Kiwi manufacturers closed out 2025 with a bang, recording a double-digit surge in sales revenue as the sector pivoted from survival-mode to growth, according to new data from inventory management software provider Unleashed.
The average small-to-medium firm generated $245,758 of revenue in Q4, a significant 17.2% jump from Q3. Firms accepted a margin trade-off to capture this year-end demand, with gross profit margins easing to 36.03% from almost 40% the previous quarter.
Broadening out to the 2025 calendar year, sales remained positive, with New Zealand ending the year with a 7.7% year-on-year (YoY) increase in revenue for the average Kiwi SME manufacturer.
After a period of lean inventory management earlier in the year, Q4 signalled a decisive move toward replenishment. New Zealand firms have invested in inventory, with Stock on Hand (SOH) climbing 30% to an average of $207,198.
“What we’re seeing is a strategic pivot,” explains Jarrod Adam, Unleashed Software’s Head of Product. “In previous quarters, firms were slashing stock to protect cash. This surge in both stock levels and purchase order values - up 25% this quarter - tells us that manufacturers are now positioning themselves for a busier 2026.”
Supply chains remained efficient to support this build up, with New Zealand maintaining the shortest lead times in the ANZ region at just 16 days, facilitating rapid inventory turnover.
Electrical sector surges – and construction builds momentum
While many sectors saw growth, the Electrical & Electronic Components sector emerged as the standout performer of 2025. The sector maintained a massive +14.5% full-year growth trend, concluding Q4 with average sales of $254,752.
Evnex, a New Zealand based smart EV charger manufacturer, is seeing the local sector’s strength first hand.
“New Zealand compares favourably with other manufacturing locations. Labour costs are relatively competitive and we have a very high level of capability, especially in Christchurch where there’s a strong cluster of electronics manufacturing expertise,” says Evnex Founder & CEO, Ed Harvey.
The strongest QoQ performer in revenue was Health, Medical Supplies and Equipment with a huge lift from $198,006 in Q3 to $325,279 in Q4.
Meanwhile the Construction Manufacturing sector, often seen as a bellwether for the broader economy, also posted very strong QoQ growth. Revenue for the average manufacturer supplying the construction industry leapt from $228,443 in Q3 to $322,845 in Q4.
Food and Beverage have faced tough headwinds in recent years but Q4 offered a welcome lift to both. Revenue for the average Kiwi food manufacturer climbed from $133,586 to $181,360 between Q3 and Q4, with beverages reaching $153,719 in Q4 compared to $118,149 in Q3.
Monetary stimulus provides a tailwind
The rebound in activity coincided with a more favorable macroeconomic environment. With the Reserve Bank of New Zealand (RBNZ) bringing the OCR to 2.25% financing conditions have eased significantly compared to the start of the year.
“The RBNZ’s stimulus is clearly hitting the ground,” Adam notes. “The disconnect between slightly lower margins and higher purchasing activity suggests firms are investing in their own capacity and projecting a significant rebound in early 2026.”
Overall New Zealand outperformed its neighbours in terms of quarterly growth – Australia recorded a healthy 38.47% average profit margin, but saw a slight 1% dip in quarterly revenue.
Unleashed’s outlook for 2026
According to Unleashed, the transition into 2026 shows a move away from uncertainty-driven caution that has characterised the manufacturing sector since the post-pandemic recovery and the subsequent high-cost economy.
However, the outbreak of conflict in the Middle East complicates forecasts. Energy price increases may raise material and supply chain costs, and erode margins.
The trend towards stable and low lead times could also be affected as shipping firms respond.
Renewed pressure on energy and supply costs are likely to accelerate an existing imperative for firms to evolve beyond surviving high costs towards scaling efficient operations.
Manufacturers are now prioritising the mitigation of persistent labour shortages and increased input costs through the adoption of automation to streamline workflows.
“We are seeing a maturation in how SME manufacturers approach their growth,” says Jarrod Adam, Unleashed Software’s Head of Product.
“It’s no longer just about having enough stock to weather the next disruption, it’s about building a business that is lean by design and resilient by default.”
As always, Unleashed notes, the smallest players will be the most affected – yet able to pivot faster to any change.
