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Gisborne tops NZ with huge jump in consumer spending

An influx of 1600 women visiting Gisborne last month and a bumper cruise ship season are being pointed to as some of the reasons behind a huge jump in consumer spending here.

Latest data from Paymark, which processes about 75 percent of all electronic transactions, shows the company processed $136.1m-worth of transactions in Gisborne between the start of January and the end of last month.

That equated to a 9 percent rise on the same quarter last year — the highest rise in New Zealand.

Activate Tairawhiti’s Lana Davy, manager of City Centre Vibrancy (formerly Heart of Gisborne) said a number of factors had contributed to an increase in debit and credit card spending in Gisborne.

“Cruise ships for one bring a visible tourist to the city, usually over a wide range of businesses from hospitality to retail, and even the odd service like a walk-in haircut.”

In addition, the $45.2m of transactions Paymark processed in the month of March rose 6.9 percent on March 2018. Only Palmerston North — up 7 percent — experienced a higher rise for the month across New Zealand.

Activate Tairawhiti economic development general manager Steve Breen said large events hosted in the region also played a part in the spending boost.

“The Tairawhiti Gisborne Spirited Women All Women’s Adventure Race and the Eastern Regional Surf Life Saving Championships brought around 2000 competitors to the region (last month), as well as support crews. This is a large event influx that we did not have last year.”

Paymark head of e-commerce, digital experience and marketing at Paymark Darren Hopper said the increase in spending could be down to a combination of higher business confidence and higher house prices.

“Gizzy is leading the way really on the value, up 9 percent. So, that’s first place in spend and also it’s pretty strong on the volume of transactions up 7.2 percent.

“What tends to happen is the value can drop while the volume can go up. That’s usually an indication that people are still spending but they are spending on lower value items and not really going for those big ticket items but that doesn’t seem to have had an impact in Gizzy.”

Reported drops in business confidence and a slow-down in the housing market nationally, usually led to a slow-down in consumer spending but Gisborne seemed to have “bucked the trend”.

“People in Gisborne are probably feeling a little bit more confident, business confidence is probably a little higher there too and that’s probably helping the region.

“Gisborne is a bit of an outlier when we look at the overall numbers in our reports because it is quite strong compared to the others. Usually, we see all the northern region relatively similar but Gisborne has had a pretty healthy jump.”

Mr Hopper said sectors experiencing growth over the quarter included “ a huge uplift” in department stores, which would also include the larger national chain merchants. Recreational goods retailing-hunting and fishing supplies also performed well, along with supermarkets and food and beverage.

On the other hand, other sectors such as electrical goods and pharmaceuticals, including chemists had under-performed.

“We believe, a lot of that is owing to international e-commerce.”

The fuel sector also experienced a slowdown in growth.

Mr Hopper said the results of the next quarter would be interesting to evaluate what was happening long-term.