Beware the Ides of March

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Many of us will be familiar with the term “the ides of March” from high school English. Famously uttered by a Soothsayer (and Brutus) to Caesar in Shakespeare’s Julius Caesar, and historically the day Caesar was in fact assassinated. For the Romans, the Ides of March meant the 15th of the month and was actually the deadline date to settle your debts. For many of our small businesses, a little after the ides, more specifically the 20th of March, is a looming date when monthly bills are due. And for some a time when knots in the stomach have no qualms in reminding you of your brutal financial realities.

Economically we are on a roller coaster ride. Some parts of our economy are going gang busters, other chunks are sloth-like and in need of a defibrillator. We are very much in a K-shaped recovery. Unemployment is at 3.2%, inflation is running at 5.9% – prices are going up across the board, but wages aren’t keeping up. $100 at the supermarket doesn’t go very far these days.

At a macro-level Newmarket is delivering results unseen in our recorded history. We had our highest ever spend in December 2021 – just shy of $90m. Boxing Day almost regained its long-held crown and out-traded Black Friday. December started very quietly, mostly because hospo hadn’t regained its momentum, but true to form, the final Christmas shopping rush pushed us well over the line. The precinct ended 4.6% up on December 2020. This much needed sugar rush was a stark contrast to the financial drought most businesses experienced for large parts of 2021. So, when we see great results, it’s always important to “zoom out” and see the broader context. On one hand some have had record sales, but on the other businesses are still paying off historic COVID-related debt to suppliers, service providers, landlords, the IRD, family members and banks etc. Some family homes are teetering – with the bank having one eye on them. What we need is a sustained flow of cash into business to help recoup previous losses, to help them regain sound footing. We need confidence.

As has been well documented many New Zealanders seemed to have taken a self-imposed exile approach to avoid exposure to Omicron. January trade started well, dropped off when the Red Light setting kicked in, but picked up a little when border reopening dates were declared. It’s fascinating how strongly Wellington can influence how we feel. We need more bold confidence from our leaders. I’ve had my ups, and plenty of downs, with the government over the past few years, but in all honesty I think history will paint this COVID period favourably for New Zealand. For the most part, history only remembers scores, it doesn’t dwell on the details of the game. And yes, the game has been a grudge match. What has been disappointing though more recently, is the lack of ongoing targeted financial support from central government, and little effort to rebuild public confidence to get out and about. To simply state that “all parts of the economy can now function normally” against a backdrop of COVID modellers predicting 10’s of thousands of Omicron cases on the daily, doesn’t really create an environment where people want to go out and about to do normal things. It would be great to see a nationwide marketing promotion. You can bet your socks that if there were genuine concerns about public safety, we would be back into lockdown faster than you can say “Go home, stay home”. If you’re doubled vaxxed, boosted, follow all the COVID protocols, life should be relatively normal.

The government has helicoptered us over the worst of the COVID carnage to a place where it is a lot safer to come out, unlike the experience of many of our overseas cousins.

As always, we appreciate your ongoing support of Newmarket. Rest assured when you are shopping, out for a drink, or a bite to eat, gymming or getting your cosmetic touch ups etc, you are personally and directly helping the economy – you legend!

See you here soon,

Mark Knoff-Thomas