Medium-size firms are the backbone of New Zealand’s economy – and we need to be growing more of them.
Medium-size firms are the backbone of New Zealand’s economy – and we need to be growing more of them, reports KPMG New Zealand.
Released today, the KPMG Enterprise Report discusses how, although New Zealand is a great place to start a business and to do business, it seems that it is not that easy to grow a business here. Not enough of our businesses take that leap from being a small entity to growing and achieving their full potential. Medium-sized enterprises (averaging 23 employees and turnover around $5m) are contributing 34% of gross domestic product (GDP).despite making up just 6.5% of New Zealand’s businesses.
According to KPMG’s Head of Private Enterprise, Paul McPadden, this shows the demographics of our SME market needs to change.
“Research shows that our medium-sized businesses are bigger and better contributors to the New Zealand economy than small businesses. That provides us with a clear and urgent challenge – we need to take more of our small businesses and turn them into bigger and better businesses.”
The Report delivers some key insights into what’s required to grow a business. Looking through KPMG New Zealand’s Enterprise DNA framework, we have focused on the traits covering leadership and ambition and have found clear differences in the attitudes and attributes between the people leading small companies, compared with those with ambitions to grow.
While most small business owners are satisfied with achieving the proverbial “three Bs” (the boat, bach and BMW); their more entrepreneurial counterparts are focused on continual growth. In fact 60% of mid-sized businesses say the goal of their operation is growth. They spend more on R&D, and more on product development.
“Small companies that grow into medium-sized enterprises have a certain kind of leader,” says Paul McPadden.
“They have ambition and an underlying assumption that anything is possible. We’ve characterized these people are entrepreneurial leaders, as opposed to managers of a business.”
Using case studies and commentary, the Enterprise Report takes an in-depth look at the three key stages in an entrepreneur’s journey – the start-up phase, the growth phase, and the ‘letting go’ phase (where the business owner steps aside to let others lead the business).
The 60-page Report is now being distributed among New Zealand’s business community, and can be downloaded from kpmg.co.nz.
“We hope this report helps start a conversation about how we encourage our business people to have bigger aspirations for the small company they’ve created. Making that step-change would have a transformative effect on New Zealand’s economic future.”
National Managing Partner, Private Enterprise
09 367 5919
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