NZ Small Businesses Cry Out for Stability Amid Rising Costs

Small businesses in New Zealand are facing significant challenges, according to data from the Rotorua Chamber. In the last fortnight, three hospitality businesses went out of business and a contracting firm also ceased operations. The Rotorua Chamber chief executive, Melanie Short, stated that everything was fine for these businesses until it wasn't.

Short's concern about struggling local businesses was brought to the attention of Prime Minister Christopher Luxon, who initially responded in a way that was perceived as lacking empathy. He later apologized for his comments, which were also a factor in the leadership coup against him last week.

The Rotorua Chamber conducted its latest business pulse survey and found a sharp drop in business confidence over the past nine years. The affordability of doing business has also been impacted. Short emphasized that small businesses are resilient but need stability and improvement, which they hope will come soon.

New Zealand is a nation with a high percentage of small firms, with over 97% employing fewer than 20 workers. More than 600,000 enterprises collectively employ nearly 30% of the country's private workforce. In the year to March 2026, 3023 companies were placed into liquidation, exceeding last year's 15-year high and a 70% increase over three years.

While small businesses make up a significant portion of the economy, they often lack the resources and influence to effectively communicate their needs to politicians. Advocacy for Business NZ director Catherine Beard stated that, despite the challenges faced by smaller firms, there are better indicators emerging, such as improved manufacturing and performance indexes.