Business financial pressures

Budget 2025

The economic backdrop for Budget 2025 is a challenging one. While inflation and interest rates have reduced from 2024, cost of living pressures still linger, and ongoing international trade turbulence is casting a shadow over economies all over the world. And while business leaders are feeling more positive than they were last year, financial pressures continue for many.

Our May 2025 BDO Business Wellbeing Index shows 57% of business leaders feel positive about their overall business performance – up 6% on our September 2024 survey. However, economic conditions continue to be a leading issue for business leaders, with financial pressures remaining a driver of negative wellbeing. The Government declared that Budget 2025 would be 'The Growth Budget', and while there have been measures announced designed to stimulate the economy and provide some support to key sectors, it may not address the growth concerns of New Zealand's business leaders.

Budget commentary sections:

“We’re seeing business growth increasingly feature as a top-of-mind issue for business leaders as they look to move forward from the ‘survival mode’ of the past 18-24 months. Changing market conditions, fuelled by factors such as lower interest rates and improving dairy prices, are driving an improvement in overall business performance sentiment. However, for many, achieving business growth remains challenging in the current economic environment, with global trade dynamics highly uncertain. And while conditions remain challenging, many of these problem areas are not new, and there are people and practical steps to help business leaders manage these effectively."

- Kimberley Symon, BDO Advisory Partner

Quick tips

  • Refresh your business strategy. The business landscape has changed significantly in recent years, but your strategy might not have. Sit down and examine your strategy to make sure it still aligns with the reality of today’s operating conditions. Things to consider include what your overall business vision and goals are and how you’ll get there, what your business strengths and weaknesses are, and any potential opportunities or threats. 
  • Implement your business strategy! It’s not enough to simply set a strategy and then continue as normal. It’s essential to properly implement actions from your business strategy and continually track your KPIs. Consider what is working and what needs to change as the environment around you changes. 
  • Keep a close eye on the news. Changes in the global economy could also have a significant impact on your business, with fluctuations in inflation globally having an impact of foreign exchange rates and further impacts from tariffs imposed – whether on your business or on global trading partners.
  • Revisit your financing position. With decreasing interest rates, you may find that serviceability of potential debt has changed - strengthening your position with the banks.
  • Think about the “what-ifs.” The business landscape can change rapidly, and it’s important that your business is able to adapt to meet the market. When forecasting, ensure you understand your potential financial position under a number of scenarios, and plan what you would do to mitigate risk or maximise opportunities in each.
  • Consider your governance model. It's important that business have people with the right skill sets in place to form strategy, make decisions, and provide advice. Asking independent directors to join your board or alternatively, forming an advisory board are excellent methods to add knowledge and skills to your business governance framework. 
  • Look at your financials holistically. You should be as familiar with your overall financial picture as you are with your products and services, market, and industry. Review every metric, from net profit and gross margin to expenses, cash flow, and sales. Look at how these combine to build an accurate picture of how your business is performing.

For practical business tips see our BDO Business Wellbeing Index here.

More information and help available

You can read more details on Budget 2025 at the Government Budget website here. 

To talk about how any of today’s Budget announcements will affect your business and for help with cash flow, forecasting, scenario planning, or to talk about your business, reach out to your local BDO office today.  

Key contact

Return to our Budget 2025 overview page
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