Confidence in local economy is up

SMEs report strong growth in Bay of Plenty, says MYOB general manager James Scollay. Photo / Supplied

Small and medium-sized businesses in the Bay of Plenty are enjoying the second-highest level of revenue growth in the country at 37 per cent, according to the latest survey of more than 1000 business owners and operators from around the country, conducted by Colmar Brunton for MYOB.

That puts the Bay of Plenty behind Canterbury - enjoying reconstruction-led growth of 47 per cent - but ahead of Auckland, on 36 per cent.

MYOB New Zealand general manager James Scollay said the latest survey showed the SME economy had reached a point of more manageable growth.

"While we've come off the highs reached through mid-2014, the level of stability we are seeing off the back of that period is encouraging," he said.

"Rather than the brakes going on, the SME economy looks to be settling into a period of sustained growth - especially when you take into account businesses' projections for growth this year, as well as the work they have on in this quarter."

Tauranga Chamber of Commerce acting chief executive Toni Palmer told the Bay of Plenty Times its latest quarterly member survey completed, last month, confirmed the growth trend.

"We would agree member confidence in the local economy is up, though we can't corroborate the same figures as the MYOB survey," she said.

"Selling prices and profitability are definitely expected to increase."

The chamber surveys look at all sectors and do not separate out SMEs.

One in three New Zealand workers was employed in a small business and SMEs made up about 97 per cent of businesses in New Zealand, according to the first Small Business Sector report, released last year by the Ministry of Business, Innovation and Employment.

The MYOB survey said that 41 per cent of Bay of Plenty SME operators expected revenue to improve this year - slightly ahead of the national SME average of 40 per cent.

That confidence was supported by current sales, with 31 per cent of Bay businesses reporting more work in the pipeline for the next three months, while just 16 per cent reported less.

The growth wasn't accompanied by a boost for employees.

Just 1 per cent of the region's businesses reported intending to increase the number of full-time employees they have working in their business this year, and only 11 per cent planned to increase wage and salary levels.

The survey said key pressures for SMEs in the Bay of Plenty region were attracting new customers (18 per cent), cash flow (17 per cent), and profitability (17 per cent).

However, those pressures weren't being felt as strongly in the Bay of Plenty as in other regions, the survey said.

Ms Palmer said growth was looking positive across the board.

"The only thing we're still struggling with is finding the right people with the right skills," she said.