Spending rises but Cyclone Gabrielle had ‘major influence’ on Bay consumers

A Rotorua hospitality provider says the industry is struggling with low supplies and transport issues after Cyclone Gabrielle.

A Restaurant Association representative, however, says local businesses have not noticed much of a downturn.

This comes as Worldline New Zealand data shows spending in the Bay of Plenty rose in February, despite Cyclone Gabrielle’s “major influence” being evident in a drop after it hit.

Rotorua Restaurant Association president Sharon Wallace said while some businesses had been affected by the cyclone, hospitality in Rotorua had not been as hard hit as other regions.

“A lot of cafes in town haven’t noticed any downturn,” Wallace said.

Hennessy’s Irish Bar owner Reg Hennessy said his business has been busy with international tourists.

“Where we are struggling is with stock,” Hennessy said.

“And when we go back to our suppliers it’s the same story: Low staffing and transport issues everywhere.”

Hennessy said there were more visitors from Rotorua also because Hawkes’ Bay and Coromandel were “out of the equation” for travel at the moment.

Worldline, which runs New Zealand’s largest eftpos network, found spending in February was up 7.7 per cent on last February and up 17.1 per cent before Covid in February 2019.

Worldline data showed consumer spending in February 2023 in retail was $2.8 billion.

Worldline New Zealand chief sales officer Bruce Proffit said Cyclone Gabrielle had a “noticeable impact” on consumer spending.

“Data showed spending dropped sharply between Monday, February 13 and Tuesday, February 14 in Auckland, Northland, Waikato, Bay of Plenty, Gisborne, Hawke’s Bay and Taranaki,” Proffit said.

“For the same regions, spending increased sharply before the cyclone, which offset the decrease.”

Proffit said the growth was partly due to the effects of severe weather in February 2023 as well as higher tourist numbers.

“At this time last year, New Zealand was still in high-alert mode around Covid, meaning consumer spending was significantly curtailed, so it is not surprising to see a sharp rise on last year,” he said.

Worldline’s data accounts for about 70 per cent of total transaction volume across the country.

Retail New Zealand chief executive Greg Harford said Cyclone Gabrielle had big impacts on business owners.

“Retail took a real hit during the cyclone,” Harford said.

“And while we’ve seen a rebound post-cyclone the effects of that rebound have not been equally spread.”

Harford said while grocery and hardware retailers had seen an increase in demand since the cyclone, sales were still down in fashion and homeware.

Retail New Zealand chief executive Greg Harford. Photo / Supplied

Businesses in the Coromandel and Hawke’s Bay were struggling, Harford said.

“Things have been pretty tough. Some businesses are struggling to recover from the loss of even a few days of trading.”

Going into the future, Harford said Retail New Zealand was expecting businesses in the cyclone-affected areas to continue to struggle.

“There are questions about how soon people can return to work and about what’s going to happen to people’s disposable incomes.”

Harford said particularly in areas where retail benefitted from the tourism industry, such as the Coromandel, transport played a significant role in retail getting businesses back on their feet.

It comes as a report released by Stats NZ yesterday predicted economic statistics from March 2023 onwards will be affected by recent weather events.

Stats NZ general manager economic and environment insights Jason Attewell said the focus of the report was on forecasting how adverse weather has impacted the economy,

“The cyclones and flooding have affected the economy through disruption to economic activity and loss of assets,” Attewell said.

“People and communities have been affected too and our thoughts are with them.”

Attewell said the specific impacts of Cyclones Hale and Gabrielle are expected to be seen in results from the March 2023 quarter.

“Effects on data or collection will be explained alongside relevant statistical releases.”