Closer

Words by Michelle Robinson
L.A.B L.A.B

Event promoters and New Zealand entertainers have been working hard to fill the gaps left by international acts unable to enter our country. Kiwis have been doing their best to support them with massive crowds at concerts held in Taranaki over the summer, especially Six60 (see cover), Synthony and L.A.B.

We are one of the few places in the world to be able to have large events where we can all get together, and we have been revelling in it.

Locals have also been showing Taranaki businesses some love, with many reporting record sales.

A year since we all went into lockdown, there is a quiet optimism in the water and many of us are drinking it, Michelle Robinson discovers.

Events took one of the hardest hits 

in 2020. They are the first to shut down and the last to get back up when alert levels change. 

There was a strong swell of community support for events once the nation came out of level three initially, as people were excited to carry on life as normal after being cooped up in lockdown.

Summer concerts sold out at the Bowl of Brooklands, with Six60 and LAB drawing crowds of 15,000 and 12,000 respectively.

Synthony had its largest audience at the iconic outdoor arena, with 7200 people dancing the night away. 

“It was a really great season for the Bowl, that’s credit to them,” EVANZ general manager Sally-Anne Coates says. “I think being outdoors feels safer too, it’s an incredible venue. “There’s been this sense that this level of freedom isn’t happening in the rest of the world.”

While the Entertainment Venues Association NZ is a national body, Sally-Anne is New Plymouth based and is commenting from her experiences of living locally.

Venues such as the TSB Showplace have refunded tickets for shows postponed or cancelled by lockdowns, but audience numbers nationally are still lower than usual.

“Events industry venues are safe, we live and breathe health and safety,” Sally-Anne says.

“People should consider themselves safe at events if they play by the rules, scan in and use the sanitising stations.”

Repairing broken-down coffee machines requires a unique set of skills. 

The Coffee Repair Shop has been in hot demand since starting up just after lockdown, when owner Jonno Robinson found himself redundant. 

His new role sees him look after the espresso machines which produce the lifeblood for Taranaki’s some 55 cafes.

“The whole reason for my business is helping people keep their businesses running.”

Jonno isn’t the only lockdown start-up with the ambition to keep others in business.

Mandy Gilchrist started her online marketing company We Do Social to improve her clients’ online presence in response to Covid-19.

“Clients that have had an increase in business would definitely be the ones with online stores, all of them,” Mandy says. 
“The mindset has shifted from being scared, to being innovative to work around issues that have arisen from Covid.” 

Custom Digital Marketing helped 50 businesses back on their feet through digital enablement courses. This encouraged clients to add value through online presence, regardless of whether money is changing hands, and took the fear out of lockdowns. 

“We’re seeing a lot of start-ups, a lot of people putting it all on the line during uncertain times and being prepared to give it a go. Everyone’s really excited,” co-owner Chris Rollings says.

Being your own boss also has its perks, as Chris has discovered from leaving his convenient engineering job to join partner Jenna Brown on the business.

“There’s more flexibility in my day now. 
I can stay up late and work while everyone’s asleep and mow the lawns on a Tuesday avo. It’s a brilliant work-life balance.”

Lockdown seemed like a strange time to set up a gym, but that’s what British expat Josh Cooper did. 

With a focus on training athletes and power lifters, the ones who create noise when chucking weights around a room, it was difficult to find a gym where that kind of energy would be accepted.

Josh made use of Covid relief funds to put a deposit down and create a space for the region’s burgeoning powerlifting community.

“One of our 50 members is third in New Zealand, we hold a few records, we’re putting Taranaki on the map for powerlifting. 

“I didn’t have the fanciest gear but step by step we progressed from a concrete floor with a couple of pieces of equipment.”

The isolation of lockdown was hard, so people were keen to grab memberships which put money into building the gym and the Redemption Strength and Conditioning brand.

“That’s the message with Covid, it’s about supporting people.”

Website design company Go Forward suspended clients’ website hosting fees worth hundreds of dollars, to help keep their businesses buoyant. 

It’s not youthful optimism, Taranaki businesses by and large are doing all right, BDO Taranaki principal accountant Steve Waite confirms.

There have been no closures from clients, in fact the team has more clients from business start-ups.

New Plymouth Surf School and Fondant Shed cake decorators are among local successful owner/operator businesses to have been born out of lockdown. 

