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NZ SME manufacturers primed for a bounceback, says report

The downward economic trend for the NZ SME manufacturing industry has stabilised, with key signals pointing to a recovery, according to new data from inventory management software company, Unleashed. The quarterly Unleashed Manufacturing Report showed purchasing activity by New Zealand manufacturers rose in Q3 for the first time since the end of 2022, indicating future growth for Kiwi producers. The 6.2% average rise in purchase orders over the past three months, combined with stabilising sales revenue, comes after a sustained period of decline for the wider sector. Unleashed Head of Product Jarrod Adam said New Zealand manufacturers had been waiting for a break in the economic clouds, and these positive metrics could be the start of further good news. “This is the first time we have seen purchase orders rise in over a year and a half, which points to the difficult situation that many local manufacturers have been in of late. The news will bring welcome relief to many businesses, and may be the sign that the storm is over and some brighter days are ahead for NZ Inc,” Adam said. Unleashed’s report analyses business performance across 12 manufacturing sub-sectors in Australia, NZ, and the UK – drawing on the live sales, inventory, purchasing, lead time and profit margin data managed within their cloud software platform – to assess the overall health of the sector. Purchase orders up 6.2% (June 31 2024 to September 31 2024) For the manufacturing sector, which generally has long sales cycles, tracking purchase orders is a useful predictor of future revenue. Purchase order numbers have been dropping consistently over the past three years (with exception of Q4 2022). While still down 26% on the same quarter in 2021, at an average of 82 orders, the change marks an important turning point for local producers. In a similar vein […]

Navigating a Reputation Crisis

Business leaders rarely expect a reputation crisis, but these situations do arise, often attracting media scrutiny. Facing media inquiries in challenging times can be daunting, particularly when potential brand damage is involved. Director of Auckland public relations agency Impact PR Mark Devlin discusses how manufacturers can navigate a crisis in front of the media. For many businesses, lacking a crisis response plan means CEOs and senior leaders might struggle to manage a sudden call from a journalist or an impromptu press conference. Some executives opt for a “no comment” response, which can imply a lack of transparency or unwillingness to address issues directly. In most cases, declining to comment isn’t the best strategy. Although there may be rare instances where silence is justifiable, generally, it’s more effective to respond with honesty, offering information where possible. The key to successfully managing media during a crisis is having a pre-existing plan, pinpointing potential crisis scenarios, and identifying who will address reporters’ questions. This spokesperson must be well-prepared and trained in media engagement to deliver a clear, impactful message. Preparation is the best defence against negative press. Most can recall a situation where a CEO’s or spokesperson’s mishandled responses amplified a crisis, but there are also cases where skilled media handling turned potential setbacks into reputation-building moments. The company’s most senior leaders, especially the CEO, should ideally be the face of media responses during a crisis, signalling that the situation is taken seriously. The CEO’s presence shows the company values the matter and is ready to act, as they are seen as the ultimate authority who can credibly commit to solutions or offer a genuine apology. Whoever is chosen to interact with the media must understand how to positively influence both the interviewer and the broader audience. An interview is an opportunity to […]

Manufacturing, Technology and Innovation Success at the Hutt Valley Business Excellence Awards 2024

Manufacturing, technology and Innovation were again at the centre of the Hutt Valley Chamber of Commerce’s annual business excellence awards. The gala dinner and awards ceremony for the 2degrees Wellington Regional Business Excellence Awards were held in the Hutt Valley on Friday 15th November and manufacturing, technology and innovation organisations were among the finalists and winners. ‘Our local manufacturing, technology and innovation organisations make up so much of our business sector and do so much for our community’ said Patrick McKibbin, CEO of the Hutt Valley Chamber of Commerce. ‘We had so much talent at the Gala Dinner tonight, and it was so good to see so many of our great businesses being recognised.’ The manufacturing, technology and innovation winners and finalists included: Excellence in Sustainable and Environmental Practices sponsored by CentrePort Ltd: Winner Pact Group Holdings Ltd 🌿- a leading Hut Valley manufacturer leading the recycle revolution and creating sustainable packaging solutions. Eli Barrington, Operations Manager from Pact Group receiving his award from Anthony Delaney from CentrePort. Best Small Business sponsored by Gallagher: Winner Prologic Skin Care 🛍️- a Wellington based manufacturing a unique corneotherapeutic range of skin care products and supplying to markets in New Zealand, Australia, and the UK. Excellence in Health, Safety, and Wellbeing Innovation sponsored by ACC New Zealand: Winner – MJH Engineering Ltd 🤲 – one of New Zealand’s leading structural steel fabricators and based in the Hutt valley Finalist – Whakatiki Engineering (1984) Ltd – an Upper Hutt Based structural steel fabrication company. Finalist – Sharesies – innovating to help people invest, save, insure and grow their future wealth with Kiwisaver. Excellence in Manufacturing sponsored by Woburn International: Winner – Whakatiki Engineering (1984) Ltd 🏭- an Upper Hutt Based structural steel fabrication company Finalist – Contemporary Korowai Designs – from Wainuiomata they hand […]

