Business News

How are you going for serious news?

-Doug Green This latest noise going on about Campbell Live has, quite rightly, a lot of people up in arms. The show is a bastion of strong support for community and political issues and of John Campbell keeping an eye out for the little guy. The program has never pretended to be anything else and has tackled some pretty large issues such as the Christchurch earthquake for the common cause. When insurance companies are slow paying and builders take too long putting up, Campbell Live informs and forces the protagonists to face the antagonists and stand to attention. What TV3 management does with its programming is its business. If they want to make an ill-considered opinion to get rid of the show they have the right to do so. If they want to have egg all over their face and make a silly decision that is also their right. But they must remember the viewer, the public way out there in the suburbs, is quite capable of switching off – or switching over – when palaver ruins their evening. If no decent current affairs is available – or to be replaced by some variety show or the second coming of the man or woman looking for a partner- then forget it. The public is not going to stoop to that level and, who knows, may switch over to SKY News Australia, the BBC, Fox News or CNN where there are plenty of current affairs shows run by decent presenters like David Speers and Megyan Kelly who discuss the same issues (as John Campbell does). In case you think I’m rooting for John Campbell and ‘a lefty’ I am merely looking for a sense of fair play, a balance. There are ‘blue’ voters in NZ and there are ‘red’ voters in […]

Innovation funding a boost to competitiveness

Incentives for firms to invest in innovation are welcome, says BusinessNZ. An $80 million increase in funding for Growth Grants announced today will provide more incentives for companies to increase their research and development, BusinessNZ Chief Executive Phil O’Reilly said. The Growth Grants, administered by Callaghan Innovation, are allocated to firms that spend at least $300,000 per year, and 1.5 percent of their revenue on R&D for two years. Mr O’Reilly said the funding was well-targeted. “Given budgetary constraints faced by the Government, it is positive that the choice has been made to allocate funding where it can be most effective – in prompting innovation by New Zealand companies. “Innovation in goods and services is the best way for New Zealand firms to compete in world markets, and to counteract the effects on exporters of the strong dollar. “Funding premised on R&D investment by firms themselves is sound policy which will be welcomed by the many New Zealand firms seeking to innovate and upgrade.”

Budget boost to R&D funding welcome though underwhelming

Boosting New Zealand’s business investment in R&D and innovation is a top priority and today’s announcement though welcome is not entirely persuasive, says Kim Campbell, chief executive of the Employers and Manufacturers Association. Science Minister Steven Joyce has just announced business R&D funding will rise in this year’s Budget by $80 million over four years. “This is another positive sign the government is committed to lifting our business performance in R&D and innovation,” Mr Campbell said. “The amount of investment in R&D and innovation are fundamental vectors of our economy’s future success. “But at present we’re going backwards, with a lot of ground to make up. “In the two years to December 2014 Statistics New Zealand figures show business investment in R&D grew just four per cent whereas the economy overall grew 3.1 per cent in 2013 and 3.5 per cent in 2014. “The largest fall off evident was in investment in manufacturing R&D. “Our business spend on R&D already lags far behind the developed world and our trading partners. “OECD figures show we rank 21st behind Portugal and the Czech Republic, and well adrift of Australia. “The increased commitment will help but its not the step change needed to reverse the decline and power exports up to 40 per cent of GDP by 2025. “The targeting of research funds to qualifying businesses has worked up to a point, but other policy options need further exploration in a wholehearted effort to get a larger percentage of businesses participating in R&D and innovation activities.”

ManufacturingNZ and ExportNZ welcome increased funding in R & D

Executive Director of ManufacturingNZ and ExportNZ, Catherine Beard welcomes the increase in R&D funding from Government. “We have been urging the Government to keep on increasing investment in R&D. It’s one of the key ways our businesses will be globally competitive. New Zealand has lagged behind in this important area compared to other OECD countries, both in terms of government investment, and private sector investment. “We are in catch-up mode and it’s great to see the Government recognising this will add value to our exports and grow bigger and more sustainable companies. “The latest statistics show that between 2012 and 2014, business investment in R&D has increased by 4%, with a big increase in services (19% increase), and of that category, computer services have increased investment by a massive 41%. “Statistics New Zealand reports that the main motivation for undertaking R&D for business is entry into new markets. “In a country of small to medium sized firms that are doing battle with much larger competitors in overseas markets, one way to stand out from the competition is through innovation. Innovative products can also command a price premium which is increasingly important with a high NZ dollar.”

