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New Zealand Industries Set To Fly And Fall In 2019-20

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by Bao Vuong
Apr 15 2019

IBISWorld reveals New Zealand industries set to fly and fall in 2019-20

Beekeeping and Personal Welfare Services are set to soar, while Newspaper Publishing and Furniture Retailing will struggle.

With the commencement of the new financial year, IBISWorld has predicted the industries that are set to do well in 2020 and the ones that are set to struggle. The performances of these industries will reflect current trends, such as changing operating environments and shifting consumer preferences.

IBISWorld expects a variety of industries to thrive in 2020. In particular, Beekeeping is the most noteworthy of these industries, with anticipated revenue growth of over 8.0%.

“Other notable industries that are expected to perform well in the current year include Motor Vehicle Parts Retailing, Post-production Services and Other Motion Picture and Video Activities, Personal Welfare Services and Water Supply,” said IBISWorld Senior Industry Analyst, Bao Vuong.

“On the other hand, a number of industries are anticipated to perform badly in the current year, including the Newspaper Publishing, Advertising and Market Research Services, Furniture Retailing, and Crisis and Care Accommodation industries. However, the industry that will likely struggle the most throughout the current year is the Geothermal, Wind and Other Electricity Generation industry, with our research predicting a decline of over 10.0%,” added Mr Vuong.

Industries set to fly in 2020


Revenue 2018-19 ($m)

Revenue 2019-20 ($m)

Revenue growth 2019-20 (%)

Beekeeping in New Zealand




Motor Vehicle Parts Retailing in New Zealand




Post-production Services and Other Motion Picture and Video Activities in New Zealand




Personal Welfare Services in New Zealand




Water Supply in New Zealand




Currency used is the New Zealand Dollar
New Zealand financial year



The Beekeeping industry is becoming an increasingly important part of New Zealand’s agricultural sector.

“Rising health consciousness is encouraging consumers to reduce their sugar intake and purchase honey as a healthier sweetener, boosting industry demand. In addition, food manufacturers are following consumer health trends and increasingly using honey as a sweetener in food products such as bakery items and cereals, which is further boosting demand for local beekeepers,” said Mr Vuong.

In addition to rising domestic demand for honey boosting industry revenue, overseas markets are providing an avenue for strong industry expansion. The growing popularity of New Zealand honey, particularly manuka honey, in global markets is boosting industry export earnings.

“Manuka honey is in strong demand due to its perceived health benefits. Due to its popularity, manuka honey is often priced much higher than other honeys and generates strong profit margins for beekeepers,” added Mr Vuong.

Rising global demand for New Zealand manuka honey is one of the main drivers of the industry’s significant revenue growth over the past five years. Following on from this strong growth, IBISWorld expects the Beekeeping industry to expand by 8.1% in 2019-20, to $665.4 million.


Motor Vehicle Parts Retailing

According to IBISWorld, revenue for the Motor Vehicle Parts Retailing industry is forecast to rise by 7.1% in 2019-20, to $725.6 million. While the average age of the vehicle fleet is projected to fall slightly, the continued popularity of imported second-hand motor vehicles is expected to support demand for motor vehicle parts.

“The average age of the vehicle fleet in New Zealand is higher than in most developed countries, and second-hand motor vehicles often go through more wear and tear. This in turn leads to more repair and maintenance, which drives greater demand for industry products,” said Mr Vuong.

The increasing number of registered motor vehicles is also growing the pool of potential customers and vehicles needing parts and accessories. Higher disposable incomes among households is also expected to boost demand for more expensive parts and accessories, generating greater revenue for motor vehicle parts retailers.


Post-production Services and Other Motion Picture and Video Activities

IBISWorld expects the Post-production Services and Other Motion Picture and Video Activities industry to grow by 6.2% in 2019-20, to $459.8 million.