How manufacturers can prepare for the ESPR

www.thinkstep-anz.com Image by Dinh Khoi Nguyen from Pixabay. As global sustainability regulations evolve, New Zealand manufacturers must stay ahead of the curve to maintain their competitive edge, especially with upcoming policies like the European Union’s Ecodesign for Sustainable Products Regulation (ESPR). But what is the ESPR, and how can manufacturers in New Zealand prepare for it? What is the ESPR? The ESPR is a new EU policy aimed at making products more sustainable and circular throughout their lifecycle, supporting the EU’s 2050 climate goals. The ESPR applies to products sold within the EU, setting specific sustainability requirements for design, use and disposal. It applies to most products sold in the EU, except for some like food and medicines. Non-compliant products may face fines or bans. Although it took effect in July 2024, the detailed rules will be developed over the next year. The regulation aims to make products more durable, reusable, repairable, and recyclable, while banning the destruction of unsold goods like electronics and textiles. A digital product passport will also be required, giving consumers direct access to sustainability data and exposing brands to greenwashing claims under the Green Claims Directive. Why should New Zealand manufacturers pay attention to ESPR? For manufacturers exporting to the EU or intend to: Failure to prepare for the regulations could result in loss of market access, fines, or even prosecution. Your products will face stricter comparisons on sustainability and circularity, which could impact your market share positively or negatively. Even if your business doesn’t currently export to the EU, the trends set by the ESPR are likely to influence regulations and purchasing decisions in other markets. As supply chains globalise, multinational corporations may enforce ESPR-style standards on all their suppliers, no matter where they are located. With more sustainability and […]

Tech isn’t the Hero, it’s the plucky sidekick

Frank Phillips, Director, Fulcrum NZ The Tale of Two Manufacturers Imagine two companies, both manufacturers here in New Zealand, standing on the brink of change. Company A embraced digital technology not just as a solution but as a stepping stone to reshape their operations. They invested in data analytics, IoT, and automation, with a clear vision to enhance their product offerings. They didn’t see tech as a shiny new toy; they saw it as a tool to make existing processes more efficient, reliable, and insightful. As a result, they grew sustainably, adapting each new piece of tech to complement their strategy. Company B, on the other hand, rushed into the world of digital with stars in their eyes and a sense of FOMO. They adopted everything from machine learning to augmented reality but hadn’t mapped out where these would fit into their overarching business vision. Within two years, they were drowning in tech debt and bloated processes, with digital “solutions” that solved nothing but looked impressive in investor presentations. The difference? Company A used tech as a supportive actor, not the main character. Company B? They gave tech top billing without considering how it fit into the wider story. The lesson here? Industry 4.0 should be the sidekick in your journey—not the destination. Tech as a Strategy or a Sidekick? It’s tempting to make Industry 4.0 your main strategy—after all, the tech is exciting! But if you’re all about tech and not about your business goals, you might end up with a whole lot of digital flash and little substance. In manufacturing, the real heroes are efficiency, quality, and customer satisfaction. Industry 4.0 tech—be it sensors, AI, robotics, or data analytics—is just the toolkit to help us get there. For New Zealand manufacturers, it’s about knowing that “the “cool factor” […]

