-- Small businesses in New Zealand are pacing a slow recovery and building on the improvements seen in the second half of last year, with a 3.9% rise in sales in the March quarter, as mounting fuel shock risks remain uncertain, Xero said Thursday.
According to Xero Small Business Insights (XSBI) data, an uptick in jobs signals that small business owners are starting to feel a bit more confident about the sustainability of the sales recovery. However, this confidence is likely to be tested in the coming months in light of high fuel prices triggered by the Middle East conflict.
The latest consumer price index, which rose 3.1% in the March quarter, did not reflect a broad-based rise in inflation and suggests XSBI sales growth is an indicator of "genuine improvement in activity" rather than being driven by higher prices, the firm added.
Sales grew across industries, with other services and retail trade leading the gains, climbing 5.4% and 5.1% in the quarter, respectively.
The external shock from increased fuel prices and concerns regarding fuel availability comes at a time when the economy is continuing to build, and hurts small businesses directly through rising costs and reduced customer spending on non-fuel goods and services.
The firm said current fuel stocks in the fuel-import-dependent country are "sufficient" and advised small businesses to buy fuel as normal.