Business News

 The latest New Zealand Manufacturers and Exporters Association (NZMEA) Survey of Business Conditions completed during November 2013, shows total sales in October 2013 increased 14.82% (export sales increased by 36.52% with domestic sales decreasing 4.96%) on October 2012.  The NZMEA survey sample this month covered NZ$490m in annualised sales, with an export content of 57%. Net confidence rose to 18, up from the 0 result reported last month. The current performance index (a combination of profitability and cash flow) is at 103.7, up from 98.3 in September, the change index (capacity utilisation, staff levels, orders and inventories) was at 103, up from 100 in the last survey, and the forecast index (investment, sales, profitability and staff) is at 103.5, up on Septembers result of 102. Anything less than 100 indicates a contraction. Constraints reported were 73% markets, 18% production capacity and 9% capital. Net 27% of firms reported an improvement in productivity for October. Staff numbers for October increased year on year by 0.35%. There was a moderate staff shortage in each of the five areas  measured: operator/labourers, tradespersons, supervisors, professional/scientists plus managers. “This month is generally more positive on last month, exports are up against a falling trend throughout 2013 and domestic sales have turned south against a positive trend since the middle of the year.” says NZMEA Chief Executive John Walley. “Our indexes have improved on last month and staff numbers are continuing their small but positive trend.” “It is too early to tell whether this improvement in export sales will continue, commentary is mixed and the depreciation of the Australian dollar and movements in the American dollar are not helping.” “Other data has been showing general economic improvement particularly for the domestic economy, and for exports this largely relates to commodities for China. Non-commodity exports to other […]

The law change proposed by MP Paul Goldsmith to allow high earners to contract out of the personal grievance provisions of the Employment Relations Act would save taxpayers money and help free up court time, says Employers and Manufacturers Association Chief executive Kim Campbell.  “Mr Goldsmith’s Bill would give an employer and staff earning over $150,000 a year the ability to make their own arrangements should they fall out,” Mr Campbell said. “High earners should be allowed to sort out things like this amongst themselves and at their own expense. “It’s a useful idea. It would save on mediation and court time otherwise taken up by personal grievance cases, and reduce a business risk. “Since the law would be voluntary when the parties drew up their employment agreement, a third party representative such as a union could have their say about it at the time.  “It’s a useful, sensible proposal.”    

New Zealand has won two one-off Awards of Merit and a prestigious company award at the International Federation of Consulting Engineers (FIDIC) Centenary Awards held in Barcelona, Spain. FIDIC represents global consulting engineering interests in over 90 countries.  Two Auckland projects, the Britomart Transport Centre and Newmarket Viaduct Replacement Project, were among the 23 Awards of Merit announced. Over 97 projects from all over the world were entered and judged against a number of criteria including international recognition, technical excellence, innovation, how well they have endured, and their sustainability. FIDIC awarded Trophies of Excellence for projects, and to a small number of individual firms, for having made a significant contribution over the past 100 years of engineering, with New Zealand’s Opus International Consultants being honoured as a winner.  ACENZ is a FIDIC member and represented New Zealand at the conference and awards ceremony and is proud to congratulate these New Zealand projects and contributing companies for their now world renowned success in engineering.  Both the Britomart Transport Centre and Newmarket Viaduct Replacement Project have previously won Gold Awards at the ACENZ Innovate Annual Awards of Excellence.  