Nuplex beefs up investment plans across Asia

Nuplex Industries, the specialty chemicals manufacturer, is exploring more investment opportunities across Asia, having shifted its businesses away from the firm’s traditional markets in Australia and New Zealand. The Auckland based company officially opened a US$35 million plant in China’s Changshu, and is already considering expansion plans for the site, where it holds a 50 year lease. The company was caught out by under investing in Asia, and has since increased efforts in the region, spending $60 million over the past four years. Chief executive Emery Severin says China, as the world’s second biggest economy, looms large in those plans, as does the rest of South East Asia. “Here in Asia, our total South East Asia business is bigger than China,” he told a visiting ministerial delegation, led by Economic Development Minister Steven Joyce. “We expect China to the biggest business in maybe 10 years’ time, but we see South East Asia as being just as important in terms of growth.” For profits derived from Asia, China accounts for about 40 percent, while South East Asia contributes 60 percent, Severin said. Nuplex has been assessing its plans for further growth initiatives in emerging markets, and has previously said it would update shareholders following a review at the end of the June quarter. That’s included the sale of two Australasian Masterbatch and Specialities units, which Nuplex says leaves it to focus on the global resins business. Severin said Russia was a largely untapped market where Nuplex has invested about $10 million to chase growth, and would expect to spend between $30 million and $40 million over the next couple of years. The company’s shares last traded at $3.25 and have declined about 3 percent in the past year. The stock is rated a buy based on the consensus of six analysts […]

Inaugural lecture to explore organisational challenges in an outsourced world

A Victoria University of Wellington professor will provide insights from over 25 years of research into how information technology has changed the way we view and work in organisations, in his upcoming inaugural lecture. Professor of Information Systems, Benoit Aubert, says the trend of organisations contracting some of their services to an overseas supplier or opening their own offshore branch (offshoring) or contracting local suppliers for aspects of their business (outsourcing), has led to changes in the way that organisations are defined and how they innovate. “Outsourcing in recent years has challenged our understanding of supply chain, country of origin and business relationships,” he says. “For instance, supply chains are becoming very difficult to track. Labels telling you what country a product is made in simply refer to the last step of production but do not reflect reality. Almost everything we buy has been manufactured in multiple steps, in numerous different countries.” Professor Aubert will discuss challenges that managers need to consider when transferring part of their business activities overseas. “Relentless market pressure increases companies’ use of outsourcing and offshoring to lower costs. Offshore activities are especially difficult to monitor. This makes it more difficult to always adhere to socially responsible practice and can lead to reputational damage. Companies are at risk of seeing their product and image associated with questionable practices.” It is harder to maintain control in such a decentralised environment, Professor Aubert says. At the same time, the trend is unescapable. “Managers need to identify ways to innovate at a much faster pace than before. To do this they need the knowledge and skills of outside partners. This creates a more complex environment. “It’s important that managers keep a broad view of their company’s activities, including what’s happening in other countries, and monitor and track everything to […]

The Interview: Stephen Snedden

New Zealand Manufacturer recently asked Stephen Snedden, the inventor, where he finds his inspiration and when it all began. NZM: When did you become an inventor? SS: As a young boy tinkering in my father’s shed with go carts and motor bikes and school projects. Dad was always working out solutions for problems as a self-employed electrician in his good old kiwi Shed. NZM: What was the first thing you made? SS: At high school doing workshop technology I was encouraged to do night school Jewellery class with Peter Hook. During the School C year we had to make a flint lock pistol, a knife, and pouch and brass cannon. It became a competition between all the class mates to do the best job. I managed to get top in my school for the School C year for workshop technology and technical drawing must say the ability to investment cast small parts helped a lot, NZM: What is your latest project? SS: My latest project is a rotational mould for a boat trailer body that can carry my boat but is also multi use as it can be used for a Jet Ski trailer or as a kids Slide on the water’s edge. It can float and be used as a floater to play with or for accessing boats on the water. It has 500 kg of flotation and can easily carry 3 paddlers, as a canoe. I have noticed after researching that no one’s supplying floating jet ski trailers worldwide so I’m going to see if I can make the market, NZM: What are you passionate about? SS: My family. I’m passionate about being able to create what we can dream of, being able to vision a product and draw it and then simply apply this to make it […]

