myob business monitor special report...chc micro businesses (1-4 ftes) chc city based businesses...

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MYOB Business Monitor Special Report Canterbury Business Performance, Pressures & 2012 Outlook

1 November 2011 | Westpac Business Hub, Christchurch


Discussion areas

The make-up and “real motivations” of CHC businesses

MYOB Business Monitor | Key Insights – Business revenue growth in Canterbury

– Cantabrian business confidence

– Key Business Pressures

– Christchurch business voting & policy preferences

Business goals & plans for 2012 – Local & national


MYOB Business Monitor

MYOB Business Monitor |The voice of NZ business owners

Bi-annual survey 1000+ businesses, 0-200 employees Performance based: revenue & profit levels, cash flow, sales pipeline AU and NZ focus 128 Canterbury businesses surveyed (12.7% of sample)


The 3 Kiwi business owner profiles | NZ average

Lifestyle Seeker

48%

Business Builder

36%

Passionate Pursuer

17%


Cantabrian Business Owner Profiles

Lifestyle Seeker

45%

Business Builder

40%

Passionate Pursuer

14%


MYOB Business Monitor | Insight Summary

Slow, steady economic recovery. Confidence up on April 2011

— Sole trader confidence contracting

Annualised revenue growth highest levels since April 2010

Modest improvement in Q4 sales pipeline forecasts. Up 2% on Q2

Key pressures | fuel prices, pricing margins/profitability & interest rates

32% of businesses “online”

CHC business confidence in the economy almost halved in 12 months – but in line with NZ average

Significantly more revenue decreases than increases in the last year.

Significant improvement in Q4 sales pipeline vs Q4 2010. Up 10%

Key pressures | interest rates & competitive pressures, fuel prices

36% of businesses “online”

New Zealand Canterbury


How did business revenues cope during the year (Oct 2010 – Sept 2011)?


Business Revenue vs last year | Size Still more “decreases” than “increases”. Large business buoyant.

42%

30%

34%

28%

19%

29%

30%

24%

31%

31%

32%

38%

41%

31%

MEDIUM (20-199)

SMALL (5-19)

MICRO (1-4)

SOLE (0)

AU TOTAL

CHRISTCHURCH

NZ TOTAL

Increases Decreases


Business Revenue vs last year | Size Rural and very small employers performed best

15%

18%

27%

29%

31%

34%

39%

46%

47%

45%

48%

10%

44%

0%

44%

31%

42%

19%

CHC SME

CHC Suburban

CHC Startups

CHC Sole

CHC Medium *

CHC City

CHC Micro

CHC 2-5yrs

CHC Rural

Increases Decreases* Very small sample size


Business Revenue vs last year | Region Provincial NZ performing well. CHC beats WEL

31%

27%

29%

30%

19%

30%

28%

31%

41%

32%

38%

31%

Rest of NZ

Wellington

Christchurch

Auckland

AU Total

NZ Total

Increases Decreases


87%

41%

24%

28%

7%

13%

25%

0%

13%

35%

41%

57%

63%

75%

Agriculture, Forestry & Fishing

Construction & Trades

Finance & Insurance

Professional & Business Services

Manufacturing

Retail & Hospitality

Transport & Warehousing

More than usual Less than usual

CHC Business Revenue vs last year | Sector CHC Transport, Retail & Manufacturing hardest hit

NB: Small sample sizes


When do Kiwi & CHC business owners think the economy will improve?


When will the economy improve? Majority expect full recovery is more than 12 months away

3%

6%

16%

27%

19%

22%

7%

< 3 month

3-6 months

6-12 months

12-18 months

18-24 months

> 24 months

Don't know


Expectation of economic improvement in 12 mths.

Majority expect full recovery is more than 12 months away

REST OF NZ

CHRISTCHURCH

WELLINGTON

AUCKLAND

(AUSTRALIA)

NZ TOTAL

Sep 11 Apr11 Nov10 Apr10 Nov09

25% 23% 37% 49% 55% .

