About Xero Signals
Xero Signals is an initiative that aggregates Xero data from almost 10,000 New Zealand small businesses, and uses survey data of approximately 500 nationally representative small businesses and 1300 Xero customers. It identifies small business macro-economic trends and uses them to offer insights into how small business owners can streamline their business.
The Signals insights have been designed to be shared with others, so feel free to share either a full topic or just an insight tile with anyone you think may benefit.
Who Signals is for
A national survey told us that the majority (83%)* of New Zealand small business owners want to operate more efficiently. Signals is for them and for their advisors.
Small business owners’ aspirations have often been misunderstood. It’s commonly assumed that they:
must be a start up – when actually, the average length of time in business is 10 years*
want to grow their business – but for almost 70%* of New Zealand small businesses, growth is not a key driver
In fact, most business owners want their business to run more smoothly but many don’t know where to start. They often feel isolated and lack information to help them. Only 11% have activities in place to improve efficiency*.
How it works
The data behind Xero Signals
Signals insights are drawn from three sources:
A New Zealand small business market study, based on both:
a survey of 500 nationally representative small businesses (under 50 employees), and
a qualitative study based on face-to-face conversations with 45 small businesses. This study enabled us to understand and quantify the small business owner’s aspirations, attitudes and behaviours.
A Xero customer survey, based on over 1300 Xero customers, which guided us in identifying best practice behaviours.
Xero aggregated data from close to 10,000 customers.
Data confidentiality and privacy
We take the confidentiality, privacy and security of our customer data seriously. Privacy and confidentiality is maintained across these three sources of information, and we don’t identify any particular business or person individually. Rather, we look at trends from aggregated data. Xero data in Signals is grouped using automated means, so confidentiality and privacy is maintained throughout the data extraction and analysis process.
How Xero grouped data differs from survey data
Signals insights from Xero data are:
- based on grouped, real records rather than perception or guestimates
- based on longitudinal data from the same group of 10,000 small businesses over time, so the findings represent real changes no matter how small
- more timely regular updates on relevant topics
Who the Signals insights are shared with
We want all small business to benefit from this knowledge and we are sharing it with business owners, customers, accounting partners and business mentors.
Where appropriate, we plan to also share insights with government agencies so accurate shared understanding of the needs of small business can pave the way for more efficient, time-saving interactions with key agencies like Statistics New Zealand and Inland Revenue.
Why we’re sharing Signals insights
Small businesses are the backbone of the New Zealand economy and we want them to thrive. We want to support New Zealand business owners to work on their business and achieve their goals, whatever they may be: going fishing, spending time more time with family, or competing on the world stage.
Insights from Signals will highlight effective business management strategies to help drive profitability which we hope in turn will help save business owners time and money.
We are proud of New Zealand, and want to make it a better place to live, work and play. We want to do our bit to empower small business owners to be the best they can be, with insights and knowledge that we hope will make a difference to their bottom line and their confidence.
What the future holds
We will continue to report interesting New Zealand topics on a regular basis. We’ll soon be contrasting this with small business trends in other countries as well. You can sign up at the bottom of the main Signals page to get reminders when new topics are released.
Understanding small business strivers vs strugglers
Respondents to small business market studies conducted for Xero in New Zealand, Australia and the UK, were segmented into those striving versus those that were struggling. This categorisation was based on responses to a survey that included questions on revenue growth and optimism levels.
The findings show that business owners who have a more open, positive and future-focused approach to business do better than those that do not. Striving business owners are more likely to be more ambitious in their goals and progressive in the approach to business management.
It's not the attitude that drives the outcomes, but the openness to try new things even if they don’t succeed at first that is part of the learning process. Activities that strivers are more likely to engage in that make a difference are planning for the future, engaging with advisors (and trusting their expertise/advice), and employing technology to manage their business more smoothly. Interestingly, strivers don’t work more hours, but still manage to have healthier financial outcomes.
* Xero Small and Medium Business Market Study, May 2015