SME growth coming off record highs

Growth among New Zealand’s small businesses has levelled off in the last six months with the economy entering a more stable phase, according to a nationwide survey of small business operators. Thirty-two per cent of SMEs saw revenue increase in the 12 months to February – down from a five-year high of 39 per cent in September – according to the latest MYOB Business Monitor. More SME operators are reporting stable revenue, however, up from 38 per cent to 44 per cent in the latest survey of over 1,000 business owners and operators from around the country, conducted by Colmar Brunton. MYOB New Zealand General Manager James Scollay says the latest survey shows that the SME economy has reached a point of more manageable growth. “While we’ve come off the highs reached through mid-2014, the level of stability we are seeing off the back of that period is encouraging,” says Mr Scollay. “Rather than the brakes going on, the SME economy looks to be settling into a period of sustained growth – especially when you take into account businesses’ projections for growth this year as well as the work they have on in this quarter.” According to the March MYOB Business Monitor, 40 per cent of SME operators expect their revenues to increase in the next 12 months, while a further 43 per cent are projecting stable revenues. Just 11 per cent are expecting revenues to fall in 2015. In the current quarter, 37 per cent of SMEs are reporting more work or sales in the pipeline, while 13 per cent are seeing less. Regions settling back While the widespread effects of the rebuild continue to push Christchurch SMEs to the top of the growth table, revenue increases in the city have fallen off somewhat in the last 6 months. […]

Kiwi WorldSkills team gets set for the trade equivalent of the Olympics

Twenty-six young Kiwi are preparing to compete against the best of the best competitors from Canada, India, Malaysia, China, Australia and Korea in the inaugural WorldSkills Oceania regional competitions to be held April 13-17 at Wintec in Hamilton. So far, 105 international competitors are registered to compete in a total of 30 different skill categories at the Oceania competitions. The NZ WorldSkills team will compete in 18 skill categories ranging from aircraft maintenance to the various auto and engineering trades, carpentry, joinery, plumbing and heating and go through to floristry, hairdressing, restaurant trades and web and graphic design. Competition will be intense for the under-23 year olds who are at the top of their respective trades for their age in the country. They will pit themselves against demanding international standards to battle it out to win one of 18 spots in the final WorldSkills NZ Tool Blacks team that will go to Brazil in August to face off against competitors from 71 other countries. Each competitor has a personalised, hands-on mentoring programme to ensure they have the best shot at winning a medal. This includes “mental toughness” training developed exclusively for WorldSkills NZ competitors. Rural and provincial New Zealand is well represented in the 26-strong national team. One of the gifts of WorldSkills competitions is the confidence the kids gain in their own abilities. It’s helped by receiving the endorsement of a positive peer and skill group that’s with them every step of the way. How you can help support the Tool Blacks: • Come along and cheer the team on at Wintec in Hamilton,Thursday 16 April and on Friday 17 April from 9am –12noon. . • If you are interested in fundraising or sponsoring or donating to help get the Tool Blacks and their Skill Managers to Brazil in […]

Companies need more scale to tap into India’s fast-growing economy

Indian billionaire Nandan Nilekani says scale is a problem New Zealand companies need to overcome to crack the growing Indian market. Nilekani has been twice named by Time magazine as one of the world’s 100 most influential people and is the former chairman of the Unique Identification Authority of India (UIDAI) which is providing all 1.2 billion Indian residents with a unique identification number. He is also co-founder of Infosys Technologies, which has 100,000 employees. Nilekani understands scale, even in his philanthropic efforts. After losing a bid to get into politics last year, he’s poured US$10 million into a not for profit initiative, ekStep, which is developing a platform based on gamification to change the way primary school education is taught in India. The first iteration of the platform will be released next month and Nilekani said while it was aimed at resolving India’s literacy and numeracy problems, it could easily be rolled out in other developing countries. In his first visit to New Zealand, Nilekani said what struck him about the Kiwi companies he’d talk to was they weren’t used to dealing with scale because of the country’s small population. “Scale is not something you do after you have built your solutions. If you’re going to have an impact in India, you have to have scale, and solutions need to be made differently so they’re highly automated, low-cost, and developed so they can be used anytime, anywhere,” he said. New Zealand companies tend to be low volume and high cost and it needs to be the other way around to do business in India, which is a “price sensitive” market, he said. Developing scale is a mindset, said Reuben Abraham, chief executive of Indian think tank the IDFC Institute who, along with Nilekani, was in Auckland for the India […]

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