wedge between growth prospects and actual growth, said Mr Webster.

"Competition and regulation are also seen as obstacles to businesses realising their growth potential in 2017."

Small businesses make up:
-An estimated 97 per cent of New Zealand companies
- Most of the membership of Bay of Plenty chamber groups