Weekly Things New Zealand business and community leaders are asking how they think the economy is going and what they think are the biggest challenges.
Nick Grayston is the CEO of Warehouse groupwhich owns The Warehouse, Warehouse Stationery, Noel Leeming, Torpedo7 and TheMarket.com.
The group’s earnings were disrupted by Covid-19, and it did not release its full-year earnings forecast due to continuing uncertainty in the business environment.
In the face of inflationary pressures, The Warehouse is focusing on cutting costs of 200-300 essential items like breakfast foods, baby clothes, work clothes, bedding, blankets, heaters and kitchen utensils like toasters, and is seriously considering getting into the grocery clip. .
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How do you think the New Zealand economy is working now?
The headwinds we’re facing are significant. Our inflated cost rates, labor costs, and increased transportation costs, combined with significant delays in getting goods on time, are making it increasingly difficult to provide the critical value our customers depend on us, when they need it most.
There has been no recovery in the post-Covid period as we saw in 2021, so for many New Zealand companies like us we need to be vigilant during this period. This warning means that consumer and consumer confidence is low and affects the economic outlook.
What worries you the most right now?
Climate change. As a country, we really need to act. Fighting climate change requires all of us, and we have to move faster. Throughout The Warehouse Group, we examine our business and challenge ourselves to make smart, sustainable choices on behalf of our customers, so we know we are part of the solution. How we help make sustainable living easy and affordable for our customers is at the heart of their concerns. We don’t have all the answers, but we’re down a path that I walk personally.
What did we learn last year about New Zealand’s economy?
Not much was taught, but it reminded me of the power that comes from companies that have teams that have clear priorities but can be pivotal and flexible in how they deliver. Delivering great value, caring for our customers is at the heart of what we do and seeing 12,000 people come together and make it happen no matter what curve balls are thrown at them makes me so grateful and proud of the TWG team. Being smart but assertive was important.
Are you optimistic or pessimistic about the economy in the coming year? why?
I’m a bit of both. I’m optimistic about the influx of talent, freer connections to international markets and the maximization of our robust tourism environment.
However, I am concerned about the high levels of government spending and, despite this, the growing social injustice we are seeing. If we look at the youth, last week we saw teens raiding malls in the middle of the night and all the time, only 7% of New Zealand children are learning STEM subjects where the majority of jobs are in the future. We need to better educate and support our future workforce.
What is the biggest challenge facing New Zealand?
The culture is short-lived, which is exacerbated by the three-year political cycle. We need to focus our resources and follow a proactive strategic path. Having said that, we don’t have the luxury of doing one thing at a time, we have to be able to zig-zag as well as zag.
For The Warehouse Group, this means continuing to transform our business, delivering meaningful value to our customers, helping them live more sustainably, and ensuring business success for our Kiwi employees and shareholders.
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