SMEs rate safe environment, education, lifestyle top of list
BUSINESSDESK: Small- and medium-sized business owners rank New Zealand's safe economic environment, lifestyle and good education system as key factors when deciding to set up a business here rather than overseas.
MYOB's Business Monitor survey of 1000 SMEs found 83% agreed safety was a key advantage to doing business here, followed by lifestyle on 82%. A good, stable education system elicited the third most positive result on 77%.
New Zealand's high dollar offered little advantage, ranking last on 32%. Some 36% saw benefit in our relatively low wages.
"This survey shows that New Zealand, by virtue of its relaxed culture, amazing lifestyle, and safe and stable business environment, enjoys some impressive advantages when it comes to running a business," general manager Julian Smith says.
"Unfortunately, when we look at New Zealand's economic performance, particularly in comparison with our trading partners, many of these intangible factors aren't measured.
"They do have an impact on New Zealand's prosperity. They make us a safe place to invest, a country with a recognised international brand and a culture that respects education and celebrates innovation," he says.
New Zealand teenagers already face lower wages than the rest of the workforce for their first six months after the government cut wages by 20% last week. The youth wage rate will be 80% of the minimum wage, equating to $10.80 an hour, or $432 before tax, for a 40-hour week from April next year.
"Clearly, business owners are making some trade-offs to work here," Mr Smith says. "They might enjoy the lifestyle and the ability to be close to friends and family, but the costs of competing in export markets and the continual struggle to attract staff who can get higher wages offshore make it harder to run a business in New Zealand."
SMEs ranked New Zealand's positive international brand and reputation as an advantage on 65%. Our culture of innovation was seen as an asset for exporters on 81%.
Born from the late 1970s to early 2000s, member of Generation Y were more likely to consider New Zealand's clean, green environment a major advantage on 81%. Generation X, born from the early 1960s and late 1980s, was on 65% and the baby boomers, born from 1946 and 1964, on 63%.
Baby boomers were far more likely to consider safety a key advantage on 86% over Gen X on 75% and Gen Y on 76%.
Younger business owners were more likely to be frustrated by regulations and red tape, with just 37% saying New Zealand's levels of bureaucracy were an advantage, compared to 54% of baby boomers and 52% of Gen X.
"With more and more young New Zealanders owning their own businesses, these numbers show that new values and approaches are entering the market," Mr Smith says.
"This will be important to understand, going forward in ensuring that New Zealand continues to be seen as an attractive and exciting place to do business."