Weekly Digest – 4 December 2020

Hello again – welcome to the latest edition of our Weekly Digest. Read on for the latest updates and some ideas that will help us all move forward.

Small Business Employment Rebounds Past Pre-COVID Levels

The number of people employed by small businesses increased 1.4% in October compared with pre-COVID-19 levels, according to the latest data by Xero.

This showed that the economy was performing consistently, with week-on-week growth in jobs since the middle of September. As small businesses don’t have massive cash reserves, it is important for Kiwis to do their part in helping small businesses to continue to recover by shopping locally.

Business Debt Hibernation Scheme to Be Extended

Businesses left struggling with debt due to the pandemic have been given a further reprieve, as the government has extended its debt hibernation scheme until October 2021.

Originally due to expire on Christmas Eve, this scheme allows eligible businesses to put their debts on hold for up to 7 months. While the NZ economy was recovering better than expected, the impacts of the pandemic were far-reaching and some businesses need continued support.

If you need help in assessing your eligibility or would like to consider other financial assistance options, get in touch with us today.

Reserve Bank’s Funding for Lending Scheme to Start Next Week

The Reserve Bank says its Funding for Lending Programme (FLP), offering banks up to $28 billion of funding priced at the 0.25% Official Cash Rate will launch on December 7.

This will offer 3-year funding, with banks able to borrow up to 6% of their total outstanding loans to businesses and households, made up of an initial allocation of 4% and an additional incentive-based allocation of 2% based on new lending. It is designed to provide additional stimulus in response to COVID-19, with the aim of reducing banks’ funding costs (including deposit rates) and lowering borrowers’ interest rates. It will create lending capacity for banks, and potentially be used to pay down more expensive wholesale funding.

NZ Wine Exports Hit $2 Billion

New Zealand Winegrowers reported that wine exports have doubled in value over a decade, with sales from October 2019 to October 2020 totalling a record-breaking $2 billion.

Wine is New Zealand’s sixth largest export good and shipped to more than 100 countries, with the US, UK, and Australia being key growth markets.

Rebuilding Customer Loyalty Post-Pandemic

Given the exciting progress in the development of COVID-19 vaccines, it seems like we’re starting to see the light at the end of the tunnel.

However, getting your feet back on track may not be as easy as it seems. Businesses which had to shut down during the pandemic may have lost some momentum in their customer relationships. Below are ways to make customers re-engage:

Incentivise engaging with your business by offering special offers, discounts, and gift cards.
If you increased your social media and email marketing efforts at the height of the pandemic, keep that activity going and stay in touch.
Strong customer relationships are built on trust, and the best way to establish this is to stay true to your brand and put your customers first.
Know your customers’ evolving needs and adapt accordingly. Those who survived throughout the pandemic are those that have pivoted to meet their customers’ changing priorities.

If you are struggling to keep your business afloat, get in touch with us so we can work out a plan.

Weekly Digests