Prime Minister Chris Hipkins has recently announced that the minimum wage in New Zealand will be raised to $22.70 starting from April 1, 2023. This represents a 7% increase from the previous rate of $21.20. It’s worth noting that the Starting-Out and Training minimum wage rates will remain at 80% of the adult minimum wage.
Even if your business doesn’t employ individuals earning minimum wage, this change can still impact your operations. Over time, wages tend to rise, and employees who missed out on a pay increase this year are likely to expect one in the future, especially if your business is doing well.
In addition to labor costs, inflation is predicted to drive up prices for everyday items. This can lead to increased running costs and higher prices for materials. Factors like rising petrol prices and supply chain challenges have already contributed to the increased cost of imported goods.
It may be time to evaluate your pricing strategy. Ideally, businesses should make small adjustments to their prices annually rather than implementing significant price hikes every few years. Incremental increases help avoid sudden price shocks for customers and keep your business competitive within the market.
If increasing prices isn’t a viable option or you need to make more substantial changes, it may be necessary to identify areas where you can reduce expenses. We can assist you in examining your business’s various aspects to identify potential areas for cost-saving measures.
Feel free to get in touch with us by giving us a call or sending us a message. We’re here to provide guidance and support to help you navigate these changes effectively.
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