Business News

Tony Robinson, Trade Commissioner Singapore There is growing demand for high-quality frozen meat, seafood, and convenience foods. As the shipping and logistics hub of Southeast Asia, Singapore is a gateway to the Association of Southeast Asian Nations (ASEAN) region. This makes it an ideal base for the South East Asia/Asia Pacific operations of many multinationals and New Zealand businesses operating in the region. Singapore is a highly developed market for food and beverage products, with affluent and sophisticated consumers looking for quality products and value for money. Singapore is New Zealand’s 6th largest trading partner and 13th largest market for F&B products with exports valued at NZ$546 million. There is very little domestic food production in Singapore and a heavy reliance on imports with up to 90% of their food sourced internationally. There is growing demand for high-quality frozen meat, seafood, and convenience foods, as well as a growing consciousness around sustainability, organic products and functional foods. The food and beverage opportunity is being given a boost by the Singapore government’s current drive for increased productivity. Compared with its low-cost neighbours, Singapore is a more expensive place to operate from, and this contributes to a drive for smarter, higher-value manufacturing. So food and beverage goods and services that help drive productivity are of increasing interest. Opportunities in Singapore for food manufacturers are also driven by changes in consumer attitudes. Sales of packaged food and ‘healthy’ products have increased as a result of consumers’ increasing consciousness about food safety and hygiene. Consumers are interested in branded, premium and added-value goods – crucial ingredients for a successful product launch in the country. Wealthy, time-poor consumers are looking for new processed and convenience foods, which can be sold at the premium end of the market. With growth opportunities available, the onus is on […]

Tim Anderson, Trade Commissioner Indonesia Around one third of the central Jakarta skyline has been built with input from Beca. The ever-changing skyline in Jakarta is a constant reminder that the development potential in Indonesia – ASEAN’s largest economy – is fast being realised, and New Zealand companies are playing their part. Beca’s engineers have been in Indonesia for more than 40 years and around one third of the central Jakarta skyline has been built with input from Beca. They have numerous building projects on the go, for example the Signature Tower which will be the southern hemisphere’s tallest building at around 115 levels, with 450,000 square metres of commercial space. New Zealand’s companies are also well poised to take advantage of the growth in aviation infrastructure. Glidepath provided the baggage handling system for the recently opened Surabaya Airport Terminal 2, the terminal built to meet growing demand in Indonesia’s second biggest city. Indonesia has 799 documented airstrips, including 233 airports (29 of which are for international traffic) and this is expected to grow to 299 by 2020. However, many of Indonesia’s airstrips across the archipelago are in remote “hot and high” conditions making flying conditions challenging – perfect for Pacific Aerospace’s P-750 XTOL extreme take-off and landing aircraft. The Indonesian State Planning agency recently noted that passenger movements across Indonesia are expected to reach 350 million by 2025 and the infrastructure investment required to meet this growth in numbers is estimated to be over $US15 billion. The current terminals at Jakarta Soekarno-Hatta Airport (known as Soeatta) – named after the first Indonesian President and Vice President – were designed to handle 22 million passenger movements. Last year, more than 60 million went through the airport which is more than Changi in Singapore and more than 4 times that of […]

Richard White, Trade Commissioner, New Delhi Technology and services provided by New Zealand companies are successfully finding niches within this huge growth.     The election earlier this year of a new government with a strong focus on economic growth is breathing new life and confidence into the Indian economy. Prime Minister Narendra Modi has launched a number of major initiatives including the ‘Make in India’ programme which aims to turn the country into a global manufacturing and exporting hub. Manufacturing currently contributes only 15 percent to India’s GDP, and the plan is to raise it to 25 percent through cutting red tape, developing infrastructure and making it easier for both local and foreign companies to do business. An estimated US$350-400 billion of private sector investment will be poured into infrastructure development in the five years between 2012 and 2017 to develop roads, ports, rail and airports. Mr Modi also wants to build 100 “smart cities” throughout India. Foreign governments have already committed major sums into infrastructure, e.g. Japan will invest US$35 billion into the Delhi-Mumbai industrial corridor while China will support development of high speed rail services connecting major Indian cities. Infrastructure development will extend into food processing, though the construction of mega food parks to help the industry grow from a current value of US$102 billion to US$260 billion by the end of 2015. India is the second largest global producer of horticultural products but only processes 10 percent of what it produces, and only 2 percent of fruit and vegetables produced in India are processed. The construction sector is projected to show an 18 percent CAGR over the next five years, this off a base of $441 billion revenue generated by the sector in 2013 including $325 billion of residential construction. What does this all mean for […]

