Research

10 October 2016

New Zealand businesses prepare for the future


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New Zealand businesses prepare for the future

Planning for the future without red tape image

Equipment Demand Index, New Zealand, October 2016

This quarter’s edition of the Equipment Demand Index not only looks at business intentions for the coming December quarter, but reviews intentions year-on-year for New Zealand showing some interesting differences on how businesses are managing their operations. Red tape has been a major concerns across the nation as businesses strive to grow but are hitting roadblocks in their expansion plans, what can be done to reduce red tape and get businesses focusing on growth and not paperwork?

Read more excerpts from the report below and download your free copy.

Preparing for Industry 4.0

Appetite for drone technology, artificial intelligence (AI), big data, product assembly and services automation was captured in the latest round of the Alleasing New Zealand Equipment Demand Index (the Index). Four in 10 New Zealand firms indicate they have not considered investing in robotic processes in the next twelve months but are open to learning more about the benefits such as efficiency improvements, lower costs and increased productivity.

A geographic picture of investment plans

Just under half of New Zealand businesses (48.5%) plan to increase their asset base in the December 2016 quarter. Broken down by location, one in two Auckland based firms display greater demand for new and replacement equipment than firms located elsewhere (52%), up 19% in the past year, and reported a cumulative 7.9% growth forecast, a rise of 25% since August 2015. Business confidence is on the rise, but how long will it last for?

Red tape holding businesses back

Previous rounds of the Index have highlighted the need for New Zealand businesses to improve cash flow and reduce working capital constraints to achieve growth aspirations. However, the negative impacts of complex and time consuming administrative processes was not well understood or quantified. When asked which administrative process has the most negative impact on their asset acquisition program, respondents overwhelmingly reported tax compliance as their primary impediment (37.4%).

Is senior debt holding businesses back?

This round of research sought to understand why, despite several consecutive quarters of positive investment conditions, New Zealand firms haven’t kicked asset investment into action. Is this a case that senior debt capacity is detrimentally impacting their ability to access equipment that would improve productivity or grow their business?

Download the report

What’s stalling businesses in acquiring new and replacement assets? Is there a way to get around red tape? Will newer technology seen in the new Industry 4.0 revolution change how New Zealand businesses operate? Find out now by downloading your free copy of the Equipment Demand Index.

NB. The research and publication of the Equipment Demand Index was conducted under Maia Financial’s previous name, Alleasing. 

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