“This growth is largely attributable to strong government financial assistance for film producers in New Zealand. The country attracts blockbuster films from major Hollywood studios thanks to the Screen Production Grant, which pays international film studios up to 25c for every dollar spent in New Zealand for screen productions. In 2018-19, this grant provided $149.2 million in funding to the industry,” said Mr Vuong.

The industry received a recent boost in September 2018, when the government backed down on previous plans to rein in subsidisation for the industry. Analysis from the Ministry of Business, Innovation and Employment suggested that any cuts to subsidisation would significantly undermine the industry, given that many other nations such as Australia and Canada are willing to offer similar assistance to major Hollywood film studios. The industry is dominated by Weta Digital Limited, which has provided special effects for recent projects such as Avengers: Endgame and Game of Thrones: Season 8.

“In 2019-20, the industry is expected to surge as Weta Digital Limited ramps up development for the long-awaited Avatar sequels and Disney’s Jungle Cruise,” added Mr Vuong.

Personal Welfare Services

As the cost of living skyrockets and the housing supply shortfall continues, demand for welfare services is expected to rise, with revenue forecast to increase by 5.0% in 2019-20, according to IBISWorld.  

“Surging rent prices and household debt have fuelled accelerating rates of household stress, and have forced many New Zealanders to turn to the industry for debt counselling services and homeless welfare assistance over the past five years,” said Mr Vuong.

A steadily rising elderly population has also intensified pressure on the industry, driving greater use of aged-care assistance and other services. These trends are not expected to show any signs of slowing in the current year, contributing to the strong rise in demand and revenue for the Personal Welfare Services industry.

“However, with no promises of increased funding from the government, other sources such as philanthropic giving and fundraising activities will be all the more necessary in providing these essential services to New Zealand’s most needy,” said Mr Vuong.


Water Supply

Water supply firms are set to benefit from ongoing population growth and demand from agriculture markets in 2019-20, with industry revenue forecast to increase by 5.0% in 2019-20. 

New Zealand’s agriculture sector is the largest consumer of fresh water, accounting for approximately two-thirds of national consumption for irrigation, storage and crops.

“The strong appetite of international markets for high-quality New Zealand produce is expected to boost farmers’ output and consequently their need for water resources in the current year,” said Mr Vuong.

However, households will likely be the biggest driver of revenue for the industry. Many households are charged for daily consumption on top of an annual rate.

“The expansion of the population is expected to lift demand and revenue for water supply services in 2019-20. To quench the nation’s thirst for water, industry firms will need to invest in pipelines, water storage facilities and other capital assets to ensure supply into the future,” added Mr Vuong.


Industries set to fall in 2020


Revenue 2018-19 ($m)

Revenue 2019-20 ($m)

Revenue growth 2019-20 (%)

Geothermal, Wind and Other Electricity Generation in New Zealand




Newspaper Publishing in New Zealand




Advertising and Market Research Services in New Zealand




Furniture Retailing in New Zealand




Crisis and Care Accommodation in New Zealand




Currency used is the New Zealand Dollar
New Zealand financial year

Geothermal, Wind and Other Electricity Generation

Conditions for the Geothermal, Wind and Other Electricity Generation industry are projected to stabilise in 2019-20 after a significant spike in the previous year. IBISWorld expects industry revenue to decline by 10.5%.

In 2018-19, the wholesale price of electricity rose significantly due to lower-than-average rainfall, which reduced the water supply available to hydro-electricity generators. The reduction in hydro availability led to much higher reliance on geothermal electricity generation, as hydro-electricity generation usually accounts for close to 60% of New Zealand’s electricity supply. In addition, the output capacity for natural gas-fired generators was also curtailed due to damage to the Pohokura gas pipeline.

“As wholesale electricity prices begin to normalise in 2019-20, industry revenue is expected to decline. The decline is expected to be partly counteracted by the activation of new geothermal and wind generation assets in 2019-20, which will likely increase industry output,” said Mr Vuong.


