It is official, New Zealand is in a technical recession. But what does that even mean and why should you care?
Well technically, a recession means that the New Zealand economy is contracting (based on GDP data). That is, the total value of goods and services purchased by consumers and produced by businesses has reduced in successive financial quarters.
What that means in real terms is that less money is moving around the New Zealand economy and that will mean more prioritisation is made for whether money is spent on essentials or is paid back on debts owed.
Money spent by consumers flows through businesses and reduced spending is felt right through the economy as suppliers upstream feel the ripple effects.
Some indicators suggest things are very tight right now for consumers. One such indicator highlighted by Equifax is that arrears are growing in the telco and utilities sector. This sector is considered essential (think lights and internet) so growing arrears in this sector suggests the money go round is running dry.
What does this mean for you?
Well, rather than wait to see if your business is eventually affected by the incoming cash crunch, there are a few things you can do to protect your businesses cashflow right now:
Our friendly Customer Service team are available to talk through the Debt Recovery process with you.
Call us today at 0800 324 768 or fill in the form and we will get in touch as soon as possible.
