Auckland Business Chamber CEO Michael Barnett says the current drop in business confidence is all about certainty – or the lack of it.
But he also believes central and local government could reverse that drop by staving off the negativity of recent times with better narratives.
As the 2018 Westpac Auckland Business Awards get under way , Barnett says such awards (delivered annually by the Chamber and Auckland Tourism, Events and Economic Development) have a vital role to play in business confidence; they tell the "stories" he says central and local government are not telling and which play a major part in instilling confidence in the business community.
The Chamber's recent quarterly survey of more than 800 businesses (97 per cent of them small-to-medium enterprises) showed 44 per cent believed the economy would deteriorate further, with only 15 per cent of the opinion it would improve over the next six months. Compare that to a year ago when 33 per cent said the economy would improve and only eight per cent believed it would deteriorate.
While the rising price of fuel, slow progress on housing and infrastructure and rising labour costs are all part of the problem, Barnett says a major factor is perception.
"They are out there building up their businesses and they feed off the messages from higher up," he says. "They know they are dependent on the next big project or projects for opportunities in their markets. They need to know there is a pipeline of projects on the way."
But, using the example of the Waterview Tunnel – a project that excited much interest in Auckland – Barnett says the opposite impression is often given.
"When that was finished, they packed up that giant boring machine and other capital equipment and sent it off to Australia – and that was it. Silence. Since then all they have had is the work going on in the inner city, disrupting many businesses and which will be going on for years yet. What message does that send?
"Confidence comes from certainty – and when business has the certainty of hearing from government that there is a raft of projects and developments on the way, their confidence will rise and they will begin to spend their money and take more risks.
"The stories to tell are not those happening now – it's about what is next and next after that; that's what builds certainty and then confidence."
The current government is not yet very good at storytelling, he says, using the sudden decision to stop all further oil and gas exploration as an example – an announcement as unexpected as it was problematical, revealing issues previously not thought through.
"The story that came out of that announcement wasn't about the Taranaki region or building confidence there. It was 'me first' – meaning the government wanted to be seen as the first in the world to take a step like that."
Click here to view North-West winners.
Part of the antidote to a lack of stories is the Westpac Auckland Business Awards. Held across three Auckland regions, winners of nine different categories (Excellence in Innovation, Excellence in International Trade, Excellence in Customer Service Delivery, Best Emerging Business, Excellence in Marketing, Employer of the Year, Excellence in Strategy & Planning, Excellence in Community Contribution and the People's Choice Award) are in the running for the region's supreme award. Last year's winners were Snow Planet, Southern Spars, My Food Bag and Jet Park Hotel.
Barnett says the awards enable competing companies to tell their own stories to show success in spite of the prevailing perceptions of the business climate.
"These awards – and others like them – bring young and aspiring companies together. They are entrepreneurial and want to replace the big companies out there today. They are hungry and passionate about what they do – and the awards gives them a chance not just to strut their stuff but also to be judged by others, to benchmark themselves against the best and examine what they do and how it compares to what others are doing.
"Hoping something will happen is not a strategy. Entering the awards forces you to do something, to go back and check 'why am I in business?', 'why am I doing this?' It's rewarding to those who enter - you compare, you look at why you compete."
"You create success by having good people, good ideas, great vision, solid planning and by taking calculated risks. We applaud the success these Auckland businesses have achieved. Especially businesses not only brave enough to discover how good they are through the process of entering the awards, but also in allowing others to judge them and learn from them. They should be celebrated."
From next week we profile the Supreme Award winners from each of the three regions.
Watch highlights of this week's North West region awards:
