Business confidence across Otago and Southland has halved since the start of the year with almost three-quarters of Dunedin businesses sceptical conditions will improve, data shows.<\/p>\n
Business South\u2019s latest quarterly survey, for Q2 2026, showed a \u2018\u2018significant softening in business confidence across the lower South Island\u2019\u2019.<\/p>\n
\u2018\u2018Across almost every measure, confidence has softened from the highs of late 2025,\u2019\u2019 the survey said.<\/p>\n
Of 363 businesses surveyed across Otago and Southland, only 32% expected the southern economy to be stronger in 12 months \u2014 down from 66% in Q1.<\/p>\n
In Dunedin City, this was only 27%.<\/p>\n
The changes to confidence were driven by the ongoing conflict in the Middle East, rising fuel costs, and persistent consumer demand pressures.<\/p>\n
Business South chief executive Mike Collins said the results reflected real conditions southern businesses were navigating at present.<\/p>\n
\u2018\u2018Confidence has softened this quarter, and the data is honest about why.<\/p>\n
\u2018\u2018The Middle East conflict has added a new layer of pressure on top of costs that were already stretched.\u2019\u2019<\/p>\n
The Craic Irish Tavern co-owner Claire Grenfell said she was not surprised by the results.<\/p>\n
She had noticed a big increase in the price they paid for gas and electricity, which were key costs in hospitality.<\/p>\n
All of their products were freighted in, so most of them now had a surcharge, and their gas price had also risen about 40% over the past year.<\/p>\n
Recent closures in the city, including Moiety and Velvet Burger, were making people nervous, Mrs Grenfell said.<\/p>\n
She was also concerned about a lack of major events to stimulate the city.<\/p>\n
\u2018\u2018With the cost of living crisis … people are very careful with their discretionary dollar.<\/p>\n
\u2018\u2018I think people are thinking about filling the car up as opposed to going out and having a big Saturday night.\u2019\u2019<\/p>\n
John Swan Engravers owner Janette Armstrong said retail had never really bounced back since the Covid-19 pandemic.<\/p>\n
\u2018\u2018Spending’s down, cost of living’s too high \u2014 especially with the cost of petrol and food \u2014 and people are just spending on what they can afford.<\/p>\n
\u2018\u2018Also, with the election coming up, people are being really safe with their money and just holding back to see what happens.\u2019\u2019<\/p>\n
The business was still doing memorial plaques and engravings as per usual, but its retail component had taken a 15%-20% hit.<\/p>\n
Engravings for cups and trophies had the same demand as they did every year, as it tended to be the same clients.<\/p>\n
Mrs Armstrong said they had not been hit as hard as other businesses.<\/p>\n
\u2018\u2018When you look down the main street at 9am on a Monday morning, you don’t see people out shopping, mate.\u2019\u2019<\/p>\n
Dunedin Sheepskin Shop staff member Danni Cai was surprised business confidence was so low in Dunedin.<\/p>\n
The George St business was pretty quiet until October through to March each year, when the cruise ships began arriving.<\/p>\n
\u2018\u2018At the moment it’s very, very quiet for the whole Dunedin businesses. People are not very confident on spending money on the extras like before.\u2019\u2019<\/p>\n
The survey said there was still a lot going well in the South.<\/p>\n
Tourism continued to deliver strong visitor numbers, the primary sector was performing well and many businesses were recording growth.<\/p>\n
\u2018\u2018Southern businesses are adapting by investing in efficiency, exploring new markets, and backing each other through a challenging period.\u2019\u2019<\/p>\n","protected":false},"excerpt":{"rendered":"Business confidence across Otago and Southland has halved since the start of the year with almost three-quarters of…\n","protected":false},"author":2,"featured_media":474502,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[138,219,111,139,69],"class_list":["post-474501","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-new-zealand","tag-newzealand","tag-nz"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/474501","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=474501"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/474501\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/474502"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=474501"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=474501"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=474501"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}