Things are set to get a little disruptive this week as close to 400 CEOs and senior managers from a wide range of New Zealand businesses descend on Auckland’s Villa Maria for New Zealand Trade and Enterprise (NZTE)’s sixth Better by Design CEO Summit. Held on Tuesday 22 and Wednesday 23 October, the theme of this year’s Summit is ‘Disrupt by Design’. Delegates will spend two days immersed in both the theory and real world examples of design thinking, design integration and design disruption, gaining valuable insights from those that are reinventing success in their industries. “This year’s Summit brings together global and local thinkers and doers who have successfully used disruption to create tangible change in their industries, and who are also working with others to make it happen. It’s also an opportunity to tell our own stories and to be inspired by New Zealand companies using design to transform themselves,” comments NZTE’s Better by Design Director Melissa Jenner. “In a global marketplace where competition is fierce, being ‘great’ is no longer good enough. The game changers are those that take risks and one of the few ways left to achieve sustainable success is to disrupt by design.” Jenner says companies can use design to disrupt their business model, their distribution strategy, and their marketplace. “By being brave and exploring the unknown, companies are more likely to achieve turbo-charged growth.” Key speakers at the CEO Summit include: • Aura Oslapas is the former Senior Vice President and Chief Design Officer of Best Buy. Aura has helped transform the consumer electronics company into the clear authority and destination for technology products and services in the consumer-driven, omni-channel world. • Ken Hong is General Manager of Weibo Marketing Strategy at Sina, a Chinese online media company for Chinese communities around the […]

Continued high levels of new orders ensured the manufacturing sector remained in expansion, according to the latest BNZ – BusinessNZ Performance of Manufacturing Index (PMI).  The seasonally adjusted PMI for September was 54.3 (a PMI reading above 50.0 indicates that manufacturing is generally expanding; below 50.0 that it is declining). Although this was the second consecutive month the level of expansion has declined, compared with previous September results the 2013 value was the highest since 2007. Overall, the PMI has averaged 56.1 since the start of 2013.  BusinessNZ’s executive director for manufacturing Catherine Beard said that while another dip in the level of expansion was not ideal, the sector remains in a solid position. “Manufacturing activity has now been in expansion for 10 consecutive months, with 2013 remaining on track to be one of the best years for the sector in some time. Also, despite the lower level of expansion, the proportion of positive comments from manufacturers increased slightly from August, with residential building activity throughout the country being one of the drivers.” BNZ senior economist Craig Ebert said “While manufacturing growth has slowed from the eye-popping 59.4 in July, it is still in better than average expansion. Remember the line in the sand between expansion and contraction is 50.0, so the disappointment is simply that growth is decent rather than very strong. “A timely check to allay any anxiety is to compare it against the manufacturing component of Tuesday’s NZIER Quarterly Survey of Business Opinion (QSBO). Taken together, the PMI and QSBO signals remain relatively positive.” Three of the five seasonally adjusted main diffusion indices were again in expansion for September. New orders (58.8) again led the way for September, following consecutive post-60 results. Production (55.5) experienced another slight dip in expansion levels during September, while deliveries of raw […]

The New Zealand Agribusiness Centre, New Zealand Trade and Enterprise (NZTE), the Ministry for Primary Industries, and the Ministry of Foreign Affairs and Trade this week welcome the largest Colombian delegation to ever visit New Zealand. Some 170 Colombian farmers are spending a week in New Zealand to get first-hand insights into New Zealand’s pastoral farming systems and agritechnology. The visit includes an exhibition and seminar with major players in New Zealand’s agriculture sector at Mystery Creek Event Centre (home of Fieldays); fieldtrips to dairy, beef and sheep farms; and a visit to Landcorp’s pastoral farm development blocks near Taupo. Led by Fedegan, the Colombian Federation of Ranchers, the delegation to New Zealand follows Prime Minister John Key’s official visit to Mexico, Colombia, Chile, and Brazil earlier this year as part of the Government’s increased focus on strengthening bilateral relations and capitalising on trade opportunities with Latin America nations. It also follows on from New Zealand’s recent participation in AgroExpo, Colombia’s largest agriculture tradeshow. “Colombia is an emerging market for New Zealand agribusiness, and we are delighted to host Dr Carlos Severini, the Chairman of the Fedegan board, and this full delegation of Colombian farmers,” says Fieldays General Manager Commercial, Nick Dromgol. NZTE’s Global Agribusiness Programme Leader Haylon Smith says that Colombia has a fragmented but rapidly developing farming industry; a lot of their farms are remote without access to good transport, and there is a lack of what most New Zealand farmers have come to consider as basic farming management systems and practices. “This presents a significant opportunity for New Zealand agribusinesses who are leaders in pastoral farming and agritechnology, and have a reputation for producing internationally-significant research, agriculture practices and products,” Mr Smith says. “Many Colombian farms are run in a more traditional way compared to New Zealand, […]

