Sun emerging after economic dark clouds
There are positive signs for the 2012 growth forecast.
Wednesday, October 19 2011 || Comment || BY Julian Smith
If you took the brave step of starting your own business in the last two years, you would be fortunate to be joining the fewer than 20% of small startups that have enjoyed revenue growth in the last year.
Although the economy is travelling at two speeds at the moment, there’s definitely enough data to support a strengthening growth forecast for 2012, according to the latest MYOB Business Monitor.
The good news is many businesses won’t have to wait even that long to see some improvement. According to the Monitor a third of local businesses have more work booked or sales in the pipeline for the final quarter of 2011.
The vital retail sector, in particular, is looking forward to hearing tills ringing this Christmas. Compared to a rather bleak forecast this time last year – when 27% expected sales would be down and just 25% up – this Christmas will see over a third of Kiwi retailers enjoy an improvement in sales; well outweighing the 18% expecting a fall.
Other sectors too are enjoying a bumper end to the year, with 42% of the manufacturing and wholesale sector; and 43% of the finance and insurance industry reporting an improved sales pipeline.
But there are still some real gaps. The construction and trades sector has been hardest hit. It has been affected by a sluggish real estate market and record lows in building consents - and 37% of business owners in the sector report a slow down in their work pipeline.
While the results for 2011 are a mixed bag for the local economy, individual businesses are particularly bullish about growth for 2012. Just over half are planning for New Year growth rather than seeking to maintain or retrench. And for many – 41% – that strategy is expected to translate into improving revenues.
Despite that positive sentiment, most business owners appear to back their companies more than the economy. Confidence in the economy improving in the next year is still low at 25% – a long way down from 49% in the April Monitor.
Clearly, the worrying signs from around the world have many Kiwis concerned. But as they have shown through the recession and recovery, business owners in New Zealand are an incredibly resilient bunch. They are prepared to invest in growth strategies for 2012 and expect that they will do better because of it. This attitude will greatly improve our nation's chances of enjoying a real return to growth.
Julian Smith (@JulianTSmith) is the general manager for MYOB in New Zealand. A frequent keynote speaker and business commentator, he blogs on key issues and trends, providing advice on how to make business life easier.
Great to read such a positive piece.
I think you're right - and certainly hope you are ...!
Posted by Glass half full at 12:16 on October 25, 2011
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Posted by personal loans at 19:09 on November 4, 2011
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