Finding Your True Competitive Edge: A Guide for Manufacturers

Adam Sharman, CEO LMAC Group, APAC Throughout 2024 we have heard the mantra ‘survive to ‘25’ across a number of businesses and sub-sectors of our industry. In challenging economic times, manufacturing businesses face unique pressures from all directions – supply chain disruptions, decreased demand, and tightening credit markets. However, history shows that companies taking decisive action during downturns often emerge stronger when the economy recovers. In these times, organisation must be clear on what it is that sets them apart, in order to prioritise investment of time and resources in those activities that will accelerate their competitive advantage as markets recover. But how many truly understand what sets them apart? A genuine competitive advantage isn’t just about being better—it’s about being different in ways that matter to customers and are difficult for competitors to replicate. Looking Beyond the Obvious Traditional thinking often leads manufacturers to focus on standard metrics like price, quality, or delivery times. While these factors matter, they rarely constitute a sustainable competitive advantage. Every serious player in manufacturing strives to optimise these elements, making them table stakes rather than differentiators. The key lies in identifying unique combinations of capabilities that create lasting value. Consider Toyota’s revolutionary production system—it wasn’t just about efficiency, but rather a holistic approach combining worker empowerment, continuous improvement, and waste reduction that took decades for competitors to understand, let alone replicate. The Three-Step Analysis Framework Customer Value Mapping Start by mapping your customers’ entire value chain, not just their immediate needs. What challenges do they face upstream and downstream? A manufacturer of industrial fasteners discovered their true advantage wasn’t in the products themselves, but in their ability to provide engineering support that helped customers optimise their entire assembly process. Document every customer touchpoint and gather data on: Problems customers face that they haven’t […]

Fixing manufacturing’s billion-dollar harm problem

Jane Finlayson, EMA Head of Manufacturing Harm in New Zealand manufacturing is unacceptably high and urgent action is needed. The good news is that through a recent partnership between the Accident Compensation Corporation (ACC) and the Employers and Manufacturers Association (EMA), help is on the way. ACC claims costs for the manufacturing sector have skyrocketed, exceeding $165 million annually, with weekly compensation costs doubling from $51 million to $109 million between 2015 and 2024. Health and safety regulator WorkSafe estimates that chronic harm results in a staggering loss of 5,000 disability-adjusted life years each year, contributing to an economic burden of approximately $1.23 billion. The breakdown of this burden is alarming: 27% of injuries stem from musculoskeletal disorders, 17% from mental health issues, 16% from cancers, and 15% from respiratory problems. In a significant stride towards addressing this harm, ACC appointed the EMA to lead a by industry for industry project to create a harm reduction action plan. The EMA stood up Project Whakahaumaru, which translates to ‘safeguard’ or ‘protect’, and gathered the perspectives of around 200 stakeholders from the manufacturing sector, health and safety professionals, and WorkSafe via focus groups, one-to-one interviews, co-designed workshops and surveys. EMA Head of Manufacturing Jane Finlayson says the recently released results of this discovery phase have been sobering. “We embarked on this journey to safeguard our industry, and the findings highlight a pressing need for change,” Finlayson says. “Injuries are not just numbers; they represent lives affected, families impacted, and potential futures altered. “We cannot ignore the implications of these injuries – not only for the workers but for businesses and the economy as a whole. “These figures are a call to action.” Over the past year, the EMA has worked with stakeholders across the sector to develop the Project Whakahaumaru Harm Reduction […]

Steel awards showcase local industry’s expertise and sophistication

Steel Construction New Zealand (SCNZ) is pleased to announce the results of 2024’s SCNZ Excellence in Steel Awards. The winners were announced in Rotorua recently, where close to 300 structural steel industry leaders and specialists gathered to celebrate the best of the best at an event that showcases the sector’s commitment to innovation, best practice and collaboration. Each year, the task of judging becomes increasingly difficult. This year, 24 finalists were selected from a pool of more than 50 outstanding submissions across an impressive array of structural steel applications. Together, they reflect the endless possibilities of structural steel, demonstrating the remarkable design and execution possible when steel is the primary construction material. “This year’s entries have once more showcased our industry’s ability to produce remarkable work,” says SCNZ Chair Malcolm Hammond. “We are a progressive industry that continues to add significant value to projects through our unparalleled knowledge of steel construction, and our appetite to collaborate with our clients and design teams.” “It has been the most hotly contested awards to date and, anecdotally, has produced some of the highest and closest scores ever seen in the SCNZ Awards,” says SCNZ General Manager Darren O’Riley. “It is a reflection of the industry’s continued evolution and sophistication.” The 2024 Supreme Winner and Category Winners are: Supreme Winner and Standalone Residential Category Winner: Grayson Engineering for Geo Domes This stunning domed structure in Mangawhai consists of two residential dwellings constructed from rolled and formed heavy universal column and beam sections. Measuring 42m by 42m and 7.5m high in the centre, the larger dome is comprised of 110 tonnes of steel. Steel was the only viable material for the domes, offering the required strength, durability, quick on-site assembly and cost-effectiveness to meet the design specifications. Coordination between the steelwork and the builder, along […]

