‘Team Of Five Million’ Urged To Dig Deep For Business Recovery

New Zealand's 'Team of Five Million' will need to dig deep and play the long game to support economic recovery as the Covid response leaves thousands of small businesses reeling, a leading business services expert says.

Bayleys national business sales director Jayson Hayde has called for a concerted national campaign with Kiwis rallying behind local firms, businesses and regions collaborating for common benefit, and the Government standing beside business with a long-term recovery strategy.

His call to action comes as a new survey reveals a grim outlook among SME owners after prolonged lockdowns in the North Island and nationwide restrictions.

The Pulse Check survey*, run by The Alternative Board in partnership with Bayleys, shows the Delta blues have hit business owners hard with an onslaught of rising input prices, inflation, interest rate hikes, staff and skill shortages and supply-chain issues.

Sixty percent of respondents reported negative business sentiment, as the lockdown and ongoing uncertainty wreak havoc with confidence. One in five rate their cashflow situation as either ‘grim’ or ‘ghastly’, with late payments increasing and one in twelve firms nearing a crunch.

Three-quarters (74%) of owners surveyed said government policy was negatively impacting their business, with a third feeling the Government was not listening and a similar number saying a lack of clarity was sapping confidence.

Hayde said as the country began to reopen, it was time to switch the national focus to supporting small and medium businesses.

“Our Team of Five Million has achieved great things with the health response, but the game is far from over. We now have to rally our strength for the next spell, which is all about recovery.

“Small businesses are the driving force of our economy but Covid has hit them incredibly hard. Many are battered, bruised and almost out on their feet. Now it’s time for all of us – business owners, consumers and Government – to pull together for the common economic good as we move towards recovery.”

For many small business owners, the challenge now was to focus on the future and make the adjustments and tough decisions to get their business on a sustainable footing, Hayde said.

The survey showed one in five owners were ready to sell, with a similar number losing hope or near closing.

“All owners in trying times should ensure they’re in a position to sell if needed. If we've learnt anything in the last 20 months, it’s that nothing is certain. Your business should be sale-ready always.

“More than ever, it’s essential to engage professionals, have a robust business plan and actively work it, confront the issues that face you and innovate and adapt – and, when making decisions today make sure you understand the potential impacts on business value should there be a sale.”

Hayde said Kiwi consumers could also play a key role, by buying Kiwi-made, supporting local, and pre-buying products and services from sectors such as events, hospitality and travel which will take time to reopen.

“Businesses are also pleading for support from the Government. Owners are crying out for clear messaging about the rules, possibilities and the road ahead. They want to know the Government is listening and will stand beside them for the long haul with an effective pathway to recovery.”

Alfredo Puche, owner of The Alternative Board New Zealand, said the Pulse Check survey showed the need for action was urgent.

“The results show we’ve reached a watershed moment. Confidence has plummeted, flipping from great in our Winter Pulse Check to grim in this Spring edition. We’ve seen frustration and dissatisfaction setting in and business owners are full of trepidation over the future of the economy.

“Supply constraints and increasing freight costs are hitting business owners in the pocket, with most intending to pass on those increased costs through price rises of their own. The road ahead seems destined for some tough economic times with inflationary pressures combining with rising interest rates, a difficult labour-supply situation and inevitable business failures following prolonged lockdowns.

“We’re really concerned about those who are feeling more isolated as they deal with ever-increasing pressures and, as the weather outside warms up, business owners are haunted by the icy spectre of inflation freezing confidence and stunting growth,” Puche said.

Gordon Stuart, owner of the The Alternative Board Auckland Central, said while business owners have taken many punches and blows from Covid, it is time to re-look internally.

“Give yourself an uppercut. Take a look in the mirror, understand your shortcomings and make adjustments to get back into a healthy routine and mindset.

“As a business owner, right now is when your leadership is most needed by those around you. Keep it simple, stay calm, be resilient, take outside advice, be confident and communicate like hell! Losing is not an option,” said Stuart.

The Alternative Board supports SMEs and their owners through advisory boards consisting of other local business owners, expert one-on-one coaching, business planning tools and business mentoring. Bayleys and the Alternative Board have entered a partnership to work alongside and support New Zealand’s SME community with real-time, up-to-date data and insights while the country navigates the new normal.

* The Alternative Board’s Spring Pulse Check surveyed 727 SME owners between 27 October and 1 November. The survey has a 90 percent confidence level and a 5 percent margin of error. The full results can be seen here.

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