Of businesses spoken to by Live, there’s a hesitancy to acknowledge they are doing well while others are struggling. By the same token, some are reluctant to show weakness and incite pity. 

In retail, Guize clothing store’s recent move to 2 Devon St East couldn’t have been timed better. The busy shopfront has seen locals and holidaymakers snapping up summer stock, owner Brett Stokell says.

“People still like to feel and touch the fabric before they buy,” Brett says.

Getting goods down the supply chain remains a challenge.  Any parents who bought Christmas presents would know of the headache of multiple searches for a particular item.

Someone recently selling their kid’s bike ($1800 brand new) after two years of use, received $1750 for it from a grateful Northlander who drove to Taranaki to retrieve it.

Consumer behaviour has changed too. There’s a focus on creating your own luxury retreat at home, with swimming and spa pools and caravans in hot demand. 

Spa pool companies sold out of stock within six months. Demand for swimming pools has tripled, with orders delayed until August. Caravans are being made to order. 

“It’s a logistical nightmare,” Pool HQ director Nathan Mumby says. “We’re trying to get the pools into any harbour we can.”

Caravan and motorhome sales shot up by half over summer, compared with the previous year, Merit RV owner Nathan Butler says.

Recreational vehicle manufacturing is an essential service in Britain, so vehicles continue to be made during lockdowns.

The housing market continues to stun economists. Home renovation companies are hiring extra staff to keep up with demand and new projects can’t start until August, Kiwi Span owners Joel and Candace Schrader confirm.

Demand for new houses has likewise doubled, according to Adams Building and Construction. “Towards the end of last year people were wanting to upgrade their bathrooms, build decks and create outdoor areas with their holiday money,” owner Matiu Adams says.

“A lot of people are coming home or moving away from Auckland because of Covid … people are also capitalising on the market and sub-dividing their sections, selling the house at the front to pay for the build out the back.

“Bell Block’s going crazy. Waitara is nuts — there are still quarter acre sections out there.”

Jobs are found by word of mouth and are juggled to suit product availability with product delays lasting two months. He adds that timber mills are focussing on producing 4×2’s because they are so heavily in demand.

David Reid Homes’ main clients used to be families onto their second or third home. Now increasingly it’s first-home buyers. 

“It costs $800k to $900k for an average second-hand home now, which might be 20 to 30 years old,” director Nathan Mumby says. “Whereas for $850,000 to $900,000 you can get a brand-new home.”

People are buying land before sites have been developed. A new subdivision of 23 lots on Tukapa Street attracted 180 enquiries in the first week of advertisement — five of which went under contract immediately. 

“Finding land is a problem. The process to get consents is long, with no commitment to timeframes,” Nathan, who is also a director of Custom Construction, says.

“It’s got to go through the Taranaki Regional Council, New Plymouth District Council and iwi, that’s before you develop any titles.”

Still those ‘second-hand homes’ continue to have their day in the sun. Houses valued between $500k and $600k are selling for $100k more, and $200k more for houses with a GV of $600k to $700k.

“People are missing out and making silly offers to secure a home,” Harcourts Team Taranaki director Graham Richardson says.

Taranaki has reached a new record median house price of $520,000 — a 23% increase from a year ago, with only one third the number of houses on the market as there were eight years ago.

“Maybe there’s not enough property available for people to move into so they’re staying where 
they are.”

From May, banks will not be able to lend more than 5 per cent of loans to investors with less than 40 per cent deposit, which is expected to slow investment demand.

BNZ’s Tony Alexander is predicting a further building boom as people look for ways around soaring property prices.

“That’s tremendously positive for our economic recovery and eventually house prices settling down with rising supply,” he says.

There’s a growing gap between those who have family hand-ups to get into homes and those who do not, BDO principal accountant Steve Waite says.

“We’re going to reap the harvest in the future in terms of social disconnection. There’ll be angry people who were denied opportunities because of their background, rather than what they can contribute to society. 

“Taranaki is not the worst in that but we’re not going to escape it.”

House prices have risen due to low interest rates, easing of the loan-to-value (LVR) ratios, and investors not getting much return from having money in the bank.

Consequently, Taranaki had a construction skills shortage before Covid hit and with planned projects such as the hospital rebuild and ongoing demand for houses, this has exacerbated, Venture Taranaki chief executive Justine Gilliland confirms.

Job security is an issue with the unfortunately timed closure of the Methanex Waitara Valley Plant and the gap between the ending of oil and gas exploration and 
the start of green energy generation.

