SME internet satisfaction drops but online benefits are increasing

Kiwi SMEs are increasingly unhappy about internet access speeds and reliability at a time when an online presence is becoming a critical factor in helping companies succeed.

MYOB's Business Monitor, which surveys more than 1000 Kiwi small and medium business owners and managers, shows satisfaction has slipped from 49% in March 2015 to just 40% in September, while levels of dissatisfaction rose from 29% to 34%.

Tim Reed, MYOB New Zealand chief executive, says technology is a key enhancer for businesses, with benefits including improved productivity and efficiency, greater ability to reach and interact with new customers, and access to real-time information to support better decision making.

However, one of the keys to business adoption of technology is good quality internet at a fair price.

"Access to the internet has become one of the essential resources for modern business – something that needs to be continually addressed at a national level," Reed says.

Businesses in the Hawkes Bay (41%) and Waikato (40%) were most unhappy with their internet access, while the Manawatu/Wanganui region had the highest level of satisfaction at 48%.

Rural businesses were mmore likely to be unhappy with the speed and reliability of their internet service, with 41% dissatisfied, the survey shows.

And while 60% of SME operators believing having an ultrafast broadband connection would enhance their business – including 17% who say the benefit would be significant – just 22% report having UFB access.

Key benefits of UFB, in the eyes of the survey respondents, include improved connections and speed (both 61%) as well as better access to data (27%), improved use of cloud computing apps and services (23%) and reduced telecommunications costs (21%).

Auckland is the most connected city, but still only has 28% of businesses using a UFB service. Bay of Plenty at 27% isn't far behind. Christchurch trails for the main cities at just 18% - a two percentage point increase from March, while the Otago Southland region – the location of Chorus' Dunedin Gigatown, has the lowest regionally at just 12%.

And while connections may be holding Kiwi SME's back, they're also concerned about online security.

Topping those concerns are fear of hackers gaining access to data (42%), losing access to data (37%), losing control of data (32%), competitors accessing data (11%) and data surveillance by foreign and local governments (10%).

Despite the concerns half of local SMEs now have an online presence – and it's paying off for them with a marked difference in the performance of those with an online presence and those without.

The survey found 40% of businesses with a website saw an increase in revenue in the past 12 months, compared to 25% without. Fifty-four percent said being online generated more enquiries and leads, 48% said their website made it easier for customers to do business with them, and 37% said they had more interaction with customers.

The data also showed that 34% felt being online allowed them to be more competitive.

"After tracking the technology adoption of New Zealand SMEs for over three years, we can quite clearly say that businesses that are online and keeping pace with technology are doing better across every performance measure," Reed says.