Newspaper Publishing

The Newspaper Publishing industry is expected to continue to decline in 2019-20. Industry revenue is expected to fall by 9.5%, to $589.5 million. The industry has been under intense pressure for several years due to the rise of digital news media.

“After failing to merge in September 2018, dominant players Stuff Limited and NZME Limited are expected to engage in significant cost cutting in order to preserve profit margins. Both of these major players are expected to close down or divest underperforming newspaper assets, further contributing to the industry’s decline,” said Mr Vuong.

Some newspaper publishers are likely to implement paywalls on their online content, which may protect revenue generation. However, paywalls can also drive off consumers who can choose alternative news sources. NZME has announced intentions to implement a paywall by June 2019.


Advertising and Market Research Services

The Advertising and Market Research Services industry is expected to fall by 5.6% in 2019-20, according to IBISWorld.

“Industry revenue declines in the current year are expected to be the result of lower demand for newspapers and magazines. The continued shift to online publications will lead to further falls in readership levels, and further falls in advertising. This will negatively affect advertising agencies that develop newspaper and magazine advertisements, along with the media buying agencies that purchase space in these publications,” said Mr Vuong. 

Weak demand for television and radio advertising is also expected in the current year, further reducing industry revenue. More client businesses are expected to reduce their use of above-the-line advertising and focus more on targeted, below-the-line advertising. However, below-the-line advertising often requires fewer industry resources and can negatively affect industry revenue. Furthermore, the continued strong competition across the industry is likely to limit the ability of advertising firms to increase prices.


Furniture Retailing

IBISWorld expects revenue for the Furniture Retailing industry to decline by 3.3% in 2019-20, to $890.0 million, as the industry continues to struggle with a challenging operating environment.

Mounting internal and external competition is expected to continue threatening the viability of operators in the current year. While price and product range are likely to remain the key points of competition, operators are anticipated to increasingly seek niche markets or areas where they can offer value-added services to differentiate themselves from their competitors.

“The rising volume of low-cost furniture imported into New Zealand is also forecast to hinder the industry’s performance in the current year. The availability of low-cost furniture imports is projected to heighten industry competition,” said Mr Vuong.

Industry revenue is also likely to be suppressed by slower growth in residential building construction, which will reduce retail demand for furniture items. 


Crisis and Care Accommodation

According to IBISWorld, revenue for the Crisis and Care Accommodation industry is expected to fall by 1.3% in 2019-20. The Crisis and Care Accommodation industry forms part of New Zealand's social welfare sector. Industry operators provide services for some of the most economically vulnerable people in society, including children, the elderly and those with long-term disabilities.

“Socio-economic factors are highly influential in the industry. A low unemployment rate has been a key driver for lower industry demand, as this has reduced the total number of individuals in financial stress. Reduced consumption of alcohol per capita and a lower divorce rate have also contributed to the industry’s current decline,” said Mr Vuong.

While demand for care accommodation has risen, it has not been enough to offset weaker demand from care accommodation. Care accommodation is expected to continue growing, particularly as New Zealand’s population continues to age. Some factors that influence the industry, such as natural disasters, are also unpredictable, which could cause a sudden spike of growth in the industry.


IBISWorld Industry Reports used in this release:

Beekeeping in New Zealand

Motor Vehicle Parts Retailing in New Zealand

Post-production Services and other Motion Picture and Video Activities in New Zealand

Personal Welfare Services in New Zealand

Water Supply in New Zealand

Geothermal, Wind and Other Electricity Generation in New Zealand

Newspaper Publishing in New Zealand

Advertising and Market Research Services in New Zealand

Furniture Retailing in New Zealand

Crisis and Care Accommodation in New Zealand

For more information, to obtain industry reports, or to speak with an analyst, please contact:

Kim Do

Strategic Media Advisor – IBISWorld Pty Ltd
Tel: (03) 9906 3641 Mobile: 0422 773 995