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Auckland SMEs 'disappointed' with local council

24 Nov 2015

Auckland small to medium enterprises (SMEs) are growing increasingly dissatisfied with the local council, according to the MYOB Business Monitor.

MYOB surveyed more than 300 SME operators based in Auckland, and found disatisfaction with local council support is at its highest level in more than two years, despite increased levels of revenue growth for SMEs in the Super City.

According to the survey, 40% of SMEs were dissatisfied with Auckland Council’s support for small businesses, and only 10% expressed satisfaction.

This dissatisfaction was in stark contrast to New Zealand’s two other major cities, where only 26% of Christchurch SME operators and 24% of Wellington operators were dissatisfied (16% and 9% satisfied respectively).

It was also the strongest measurement of dissatisfaction that Auckland has reported since the MYOB Business Monitor began asking the question in August 2013.

James Scollay, MYOB New Zealand general manager, says that as Auckland is the largest city it was ‘disappointing’ to see an increasing number of SMEs are not feeling supported by their local council.

"Councils rely on their local business sector to generate jobs, invest in the local economy and support industries, such as tourism, that benefit the whole community,” he says.

"When asked about their top pressures, Auckland SME operators noted attracting new customers, competitive activity, and retaining existing customers as the most significant.

"While it’s clear that reducing red tape around issues such as resource consents and local regulations that govern how businesses operate can benefit SMEs, the council could challenge themselves to go further to assist small businesses to succeed in what is a highly competitive market,” says Scollay.

"With local body elections being held next year, the Auckland business community will be more likely to support those candidates who endorse policies that encourage business growth," he says.

On a more positive note, Auckland SME business operators reported an even greater level of revenue growth over the last 12 months in the latest MYOB Business Monitor.

In fact, 37% of Super City business operators stated that in the year to August 2015 they had seen their revenue rise, only 18% saw a decline, with the remaining operators reporting static revenue (44%) or stating they didn’t know (1%).

"This percentage gap between business reporting a rise in revenue and those reporting a decline is a key indicator of the health of the SME community," says Scollay.

"At 19 points, this is the greatest delta we have seen since the Business Monitor began in 2009 and a vast improvement on Wellington and Christchurch levels,” he says.

Businesses in the capital city reported a 26% revenue rise with a 27% decline. The slowdown in the Christchurch rebuild showed its effects with 30% reporting a rise in revenue and 29% reporting a decline, compared to 51% and 11% the same time last year.

When compared with SMEs in other cities, Auckland SME operators were the most likely to be supportive of a policy to open up more crown land for development of housing.

More than half (51%) of local businesses would vote for a party that proposed this initiative, only 20% would vote against the policy, and the remaining 28% said it would not affect their vote.

In Wellington, 44% of SME operators were supportive of the policy, 19% were against, and in Christchurch 36% were for, 21% against.

"With over a third of New Zealand business being based within Auckland, it is heartening to see the strong revenue growth in the city.

“It is hoped that the rest of New Zealand will start to see this business boom filtering through as increasing Auckland house prices drive further growth in the regions," Scollay says.

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