General update by IBBZ Accounting on latest tax news, business growth and technology tips.
Small businesses are independently owned cooperation, partnerships or sole traders. There is a close control over operations and decisions by the owners. In NZ, small businesses play an important role in the growth of economy as they make up majority of businesses.
Although the big businesses may lead the stock market, however the small businesses are making economy moving as these are engine for growth. 97% of businesses in NZ are small businesses, employing less than 20 people and contributing 28% in GDP of NZ (New Zealand’s Support for Small Business 2018).
These small enterprises include industries like construction, accommodation & food services, primary industries, retail trade, professional, scientific & technical services, manufacturing, other services, wholesale trade and education
Many start-up and small businesses can easily compete with the large businesses. For instance, a new local clothing line will be able to offer cheaper rates in comparison to bigger brands as they don’t need to ship from overseas.
A sustainable environment helps in growing the business and bringing innovative products and services in the market. For instance, new café in a busy area can make regular meals look appealing than others.
Small businesses mainly operate in local regional areas and create meaningful jobs where employees contribute in every step for business growth and hence, build a direct relationship with the owner. Small business employment rose at an annual rate of 8-10% and outpaced the 3.1% growth in new jobs across NZ. In additional, there is a change of 2.1% in number of employees hired in small businesses from Jan 2019 to Feb 2019 (Xero Business Insight).
There is generally more flexibility in small businesses, so anyone can start it. People from different cultures, roles, skills and knowledge contribute in growing a small business. So, it becomes easier for the nation to cope up with tough times with more diversity.