21% 35% 47% 54% 58%

28% 28% 39% 49% 61%

30% 19% 38% 57% 50%

.;

25% N/M 42% 39% 55%

.

22% 21% 32% 49% 50%

`


More confidence (< 12 mths)

Micro Businesses (1-4 FTEs)

CHC suburban based businesses

CHC businesses with rev between $75 - $199k

Businesses between 2-5 yrs & 10+ years old

CHC retail & hospitality sectors

Businesses banking with Westpac

Less confident (> 12 mths)

Women in business

Small businesses (5-19 FTEs)

CHC city based businesses

Agricultural & Manufacturing sectors

Construction & Transport sectors

When will the CHC economy improve?


How much work do NZ & CHC businesses have on in Q4, 2011?


Projected sales in Q4 pipeline for 2011 | Size CHC leads the way (again ).

50%

44%

35%

30%

29%

35%

33%

14%

16%

19%

23%

30%

19%

21%

MEDIUM (20-…

SMALL (5-19)

MICRO (1-4)

SOLE (0)

AU Total

CHRISTCHURCH

NZ Total



Projected sales in Q4 pipeline for 2011 | Region Wellington less buoyant.

29%

31%

32%

33%

33%

35%

21%

23%

21%

21%

21%

19%

Australia

Rest of NZ

Wellington

Auckland

New Zealand

Christchurch



Projected sales in Q4 pipeline for 2011 | Sector Smaller CHC businesses & “Online” businesses perform best

31%

31%

32%

36%

37%

37%

37%

39%

39%

41%

43%

43%

46%

15%

18%

20%

15%

18%

19%

26%

24%

17%

23%

25%

9%

25%

CHC "offline"

CHC sole trader

CHC city

CHC rural

CHC Micro

CHC suburban

CHC Retail

CHC Construction

CHC Westpac clients

CHC Manufacturing

CHC "online"

CHC MYOB clients

CHC Small



What revenues are expected this coming year (Sept 11 – Aug 12)?


Expected business revenues in 2012 | Region WEL & CHC most confident regions

32%

37%

41%

41%

46%

49%

20%

15%

11%

13%

6%

16%

Australia

Rest of NZ

Auckland

New Zealand

Christchurch

Wellington

Increases Decreases


Expected business revenues in 2012 | Size Very small CHC employers driving 2012 growth

27%

39%

41%

41%

42%

43%

51%

54%

56%

56%

60%

61%

61%

69%

71%

3%

12%

7%

5%

2%

9%

1%

12%

8%

4%

5%

15%

7%

0%

0%

CHC business women

CHC Small

CHC sole trader

CHC rural

CHC suburban

CHC "offline"

CHC "online"

CHC city

CHC business men

CHC MYOB clients

CHC Westpac clients

CHC Retail

CHC Manufacturing

CHC Micro

CHC Construction

Increases Decreases


More Growth

CHC “online” businesses

MYOB’s CHC based clients

Westpac’s CHC based clients

Construction, Manufacturing & Retail sectors

CHC micro businesses (1-4 FTEs)

CHC city based businesses

Less Growth

Women in business (v significant)

CHC small business (5-19 FTEs)

CHC sole traders

CHC suburban based businesses

CHC rural based businesses

CHC “offline” businesses

Expected business revenues in 2012


Effect of the Canterbury earthquake on business revenues


More affected

Business owners < 40 yrs (53%)

Female business owners (52%)

Larger businesses (59%)

Businesses in AKL (54%)

Retail sector ( 61%)

Manufacturers (65%)

Less affected

Businesses in provincial North Island

Rural businesses

50% of businesses expect an effect on

revenues over coming year due to earthquake


What’s putting Kiwi businesses under the most pressure at the moment?


