Mid-size businesses have enjoyed success trading with Australia, China, Japan, South Korea, Canada and the United States. Photo: Luis Boza / NurPhoto via AFP
Mid-size businesses are expected to help drive New Zealand's export growth amid an increasingly unpredictable outlook for global trade.
The Bigger Picture report by accounting software firm MYOB said the contribution by mid-sized businesses should not be under estimated.
"In our last three surveys of this segment, most businesses reported revenue growth on the year prior, which - given the conditions - is unarguably impressive," MYOB general manager Kim Clarke said.
"Many are already enjoying export success with markets like Australia, China, Japan, South Korea, Canada and the United States."
She said building relationships with new parties in key markets would be critical to growth in export volumes.
"Mid-sized businesses are already doing the heavy lifting to help achieve this and we saw in our polling last year that plenty more have ambitions to start exporting over the next five years, but ultimately success here relies on them to be running at full speed.
This means removing any blockers and putting the right frameworks in place to help them do so," she said.
The report indicates 60 percent saw revenue increase on this time last year, with the average value of goods or services shipped per business each year estimated at $18.1 million.
Leading sectors included manufacturing (82 percent exporting), agriculture, forestry and fishing (78 percent) and wholesale (74 percent).
Removing barriers to growth and unlocking business potential
Clarke said mid-sized businesses wanted to see policy settings changed to accelerate their business performance.
The report identified the top limiting factors as rising costs (40 percent), industry competition (33 percent) and business or industry regulation (31 percent).
Improving international trade relations through new free trade agreements and other trade deals was supported (71 percent).
Other policies or actions the business leaders surveyed believed would help over the next five years included addressing interest rates and inflation, government-led programmes to support business' digital upskilling and cyber-resilience, adjusting competition settings, reducing the company tax rate to 25 percent and government-backed loans/subsidies.
"Both tax settings and foreign trade and investment have recently been the talk of the town when it comes to policy improvements on the Government's radar to stimulate economic growth, but these need to go hand-in-hand with practical initiatives and support," she said.
"Over the course of our years working closely with mid-sized businesses, they have continually shown a propensity for innovation and creating efficiencies in their operations to improve their productivity.
"Our insights indicate that if they were armed with more capital, it's likely we'd see this confidence to invest in and embrace new technologies, increase, and generating such an outcome is critical if we want to ensure economic progress isn't limited to a short-term horizon."
Productivity gains sought
"Though there is high confidence (70 percent), New Zealand's economy will continue to improve in 2025, decision-makers in mid-sized businesses recognise that unlocking productivity gains will be key to achieving their own growth goals this year," she said.
The sector was interested in developing and investing in a skilled workforce with increased staff training (37 percent), followed by more automation (36 percent), increased capital investment (35 percent), implementing new or updating business software (33 percent) and reduced compliance requirements (33 percent).
"Continuous investment in modernising their operations and taking their teams on the journey, has played an important role in enabling the agility of mid-sized businesses so far," Clarke said.
"However, the sooner the government releases some of the shackles to growth - addressing capital, competition and regulation settings - the quicker these businesses will be able to unleash even more capability and cement their status as a true market force."
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