Business Trends New Zealand 2015
“For starting a business, you need to find something to hold on to, something to motivate you, something to inspire you.”
Conducting business in New Zealand, an island country, is a smart choice. World Bank ranked New Zealand as the easiest place in the world to start a business. The country stands at number three, after Singapore and Hong Kong, for ease of doing business. It is a modern country and has a developed market economy with an estimated gross domestic product at purchasing power parity per capita of roughly NZ$ 47,784. According to a survey conducted by World Bank in 2012, a mew start up or business can be started in just three days, in New Zealand. Various types of business forms prevail in the country. Among all, the popular business structures in New Zealand are:
- Sole trader – almost 90 percent of New Zealand’s businesses start as sole traders and then progress to as company structure as the business grows. Many other businesses try to form companies right from the start to take the advantage of the protection and other benefits offered by the company structure in various ways.
- Partnership – since a major part of New Zealand is under agriculture industry, the partnership has become common among such professional people and in the farming industry.
- Limited liability company- it is a very simple process to start up a limited liability company in New Zealand. One has to simply register a company online through the company office with a small fee.
- Publically listed companies – a dual market system is operated by New Zealand stock exchange. It takes into account the issues of more than 200 listed companies. It is like an alternative market for small to medium-sized, fast-growing corporates seeking a safe and efficient alternative capital raising facility.
New Zealand is a market economy and has extensive trade relations with Australia, the European Union, the United States, China, South Korea and Japan. The economy has closer economic relations with Australia and is aligned with the Australian economy. The service sectors account for almost 63 percent of the GDP activity in the economy. Aluminum production, food processing, metal fabrication, wood and paper production are some large scale manufacturing industries. Other service industries such as mining, electricity and waste services accounts for 16.5 percent of GDP. The dominance in exports is taken over by the primary sector accounting for 6.5 percent of GDP.
New Zealand has high foreign investments as compared to other countries and has an excellent reputation as a country to do business with. In comparison with other countries, New Zealand has:
- 2nd corruption perception index
- 5th index of economic freedom
- 6th HDI (human development index)
- 10th better life index
- 21st highest GDP per capita in the world
Forbes has ranked New Zealand as one of the most suitable countries for doing business. New Zealand is a place for grabbing untapped business opportunities with suitable government policies which are very friendly to investors. Corruption and crime rates are usually low which means there is no better place to conduct business than New Zealand. Technological trends are not new to the economy rather they have been around for years. The waves these technologies will create the upcoming years are:
1. Social websites and shopping
The birth of E-commerce has given brands an opportunity to use social media to market their products, talk to customers, and even make merchandising decisions. Technological advancements allow the merchants to move one step forward and launch better shopping functionalities in the social realm ( Facebook’s and Twitter’s “buy” buttons and Curalate’s like2buy platform for Instagram). Businesses like Nordstrom and Target have already started participating in the trend. The idea of social shopping has helped its users to enjoy a more seamless shopping experience. Moreover, the pattern of moving from one channel to the next will be eliminated and purchases will be completed much faster.
2. Making way for IT and marketing
The increase in demand for digital marketing professionals across the board has converged way for IT and marketing. The division of the industry into specific skills areas such as content, SEO/SEM, analytics and social media is paving the way for more and more employment. The improvement in the digital marketing is transforming organizational structures and narrowing the gap between IT and marketing teams. With the development in this trend, chief marketing officers with the management skills, operating experience, strategic mindset and vision will emerge to lead the business.
3. Travel and tourism
With a focus on high-value visitors, New Zealand’s tourism activity has a primary objective of growing value. New Zealand is considered to be a destination where one can explore and discover unique places and experiences. The target group of visitors are the young adventurers aged 18-30, independent professionals aged 30-55, and silver surfers aged 55 plus. The country has also built contracts with Australia and is trying to improve its online training of wholesale and reservation trade partners.
It is also important to note that international visitor arrivals hit a high record in 2014, with 2.7 million visitors spending time in the country. New Zealand’s common visitors include people from Australia, China and from many other Asian countries.
4. Restaurants and cafes
This sector experienced encouraging growth as rebounding consumers and business confidence played a major part in the significant increase of the sector’s annual growth rate over the previous years. A recent report portrays a complete picture of the growing sector:
- An increase in the nationwide sales by more than 6 percent to $7.6 billion.
- Sales of cafes and restaurants experienced strong growth, up by nearly 10 percent.
- In terms of revenue generation, the outlets outstripped the national average growth rate of 6.3 percent.
- Development of more outlets is projected to increase by 251 to 14991 in the upcoming years.
- A rise in employment by 2300 to 107000 in the upcoming years.
5. Consumer good trends
Today’s consumers are more knowledgeable about food and drinks than ever before. People show concern about what is on their plates, where it comes from and how it is prepared. They are also interested in gaining a suitable knowledge about advanced consumer goods. Consumers use goods that are not readily available in the market, yet they want to create market quality goods in their own houses. Apart from goods, people show concern about the services offered to them. They are becoming more and more particular about services offered in restaurants, shopping malls and various other business places. Businesses are working upon such things to provide their customers with the better quality of good and appreciating services. Many institutions have been set up in this regard. Employees are trained to how to deal with the customers. Manufacturing units are inspected about the quality of goods they manufacture and so on.
6. Consumer technology trends
Wearables or wearable computing is becoming a new trend in the country and is quickly moving from niche to broader use, led by growing health and fitness markets. People are becoming particular about the avalanche of smart watches and wristbands, intelligent glasses, e-health patches and other similar devices. These wearables are sold globally and the estimated total number of wearables shipped hit 8.3 million and is predicted to hit 64 million units in 2017. Along with wearables, smart TVs have also become a part of consumer trend. The global smart TV shipment is expected to reach 123 million in the upcoming year.
New Zealand works on free market principles and has gone from being one of the most regulated in the 0ECD to one of the least regulated. Along with an excellent agricultural sector, the advanced technology provides the ideal environment for pastoral, forestry and horticulture activities. Agricultural goods are exported in large quantities and account for around half of all good exports, and New Zealand is also one of the top five dairy exporters in the world. The country’s global tie-ups, especially with Australia, make it a profitable destination for doing business. New Zealand’s stock markets have prospered recently and rose almost 25 percent in 2012 outpacing Wall street and Australia.
The year 2003 proved to be a prosperous one for New Zealand as the economy expanded by an average of 3.5 percent as private consumption and residential investment grew strongly. New Zealand has emerged to be a favorite destination for investors for doing businesses. Various trends have paved way for new businesses, be it a sole trader, partnership or a company business.