Aotearoa’s Industry 4.0 journey

From November issue, NZ Manufacturer magazine (below) Sean Doherty, Product Manager, Callaghan Innovation The advent of Industry 4.0 has been a game-changer for the manufacturing sector and can deliver real returns for New Zealand businesses, through increased efficiency, productivity, and innovation. However, many manufacturers remain hesitant to embrace these technologies. This reluctance often stems from persistent myths that cast doubt on the practicality and benefits of Industry 4.0. Based on Callaghan Innovation’s experience working with New Zealand manufacturers who are on their Industry 4.0 journey, we’re keen to dispel some of these common myths and provide some evidence-based solutions to encourage Kiwi manufacturers to confidently step into the future with Industry 4.0. … Myth 1: Industry 4.0 is only for large manufacturing operations. The Reality: Industry 4.0 is not exclusive to large manufacturers. Small and medium-sized enterprises (SMEs) can also leverage these technologies to enhance their operations. Indeed, as a nation of SMEs, this is where Industry 4.0 technologies arguably have the most potential to boost this country’s productivity and economic output. Companies like Nautech Electronics, Gyro Plastics and Oasis Engineering, are all great examples of SMEs deploying Industry 4.0 technologies to good effect. The key is to start small and scale up. For instance, SMEs can begin by implementing IoT sensors and use data analytics to optimise their existing processes. Retrofitting new hardware systems to older equipment can be a cost-effective way to integrate Industry 4.0 technologies without the need for significant upfront investment in new machinery. Myth 2: Exorbitant costs outweigh the benefits The Reality: While initial investments may seem daunting, the long-term benefits of Industry 4.0 technologies can lead to substantial cost savings and increased efficiency. Several McKinsey and Company case studies show manufacturers gaining a 10-20% increase in efficiency, between 10-15% improvement in quality and […]

5S – Not That Old Chestnut

Ian Walsh, Partner, Argon & Co NZ I was reflecting recently on how many business owners have started an improvement program with 5S and failed. Before I talk about the “why” and the “how” 5S implementations fail in these businesses, and for those who haven’t come across 5S before, allow me to briefly explain what 5S is. 5S is a practice that was developed at Toyota in the 1960s. 5S consists of 5 “S’s” based on Japanese words and the associated anglicised word: Seiri (Sort) – Eliminate unnecessary items from the workplace. Seiton (Set in Order) – Organize the necessary items so they are easy to use and accessible. Seiso (Shine) – Clean the workplace and keep it clean. Seiketsu (Standardise) – Standardise the best practices within the workplace. Shitsuke (Sustain) – Ensure discipline and commitment to maintain the 5S processes. All the business leaders that I’ve talked to about failed 5S implementations were unable to maintain the “standardise” and “sustain” the initiative. After a period of time, standards slipped and then eventually (or quite quickly) returned to the previous level with a few artifacts remaining. Most of these leaders said “we tried that, it didn’t work”. This needs a deeper analysis. There are examples across the globe of world-class companies that rely on 5S as a core practice and have succeeded in sustaining the practice. On that evidence, surely it’s not that 5S itself fails, but that particular implementations fail? Many of these business leaders I talked to stated that they were told something along the lines of “if you can’t do 5S you can’t do anything”, and so they started their improvement journey with 5S, usually with help from a “mentor”. Typically, they would do a 5S exercise in an area in 1-2 days and then move into […]

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