Meanwhile it’s been business as usual for the farming sector, who carried on while the rest of the country went into lockdown. 

Apart from a few farms grappling to find skilled staff to make up the shortfall in migrant workers, dairy farms had a bumper year.

“Global dairy trade has seen milk prices go up 40 percent over the last eight fortnights, which is phenomenal,” accountant Steve Waite says.

“The world has put a premium on New Zealand products. We’re seen to be a clean, green, and trustworthy place. 
Covid has played a part in that story.”

Taranaki is “streets ahead” in terms of farm sales and job security, Livestock Agent and Auctioneer Simon Payne confirms. 

But farmers aren’t feeling appreciated, owner of Probiotic Revolution feed supplement, Chris Collier reckons. 

“Farmers are continuing to be pressured to omit greenhouse gasses and pollution of waterways.”

The pandemic has created a game of two halves — while some industries can’t believe their luck, it’s a different story for entertainment, tourism, and service sectors. 

Consumer habits have changed with people continuing to work from home and larger social gatherings still on ice.

EFTPOS data shows that while the number of transactions in 2019 was down, the amount spent per transaction was up as people bought bigger ticket items in 2020, likely tapping into their overseas travel funds they can no longer use.

Events industry sources say income dropped by more than half from the previous year and 2020 profits were slashed to nothing.

A level two may as well be a level four with large events cancelled. “It’s a major time of uncertainty,” says a source who declined to be named.

“Companies are closing their doors and some barely clinging on while subcontractors to the industry look for work in films and cafes.

“I have lost staff and have since been understaffed when the work has been back on. The shift in stress for staff has been major from no work to too much work.

“The loss of income for the year measures hundreds of thousands of dollars, which is major for a small company in a city of our size.”

Government relief packages have paid staff wages, yes, but how do you pay for cleaning, electricity, rates, GST and rising supply costs when you have lower numbers of visitors and you’re closed more?

“We’re in the middle, we’re not as bad off as tourism but we’re not booming like consumer durables and construction,” BarbershopCo CEO Adam Johanson admits.

“After lockdown people were lining up and down the block for haircuts and our barbers can’t physically get through them quickly enough,” Adam says. “It’s disruptive.”

The silver lining is an increase in franchisee enquiries. “People are more interested in being self-employed.” 

Empire Tea & Coffee owner Dawn Ehler is grateful for funding and customer support but has still cut staff hours, changed the menu and is working long days to take pressure off the books. 

A portion of Empire’s regulars are elderly, loyal customers who can sometimes be found weeding the café’s herb gardens, “go missing” in level two. 

Empire also relies heavily on foot traffic from neighbouring corporate businesses. But increasingly workers are working from home or making their own lunches to cut costs.

“It’s easy for bosses to say, we’re in level two so half of the team will be sent home to work. That affects us.”

Activity in the CBD reduces considerably during level two, confirms Annalese Sharrock from Macfarlane’s Hospitality Group. 

“We don’t mind spending extra dollars if the experience is fulfilling for us. We are inherently social beings and enjoy interactions with others on a regular basis.”

Summer trade was strong with domestic tourism boosted by successful events: the Taranaki Gardens Festival and Arts Trail, Americarna and the TSB Bowl of Brooklands summer concert series.

Taranaki hosted 52,000 guests between June and December. Summer was busier than Spring, with iSite staff struggling to find accommodation for visitors. 

“We are facing the economic repercussions of no WOMAD this year, as well as the lack of business travel,” VT chief executive Justine Gilliland cautions.

There’s little doubt the travel industry was the hardest hit by Covid.  

“As soon as international borders started closing, Lisa and I sought business advice and acted early to prepare for a worst case scenario,” remembers Nicola McLaren of World Travellers. She and business Partner Lisa Roebuck, cut their overheads by letting go of their premises after 13 years, and taking their business mobile. “It was a big decision but it made us realise that our business is all about customer relationships. We couldn’t be prouder of how our team handled the chaos that Covid created on travel plans. Looking after our team and securing alternate work options for everyone, while we are in this hiatus, was really important to us.

“In reality long haul travel is several months away, but our new business model means we will be stronger, smarter and ready to go, when the world opens up again.”

“The old adage goes,” accountant Steve Waite sums up. “Prepare for the worst and hope for the best.” ••

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