Goskin Duman, Country Manager – Turkey Turkey continues to offer exciting opportunities for New Zealand businesses. Not only was bilateral trade at an all-time high of US$173.8 million last year, but relations are strengthening between New Zealand and Turkey with the commemoration next year of 100 years of ANZAC. The Turkish economy continues to prosper with 4 percent growth in 2013, and 4.3 percent in the first quarter of 2014. There is a growing middle class hungry for products and services. Istanbul alone is home to 17 million people. Organic products, healthy food supplements and sophisticated food and beverage products show around 20 percent growth rate in the last five years. With Turkey’s unique geographic position straddling both Europe and Asia, the country is increasingly becoming a hub for multinationals supporting the Middle East, Europe and Africa. Political unrest in parts of the Middle East is affecting exports, yet in 2013 exports reached US$151.7 billion. GDP per capita is now $US10.782 and increasing year-on-year. Turkey manufactures 60 percent of all its industrial goods in an area stretching from Bulgaria to the Chinese border – in other words from Eastern Europe all the way down to Asia. Turkey has started to become a major world player in a number of sectors. It is: • the second biggest flat glass manufacturer in the world • the fifth biggest automotive manufacturer in Europe • the eighth largest shipbuilder in the world and fifth in mega yacht manufacturing • the largest manufacturer of durable goods in Europe. While trade between Turkey and New Zealand is increasing, it is off a fairly low base. New Zealand’s traditional exports of butter and other dairy products, raw skin and aluminium have been the mainstay of our exports. But over the last three years we are seeing an […]

Glen Murphy, Regional Director NZTE, Greater China  Do you predominantly think of China as a market to sell your products to or do you think of China as a customer with unique needs that you could help with? The way people talk about China would suggest many take the market view. If that’s your approach you need to ask yourself: ‘To what extent could we increase the value of our relationship by creating more complete solutions?’ Are you building long-term trust with your customer that will sustain your businesses through the inevitable ‘hiccups’ in any relationship? And China does have needs New Zealand can help with: Safe food There is a well-discussed need for food products and a safe supply chain the Government and consumers can believe in. Maybe it’s time to stop thinking about food safety requirements for China as a compliance hassle and think about the opportunity to gain a competitive advantage by meeting these needs and communicating to Chinese consumers in creative ways? The middle class This consumer group is significant, growing and getting more sophisticated in their desire to buy experiences, products and services that reflect their values and express their personality. Let’s understand these needs and provide premium, high quality products and services that allow Chinese consumers to express themselves. Urbanisation The rate of urban growth means huge numbers of people are seeking leisure options as part of a modern urban lifestyle. Kiwis are creative about how we use our leisure time, so let’s teach our Chinese customers how to enjoy theirs. The environment It’s no secret that China’s growth has come at serious cost to the environment. As the country reaches a tipping point of wealth, they are trying to address these problems. We love the environment in New Zealand, so let’s help China […]

Dr Wolfgang Scholz, Director Heavy Engineering Research Association (HERA) The New Zealand heavy metals engineering industry overall had an outstanding year of growth. The 12 monthly rolling totals for heavy steel usage in NZ end of September stood at 151,000 tonnes p.a., while a year earlier it was 130,000 tonnes, an increase of close to 16%. However, the fact remains that the industry is still around 20% below its October 2008 pre-GFC peak of 179,000 tonnes of heavy steel usage – so there’s room for further growth. Looking specifically at sub-sectors, steel construction was the winner with considerable market share growth particularly in multi-storey construction in Canterbury, where market studies indicate that 70% of buildings currently under construction are going up with a structural steel frame. The New Zealand steel fabrication capacity discussion continues but with less intensity. Main clients are realising that the industry is responding to increases in demand by putting more highly efficient plant in with expanded capacity. They also recognise the capacity reserves by the industry with potential for multiple shifts, something which can be done with relative ease in the factory-based steel construction environment. No doubt the year’s biggest industry achievement was the introduction of the Steel Fabrication Certification (SFC) scheme in a joint effort between HERA and Steel Construction New Zealand (SCNZ), and industry members. In a short time, eight New Zealand steel fabricators have achieved the SFC and ISO 3834.2 certification. This new scheme raises the bar by providing independent, expert certification of New Zealand steel fabrication companies. The scheme ensures participating fabricators have appropriate personnel and quality management systems in place, meeting national and international best practice standards giving assurance to its clients that indeed the expected quality is being achieved. The general and not steel-construction focused sectors of our industry had […]

Tony Waite.                New Zealand is a fantastic place to do business.      Trade Shows play a significant role in the growth in business across the country. A face to face platform to taste, feel, smell and sight the latest business innovations, products, services, expertise and methods to grow your business to new levels. No wonder then that the tagline for NZ’s largest trade exhibition organiser, XPO Exhibitions (XPO), is “Showcase. Educate. Sell.” Tony Waite, National Events and Sales Director talks to NZ Manufacturer about the XPO’s position in the New Zealand business environment, 2014 in business and their activities in 2015. How has XPO found 2014? 2014 has been a very busy, exciting and rewarding year indeed! We expanded our portfolio through the purchase and acquisition of the Haley Media pofrtfolioportfolio of trade events. We launched and sold out in record time a brand new event, buildnz | designex Canterbury, which we’re excited to confirm will be a regular fixture in our calendar going forward. Concurrently we’ve been investing in exciting new smartphone lead retrieval technology that will exponentially enhance both exhibitor ROI and visitors’ event experience. New technology is to be launchedbe earlylaunched early in 2015. Across the shows we have seen increased visitor attendance at each and every one of the 6 events we ran in 2014. Some of those increases are the highest in 10 years, and to top it off we have won, for the second year running, best in class industry awards from the Exhibitions & Events Association of Australasia. (Deep breath, exhale!) What do you consider to be XPO’s prime role in the business community? XPO’s trade events provide effective, engaging and dynamic forums that allow industries to connect and grow, and, in doing so, foster […]

