Yellow NZ has released its latest report on the state of small businesses in the country, with some worrying trends emerging.

The “Small Business Nation” report shows that digital growth has stalled in many SMEs, with a large proportion still lacking any online presence.

However, many businesses expressed a desire for a website or social media presence, with 22% saying they want a website, 12% wanting a Google Business Profile, and 9% saying they want a Facebook page.

Yellow NZ's CEO, Tracey Taylor, commented on the findings: “It’s clear that kiwi businesses are facing ongoing challenges and need our support. There has been a sharp increase in SMEs identifying a lack of time as a barrier to getting online, and it's concerning to see that overall, 65% of SMEs are investing in marketing, a decline from 69% in 2021."

Tracey Taylor.

The report also highlights that businesses that invest a portion of their marketing budgets in digital are more satisfied with their business performance.

However, 48% of SMEs in 2023 say they think the NZ economy is going badly or very badly, compared to 25% in 2021.

The most commonly cited business goal was to get more customers, with 48% of SMEs prioritizing this, followed by managing existing customers at 41%.

Amongst team-based businesses with 1-49 employees, 28% reported staff shortages as a future concern, with finding the right talent to fit the role locally being the most important contributing factor at 76%.

Kelly Duncan, Chief of Brand & Partnerships at Yellow NZ, commented on the report's findings: “When the economic times get tough, we sometimes see a snap reaction as businesses jump to reduce costs, with marketing budgets often in the firing line. But customers don’t stop spending entirely, they change the way they spend."

Kelly Duncan.

Duncan continued, "When consumers adopt a more value-oriented approach, the best response is to stay seen and boost your value. By maintaining a marketing presence, businesses are in a prime position to attract or convert new customers as their competition dials back their presence. Re-evaluate your pricing and consider bundles or loyalty-based discounts and incentives, as this captures the attention of customers on the hunt for the best bang for their buck. With customers more likely to shop around, the best thing a business can do during difficult economic times is to stay seen."

The "Small Business Nation" report provides valuable insights for SMEs in New Zealand, highlighting the importance of investing in digital marketing and staying visible during tough economic times.