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Speaker 1: Got some sober reading for the services sector. New B

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Speaker 1: and Z Business New Zealand data shows the services index

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Speaker 1: has slipped to forty six point nine. That's for November.

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Speaker 1: Anything below fifty means it's contracting. This is at its

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Speaker 1: worst level in six months. And Chris Small is ABC

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Speaker 1: Business our CEO and with us morning, Chris Well are

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Speaker 1: here there, you go, very well, this is a bit

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Speaker 1: of a surprise. It is a surprise to you.

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Speaker 2: Yeah, it really is a surprise. I thought that you know,

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Speaker 2: the worst, the worst of it been seen in winter

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Speaker 2: and order new data that we've seen suggested that winter

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Speaker 2: was our low point and then this sort of just

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Speaker 2: banged us yesterday all the day before. I think it

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Speaker 2: was so slightly surprising. But there are I think one

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Speaker 2: thing that's not covered here is the regional landscape in

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Speaker 2: New Zealand, and I think if you looked at the

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Speaker 2: South Island numbers in isolation, you'd probably see they're going

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Speaker 2: quite well. And then if you look at Auckland and Wellington,

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Speaker 2: which sort of other service hubs, they aren't going so well.

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Speaker 2: And obviously the South Island's driven by that. You know,

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Speaker 2: it's the primary negre sector, which is which is really

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Speaker 2: flying and helping that part of New Zealand.

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Speaker 1: So the PSI for a comedy cafes and restaurants and

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Speaker 1: looks if you look at it, okay at fifty eight

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Speaker 1: point eight, but actually that's still below the average of

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Speaker 1: sixty one point out. Now, what do you put that

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Speaker 1: down to. Is that simply we don't have the discretionary

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Speaker 1: cash we used to have.

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Speaker 2: Look, that's certainly what it's suggesting. But you know, we've

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Speaker 2: got a number of clients in that sector, and a

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Speaker 2: number of them are actually reporting really strong, really strong

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Speaker 2: run into Christmases. So I think in that sector in particular,

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Speaker 2: and you probably not yourself together when you're walking down pints, right,

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Speaker 2: there's there's some operators who are really strong and going well,

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Speaker 2: and then there's some that are answer there's real winners

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Speaker 2: and losers in that sector. Probably not too many in

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Speaker 2: the middle. So there's certainly many operators are going really well,

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Speaker 2: but if you're not producing something that customers want, you

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Speaker 2: really are struggling. Soeraps more of a winners and losers

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Speaker 2: rather than a consistent everyone's down. Yeah.

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Speaker 1: Now, now the retail number strongest in eight years down

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Speaker 1: to Black Friday.

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Speaker 2: Look a little bit of that, but also think those

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Speaker 2: lower interest rates are starting to kick in. And I

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Speaker 2: think when you think about your own spending, as soon

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Speaker 2: as you start seeing a little bit of extra money

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Speaker 2: in your bank account each week, you're probably going to

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Speaker 2: hit the shops first, and then you might hit your

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Speaker 2: services second. I think that's a bit of a leading

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Speaker 2: indicator that actually, you know what, we have hit the

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Speaker 2: bottom and things are slowly turned around, and services is

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Speaker 2: just going to be the lagging factor.

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Speaker 1: I think does I mean some people have looked at

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Speaker 1: these numbers I've seen already and they've gone, jees, I

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Speaker 1: don't know what this is for the outlook for economic

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Speaker 1: recovery next year? Are you doing that as well?

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Speaker 2: Look when you look at there's one number that stands

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Speaker 2: out there. So the strongest number within that report was

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Speaker 2: the new order number. So that's the most forward looking

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Speaker 2: indicator you've got, and that's the heart. It's at forty

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Speaker 2: nine percent, so it's still it's only just below fifty, which,

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Speaker 2: as you rightly said, is the sort of midpoint and

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Speaker 2: anything above that expansion. So I think with all our

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Speaker 2: customs that we talk to, whether it be childcare, gyms, hospitality,

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Speaker 2: they're all they're all thinking that they've hit the worst

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Speaker 2: of it and things are starting to be on the

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Speaker 2: mpre of in twenty twenty six is going to be

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Speaker 2: a far better year. So I think if you really

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Speaker 2: read them between the numbers, most forward looking indicator is

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Speaker 2: the strongest and regional wise used to be no walk

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Speaker 2: from them, warning from the struggling, but they will come

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Speaker 2: back and they'll follow the lead from out from the south,

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Speaker 2: fall into it, sort of benefiting from the primary and

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Speaker 2: egg receptors the way we look at it.

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Speaker 1: Oh, that's fantastic news, Chris. You look after yourself. It's

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Speaker 1: always good to talk to you. Chris Small, ABC Business

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Speaker 1: Sales CEO. For more from the Mic Asking Breakfast, listen

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Speaker 1: live to news talks that'd be from six am weekdays,

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Speaker 1: or follow the podcast on iHeartRadio