Sales drive confidence to new heights
New research from MYOB revealed that confidence among New Zealand’s mid-market businesses has surged to its highest level in three years.
The poll, involving more than 500 business leaders, found that 79% expect economic conditions to improve over the next 12 months.
Strong revenue growth has bolstered this positive outlook, with 63% reporting higher revenue than last year, closely matching expectations from 2023.
However, not all businesses escaped the economic challenges, with 26% reporting flat revenue and 11% experiencing declines over the past year.
Despite some caution, 68% of leaders anticipate revenue growth in the next year, while only 23% expect it to remain steady.
Strong sales pipelines boost optimism
MYOB’s research indicates that robust sales pipelines are driving the sector’s confidence, with 83% of respondents reporting higher-than-expected work or sales scheduled for the final quarter of 2024.
“While cost pressures such as fuel and utilities remain, it’s clear that sentiment has turned a corner,” said Kim Clarke (pictured above), MYOB executive general manager. “Healthy sales pipelines and demand from new customers are driving this renewed optimism.”
A third of businesses expect over 60% of their final quarter sales to come from new customers, further fueling optimism about the future.
Investment priorities shift toward growth and innovation
MYOB’s survey showed that 56% of mid-sized businesses plan to expand, either by increasing their workforce or opening new locations. Other priorities include scaling operations to a national level (52%) and increasing revenue (45%).
Many businesses are also focusing on innovation, with 42% planning to invest between $60,000 and $80,000 in new initiatives next year. Notably, 27% intend to spend more than $100,000, targeting areas such as:
- New product development (34%)
- Engineering improvements (33%)
- Scientific research and analysis (31%)
- Digital security (27%)
- Cloud computing (23%)
Australians share similar innovation goals
Across the Tasman, Australian mid-market businesses share similar priorities, focusing on new product development (31%) and digital security (30%). However, they also highlight supply chain development (26%) and customer relationships (23%) as key areas for investment.
Building a Stable Future for Growth
Clarke emphasised the importance of a measured approach, given ongoing cost pressures.
“While leaders will maintain a cautious stance, investing in innovation and customer propositions is central to their strategy for growth,” he said.
With long-term goals in place, including ambitious five-year targets, New Zealand’s mid-market businesses appear well-positioned to thrive, MYOB found.
“By focusing on growth and resilience, this sector will continue to assert itself as a driving force in the economy,” Clarke said.
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