25%

23%

35%

23%

26%

20%

24%

18%

15%

19%

15%

28%

25%

24%

22%

21%

20%

18%

17%

15%

11%

9%

Interest Rates

Competitive Activity

Fuel Prices

Cash Flow

Price Margins & Profitability

Other (than staff) business costs

Attracting new customers

Business finance / funding / overdrafts

Marketing & Customer Relationships

Exchange Rates

Timing of customer payments

NZ Average CHC

Main pressures on businesses this year In CHC: Interest rates, competition, fuel pricing & cash flow


Interest Rates – Business owners over 40 yrs

– Micro Business (1-4 FTE)

– CHC City based business

– CHC “Offline” business

– Professional Services, Transport & Retails sectors

Price Margins | Profitability – Business owners over 40 years

– Larger CHC employers (5+ FTEs)

– Manufacturing & Agriculture Sectors

Competitive Activity – All CHC based employers (v sig.)

– CHC “online” businesses

– Construction, Retail and Manufacturing sectors

Cash flow – Business owners under 40 yrs

– CHC business women

– All CHC based employers (v sig.)

– CHC “offline” businesses

– Construction, Retail, Manufacturing & Agriculture sectors

Main Pressures | Key Highlights


What are the main objectives for businesses this year?


Increase customers & revenue, 52%

Maintain customers & revenue, 29%

Minimise losses, 10%

Unsure, 10%

Main Business Objectives for 2011 Most NZ business see GROWTH as their primary objective. Up 4% since April 2011

Stronger Growth preferences

from:

– Men

– Business owners under 40

– Start-up businesses

– All employers (esp. < 19 FTEs)

– Retail, Manufacturing, Construction and Finance & Insurance sectors

– “Online” businesses


Increase customers & revenue, 51% Maintain

customers & revenue, 27%

Minimise losses, 10%

Unsure, 13%

Main Business Objectives for 2011 Most CHC businesses see GROWTH as their primary objective (But growth down 7% in 12 months, maintenance up 9% - Nov 2010)

Stronger Growth preferences

from:

– Men

– Business owners under 40

– Start-up businesses

– All employers (esp. < 19 FTEs)

– Professional services, Finance & Insurance, Construction Sectors

– CHC “Online” businesses


Specific Canterbury based Business strategies & plans for 2012


Planned CHC business initiatives for 2012 CHC business all about growth

20%

22%

27%

28%

30%

31%

32%

39%

40%

2%

6%

0%

2%

2%

2%

3%

1%

0%

Sales promotional activity

Marketing & advertisingoffline

The sale of products /services online

Offer new products &services

The sales of products /services offline

New market activity

Marketing & advertisingonline

Customer acquisitionstrategies

Customer retentionstrategies

Increase Decrease


Planned CHC business initiatives for 2012 CHC in line with NZ average

11%

16%

17%

17%

19%

21%

26%

2%

3%

1%

4%

2%

2%

1%

Full time staff

Staff coaching & Training

Part time staff

Applications for businessfinance

Staff Salaries & Wages

Working with a businessadviser

Investment in IT systems &processes

Increase Decrease


CHC Business & Political Preferences


Region Satisfied Dissatisfied

Wellington 21% 27%

Manawatu-Wanganui 13% 20%

Christchurch 15% 38%

Otago & Southland 10% 38%

Auckland 9% 43%

Bay of Plenty 6% 40%

Taranaki 13% 48%

Northland 11% 47%

Hawke’s Bay 6% 45%

Waikato 8% 48%

Local Govt Performance: Business satisfaction


0%

1%

1%

4%

5%

13%

20%

56%

Mana Party

Maori Party

NZ First Party

Green Party

ACT Party

Labour Party

Dont know at…

National Party

Political Party Preferences | CHC Businesses “Based on the party that would best support businesses like you,

which party gets your vote…”


1%

1%

1%

2%

2%

3%

7%

14%

69%

Tariana Turia

Metiria Turei

Dr Pita Sharples

Russell Norman

Hone Harawira

Don Brash

Other

Winston Peters

Phil Goff

Dont Know

John Key

Prime Minister Preferences | CHC Businesses Based on your own personal preference, which of the following

individuals would be your preferred Prime Minister in NZ…?


