WELLINGTON: One in two New Zealand businesses plan to boost their capital expenditure (capex) budget this financial year, a move that is intended to drive down margins, accelerate growth and improve competitive positioning. These findings come from new research, …27 April, 2016.
One in two New Zealand businesses plan to boost their capital expenditure (capex) budget this financial year, a move that is intended to drive down margins, accelerate growth and improve competitive positioning. These findings come from new research, which also reveals that the number of businesses New Zealand businesses planning to increase their asset baseintending to increase their asset base has risen by 6.7% in the past eight months, with the smaller end of town displaying the most positive intentions regarding equipment investment.
The latest round of the Alleasing Equipment Demand Index (the Index) found that 56.6% of SMEs plan to boost their capex budget this financial year, by an average of 7.4%. This compares to 45.2% of micro businesses and just 31.5% of corporates, and it provides further evidence that the country’s small businesses are underpinning overall asset acquisition demand growth.
At a geographic level, the data reveals Auckland-based businesses are considerably more optimistic than their Wellington-based counterparts. Almost half of Auckland-based businesses (48.3%) intend to increase their asset base, up from 43.9% in September 2015, with an average forecast increase of 7.4%. In contrast, 41.9% of businesses located in Wellington expect to increase their asset base, with a lower average forecast increase of 6.0%.
According to Alleasing’s Chief Executive Officer, Daniel Blizzard, investment conditions for the new financial year are relatively buoyant, despite some uncertainty in domestic and international trading conditions.