-Catherine Beard, BusinessNZ Looking back at the various measurements of manufacturing activity over 2014, the overall picture is one that Kiwi manufacturers can be proud of. Despite challenges, the BNZ – BusinessNZ Performance of Manufacturing Index (PMI) has continued to expand throughout the year. It was rising steadily in the first quarter, and while it did flatten out in the second quarter, it still remained in expansion territory (above a 50.0) and has been steadily increasing since. According to Statistics New Zealand’s Economic Survey of Manufacturing June 2014 quarter, that flattening out can mainly be attributed to meat and dairy manufacturing. The survey reported that “After adjusting for seasonal effects, the volume of total manufacturing sales fell by 0.7 percent. This was led by a 1.4 percent fall in meat and dairy product manufacturing. “The sales volume for total manufacturing, excluding meat and dairy, was up 0.1 percent in the June 2014 quarter. Sales fell for seven of the 12 manufacturing industries in this group. When the effect of price changes is included, the total value of manufacturing sales fell 1.9 percent ($481 million). This decrease was driven by a 5.7 percent ($485 million) fall in meat and dairy product manufacturing sales.” By October, the BNZ-BusinessNZ PMI (the most recent one at the time of writing this article) stood at a healthy 59.3, and the survey results showed employment at its highest ever level since the survey began in 2002. As the October report’s title “Staff Wanted” suggests, this provided another boost in the arm for the sector and sends a signal of confidence. In addition, the proportion of positive comments from manufacturers (68.7%) was well up on results from previous months. This all bodes well for a healthy end to 2014. As the Bank of New Zealand reported on […]

Jane Tongatule, General Manager, Greater East Tamaki Business Association Inc. (GETBA) East Tamaki is Auckland’s largest industrial precinct. This significant manufacturing and distribution hub continues to grow at a rate higher than the regional average and provides 30,000 jobs. Business NZ’s Performance Manufacturing Index has shown continued growth since mid-2014, and industry-leading local manufacturers such as Fisher and Paykel Healthcare and GMP Pharmaceuticals are evidence of this. GMP Dairy, a division of GMP Pharmaceuticals, opened a second canning line at GMP Dairy’s plant in East Tamaki in September. Fisher & Paykel Healthcare have had another strong year and also feature in the TIN 100 (Technology Investment Network) leading technology businesses. Companies such as Bobux International and Alpha Laboratories have grown their exports, despite the challenge of the high NZ dollar. It is heartening to see the 2014 Exporters Survey undertaken by Export NZ shows exporters planning for growth, which bodes well for 2015. It’s clear that manufacturing is changing and that there is more emphasis on technology and innovation. Investment in new plant and capital equipment, which has historically lagged is moving in the right direction, up 9% on an annual basis. We have seen several local companies increase their focus on R&D. East Tamaki businesses including SIKA Technology Ltd, Tandarra Engineering and Technopak Limited have been recipients of R&D funding this year. SIKA Technology is an example of the change in manufacturing, moving from a traditional foundry business to a company that specialises in the design and manufacture of high quality, innovative cast aluminium solutions. In August Fisher and Paykel Appliances, acquired by China’s Haier in 2012, sought some 40 workers for research and development after opening a new design centre at its East Tamaki headquarters. It is now one of Haier’s five global centres of excellence for product […]

Manufacturing is about people.   -Roger Usmar, Sector Development Manager, Competenz A manufacturing career that spans ‘shop floor to senior management’ in operations, competitive (‘lean’) manufacturing and human resources has helped Roger Usmar understand the challenges manufacturers face. It’s also convinced him that investing strategically in training to build a skilled and adaptable workforce is one of the keys to managing these challenges. Now Sector Development Manager at manufacturing industry training organisation Competenz, Roger shares his thoughts on how to build training into an effective workforce development strategy. “Attracting good people, then building the skills they need in a competitive manufacturing environment, is a challenge – and it’s one New Zealand manufacturers need to take seriously,” says Roger who joined Competenz in October. “In my thirty-plus years in manufacturing with Fonterra, Kiwi Dairy and Woolworths, I’ve seen the difference a good workforce development strategy makes – and the vital part training plays in supporting the company strategy. “Manufacturing is about people. You can have the best technology, but without engaged employees with strong technical and commercial skills, who can solve problems, adapt and look for continuous opportunities to improve, you won’t get the best from this technology.” Roger recommends manufacturing companies take a structured approach to training, whatever their size. He shares his recommendations: 1. Put training on your board agenda. “Your people’s skills and competencies can be a critical risk or major asset in executing your strategy. So I’d like to see people development discussed around every board table in the country, every month. Directors should scrutinise training plans and budgets the way they do investments in new plant.” 2. Look ahead. “Skills take time to build, so companies need to be constantly looking ahead. When you produce your strategic business plan, map out the skills you need to […]