Source: Radio New Zealand
Insurer Vero’s annual SME Insurance Index indicates more than one in five (21 percent) businesses were not confident in their own business. 123RF
Business confidence is under pressure, with nearly two-thirds of small- and medium-sized businesses experiencing a drop in revenue over the past year – with income down a quarter for a further 17 percent.
Insurer Vero’s annual SME Insurance Index indicates more than one in five (21 percent) businesses were not confident in their own business, with just 36 percent feeling confident.
Vero executive general manager Sacha Cowlrick said businesses were under pressure to cut costs, but warned against dropping insurance.
“Having adequate [insurance] cover could be the difference between folding under pressure and finding a way through.”
External concerns dominate
The survey of 550 SME business owners found most were experiencing pressures outside of their direct control, including increasing costs (88 percent) and the economic downturn (83 percent).
Political upheaval was also a concern for many. Changes to tax policy (69 percent), regulatory changes (61 percent) and political instability (61 percent) were top of the list.
“This is compounded by the current volatile global landscape, adding another layer of unpredictability to an already complex operating environment for SMEs,” Cowlrick said.
“There is no doubt that there are very real macro-pressures concerning SMEs, but it’s critical that business owners focus on the things they can control in order to give them the best chance of weathering the storm.”
Resilience tested
Nearly half (47 percent) of businesses said they never or rarely conducted formal risk analyses, with more than half (53 percent) operating without any structured risk management framework, though six in 10 businesses expected to face at least one major operational risk this year.
The survey found about a quarter (24 percent) believed their business was very resilient.
“Business resilience isn’t just about bouncing back after an event. It’s about understanding your exposures and making informed decisions before something happens,” she said, adding that an insurance broker could help businesses develop a resilience strategy.
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