Initiatives & Policies important to Businesses Red tape reductions before tax cuts. Team well-being impt.

45%

47%

53%

53%

57%

61%

76%

18%

12%

9%

21%

6%

4%

3%

The creation of a single flat tax for personal tax &company tax

Mondayising public holidays that fall on aweekend

A “buy Kiwi made” policy for all central & local govt procurement where possible

The removal of GST on selected 'essential' goods& services (eg: fresh food, & doctors' visits).

More govt investment in transport infrastructurein our major cities

Increased govt funding for innovation, R&D byNZ businesses

Simplify Provisional tax processes

Vote For Vote Against


Policies least popular with Businesses Carbon & Capital Gains Taxes more unpopular than Asset Sales.

39%

41%

22%

29%

21%

10%

22%

24%

27%

38%

58%

62%

The introduction of a compulsory Kiwisaver forall NZ employees

The creation of a common currency & economiczone with Australia

More govt intervention in the value of the NZdollar

The partial sale of State Assets

The introduction of a capital gains tax

Introduction of a carbon tax

Vote For Vote Against


The proof behind “working smarter not harder”…


Early Adopter

18%

Mid Adopter

45%

Late Adopter

37%

Has Website

32%

No Website 68%

NZ Businesses are NOT early adopters of technology: CHC leads the way with 36% of businesses having websites


29%

28%

26%

28%

29%

31%

34%

32%

EARLY Adopters

MID Adopters

LATE Adopters

NZ Total

Increases Decreases

Business Revenue vs. last year Early adopters of technology generate higher revenues


CHC “Online Businesses” performed best in last 12 months.

– Revenue increased: 46% vs. 38%

CHC “Online Businesses” predict more revenue growth in 2012.

– Revenue increases: 51% vs. 43%

Q4 Sales pipeline higher for CHC “Online Businesses”.

– More work on: 43% vs. 31%

Businesses “Online” have higher revenues & are more confident.


20%

30%

40%

50%

60%

70%

80%

90%

100%

% of Businesses with a website | By Country Australia & NZ in bottom of OECD countries...


Where should business advisers focus their attention in Canterbury?


The key business pain your clients have now…

Cash flow

Pricing & profit Margins

Customer Acquisition

Interest Rates

Business financing / banking advice

Where businesses are looking for help…

Improved procurement processes

Access to an affordable business mentor

Improved bookkeeping/accounting systems

Improved banking / financing facilities

The KEY services an Adviser should provide…


What’s the #1 thing we can do to help CHC business recover & thrive…


“Make CHC the most online

business community in the

world…”

Get 20,500 businesses online...


MYOB serves 1 million businesses in Australia & New Zealand

• MYOB develops & delivers business solutions, service and support to around 150,000 Kiwi businesses 2,400+ accounting practices.

• 28,000+ businesses subscribe to our “cloud” solutions in Australia & NZ

• MYOB solutions pay over 25% of NZ’s workforce

• Around 60% of the NZ govt’s GST & PAYE revenue is facilitated by MYOB

• 2m+ tax returns are e-filed in NZ using an MYOB product each year

• MYOB is investing NZD$90m in online R&D in NZ & Australia over next 3 years


Questions?


For a copy of the slide desk SMS your email address to:

021 77 33 44 or


Additional Information:

All MYOB Business Monitor Reports can be found online:

– www.myob.co.nz | about us | industry research

For additional information, including advanced business segmentation analysis, contact:

– Samantha Goodwin

– [email protected]

mailto:[email protected]

myob business monitor special report...chc micro businesses (1-4 ftes) chc city based businesses...

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