The Youth Guarantee and other skills training schemes are clearly getting traction so it’s great they’re being expanded and added to, says Kim Campbell, chief executive of the Employers and Manufacturers Association, commenting on the training package announced today.  “We’re much encouraged by the government focus on getting younger people either into skills training or work,” Mr Campbell said.  “The expansion of these programmes broadens the suite of initiatives to help do this. “Their success is registered in the fall in the youth unemployment rate – amongst 15 to 19 year olds it was 27.6 per cent two years ago at the end of the June quarter down to 24.1 percent this year. “That’s still far too high. Over 30,000 unemployed young people represent a massive waste, and a future liability. “Expanding these schemes is the right response, and this will also help ensure the success of them by encouraging employers to take on younger workers at every opportunity.  “It’s difficult to imagine a better way to deploy the taxpayer’s resources.”    

The BusinessNZ Planning Forecast shows nearly all key indicators for the economy are positive.  The manufacturing and services sectors continue to show solid growth, international commodity prices remain firm, and business and consumer confidence are high. The construction sector is growing strongly, led by the Christchurch reconstruction and the flow-on effects of building seismic strengthening. BusinessNZ economist John Pask says data coming out of the major world economies show recent improvement, which is good news for New Zealand exporters.  “But high household debt is a continuing issue. When interest rates rise again, the cost of servicing high debt levels will adversely affect households. It will also likely impact on the NZ dollar to the detriment of exporters,” Mr Pask said.  The BusinessNZ Planning Forecast incorporates BusinessNZ’s Economic Conditions Index (ECI) which tracks 33 indicators, including GDP, export volumes, commodity prices and inflation, debt and confidence figures. The ECI sits at 17 for the September quarter, up 3 on the previous quarter and up 14 on a year ago.  The BusinessNZ Planning Forecast for the Sept 2013 quarter is on www.businessnz.org.nz        

The employment law changes currently before Parliament are part of the catch up process needed to reflect common practices already in place in today’s workplaces, David Lowe, Employment Services Manager for the Employers and Manufacturers Association told Parliament’s Transport Industrial Relations Select Committee. “The present law limiting a worker’s right to discuss flexible working arrangements to those with dependents is out of date,” Mr Lowe said. “It’s sensible that anyone can ask for flexible work hours for any reason, as proposed by one of the amendments. “Another seeks to change the current law which sets out precisely when coffee breaks can be taken. This is unworkable and openly flouted by employees and employers alike. “The law should simply require that reasonable breaks are provided then let those involved work out the details how it should apply to them. This is what happens now – the amendment is just catching up with the modern workplace. “Industrial action, the ultimate weapon, can cause long-term issues both within the workplace and for customers. The changes proposed are welcome as they will encourage strikes to be well considered and as orderly as possible,” Mr Lowe said.  

BusinessNZ has welcomed the prospect of lower ACC levies.  ACC consultation documents show employer, employee and motor vehicle levies are set for reductions of 15 – 17 percent next year.  BusinessNZ Chief Executive Phil O’Reilly says better management of the ACC scheme, based on sound insurance principles, is starting to deliver lower premiums. Experience rating, where employer levies can be reduced in response to a safe work history, is helping to keep the premiums down. The work and earners accounts are now fully funded and the position of the motor vehicle account is starting to improve.  A proposal to introduce risk rating for cars based on crash results is also a positive move, as safety features in newer cars can significantly reduce the number and severity of road injuries.  But the continued significant cross-subsidisation in the motor vehicle account is still a concern, Mr O’Reilly says. “Car owners are still significantly subsidising motorcycle owners. “Overall transparency could be improved, with an independent body preferable to the current political levy-setting process. “ACC has the potential to be still better governed and managed, to further reduce accident numbers and improve rehabilitation outcomes.”