Business News

Peter Chrisp, chief executive, NZTE Since I joined NZTE last September, I’ve been inspired by the business people who are NZTEÕs customers. Napier firm New Zealand Frost Fans is one company that really captured my imagination. It has developed a four-bladed fan for keeping frost off orchards and vineyards, which is quieter and uses less fuel than its competitors. Driving these competitive advantages, the company is growing fast. It is now exporting 80 percent of its output to markets as far afield as Turkey and Italy – and is gaining good market share. The really interesting part of this is the source of its innovation – an America’s Cup aerodynamics expert based in Napier who, combined with the outstanding engineering ingenuity and trade skills of Frost Fans, was able to design and build a world first. American industry experts had said, ‘It can’t be done’ – except it was, in New Zealand! It is great to see a primary industry base (horticulture) using innovation from other industries (the marine industry, via the America’s Cup), supported by great New Zealand engineering and trade skills. Stories like this, and many others, make me optimistic about New Zealand’s future despite the challenges we face as a small country located far from the world’s major markets. NZTE has had a clear message from the Government that more is needed to grow exports, which provide the tradable income this country needs. To help deliver on this, during the past year we have undergone a review that has taken into account customers, leadership, culture and costs. This involved reviews by both the private sector and the Government’s Performance Improvement Framework. Based on this information we worked with our public and private sector partners to develop a strategy to boost performance and target our efforts in support […]

The Pirtek Group is an international success story specialising in mobile ‘on site’ service and replacement of hydraulic and industrial hose and fittings. We operate under a proven franchise system and enjoy continued growth both internationally and within New Zealand. Not only a respected industry name, but universally trusted for our commitment to service excellence and customer focus. High end quality products and systems, continued growth plans, customer demand, and greater brand awareness have paved the way for us to establish new franchise opportunities for astute customer orientated people. Our businesses are suited to someone with a mechanical trade or mechanical aptitude, a sound understanding of business principals, customer focus and a commitment to existing and established operational methodologies under a franchise model. We have opportunities for both greenfield locations and existing Pirtek businesses for the right people. You may foresee that a Pirtek franchise could blend or integrate successfully into your existing business. Provision of service excellence and a personal approach to each and every customer are key components to maintaining a successful and profitable business.  

  Technopak director, Henri Hermans with a part of the latest innovative machine.     Technopak Limited typifies the value-added proposition our commercial and political leaders dream about – and some. You could describe the company as a by-product of our milk industry, but there’s much more to that. Mateship, hard graft, lots of travel and calling on customers and prospects all over the world, brilliant design engineering and today being up there with the best in the world.If you need proof: they recently doubled their floor space, and have already reached bursting point again. Nearly all – certainly most – of the customers for their powder-bagging lines and equipment or their upgrade consulting services are abroad in just about every country where there is significant milk production and major industry giants such as the legendary Land O’Lakes giant in Minnesota, USA. Founding partner, Shane Reckin, director, R&D was – inevitably – away when NZ Manufacturer met with co-founder, Henri Hermans, director design & projects, at their East Tamaki operation on the day of yet another significant milestone for the 2002-established company. He flies all-around the world frequently advising clients and securing business. A project manager was en route to the Auckland International Airport to fly to Colorado, USA to meet-up with the recently shipped state-of-the-art milk-powder bulk bagging-line, which he will take charge of installing for the US$420-million plant for the biggest mozzarella cheese producer in the world, Leprino Foods, which provides DominoÕs Pizza and Pizza Hut with product. And Henri had just confirmed the appointment in the USA of that country’s top powder-packing industry broker, to represent them, primarily in North America initially. These guys are going places, faster-and-faster as they prepare to sail through the 10-year barrier, into the big time. Expect them shortly to be joined […]

Dr. Jeffrey Liker will be delivering a 2-day workshop on “The Essence of Toyota Way” on 3rd and 4th of Nov 2011 at Sorrento in the park, Auckland. This is your opportunity to learn from one of the greatest lean advocates and an authority on the philosophy of Toyota Way. Please  email Vishnu@pslglobal.net or visit www.pslglobal.net for further information.

ExportNZ has released its election manifesto to all political parties today in the lead up to the 2011 election. Executive Director of ExportNZ, Catherine Beard, says our exports as a percentage of GDP have been declining since 2005, so all political parties should have some proactive policies in place that are supportive of exporting. “With a very small domestic market of 4 million people, it is only through exporting that we will grow bigger companies that can employ more people and allow for a better standard of living for New Zealanders”, she said. “An expanding export sector will help us pay our way in the world, whereas an expanding government / non-tradable sector will add to our debts”. ExportNZ is recommending the best policy approach includes: • Continuing with the free trade agenda; in particular there is strong support for a regional free trade agreement like the Trans Pacific Partnership, and achieving an FTA with India. • Ensuring that exporters have an internationally competitive business environment in New Zealand, which includes competitive tax rates, flexible labour market and a reduction in regulatory compliance costs such as the RMA and the Emissions Trading Scheme. • Reduced government spending to take the pressure off inflation thereby keeping interest rates lower and the dollar lower. • Efficient and competitive domestic and international transport options. • Effective market development assistance for exporters. • Increased government contribution to investment in R & D to get closer to the OECD average. • A strategy to boost the availably of venture capital and to attract foreign direct investment. • A strategy to boost the leverage of companies, such as the facilitation of better collaboration between companies on-shore to compete offshore. • A plan to put exporting front and centre of all government activity in order to grow […]

Sean O’Sullivan If we all had the ability to look forward like Henry in The Time Travellers Wife business would be in great shape. But we don’t and on a day by base we do the best we can creating some extremely good products for export in the time zone we live in. Which leads me to one of the key parts of October issue, our focus on Export Success. Many people have been part of the energy which has brought this section together and their views, observations and experiences have been invaluable. The chief executive of Opportunity Hamilton, Sandra Perry, tells us about the Waikato’s specialist manufacturing sector which is making a global impression. This includes companies such as Gallagher and NDA, Micro Aviation and ASR. On the north shore of Auckland is Fraser Cars handcrafters of Lotus 7 replicas since 1988 with up to 65 percent exported overseas. Marque Magnetics, another Auckland company, which designs and manufactures transformers, chokes and a wide range of specialty electronic wound components, has companies from Asia and the USA utilising their services. Adam Bennett, NZTE”s director of specialised manufacturing sees his organisation’s focus as being on marine, aviation, geothermal, advanced materials and building solutions companies. Those who are good at Modularity and can slip into the global supply chain can succeed on international markets. Peter Chrisp, chief executive, NZTE makes it abundantly clear that government expects greater development of export markets with one focus being on the growing middle class in Asia. And there’s more. We also look at innovations on show at ‘The Cloud’ and Technopak’s brilliant design engineering which puts them up there with the best in the world. And I can’t finish without mentioning Sean O’Sullivan, managing director of Empower Marketing Ltd who has the concerns of all of […]

Despite another dip in expansion, manufacturing activity managed to keep its head above water, according to the latest BNZ – BusinessNZ Performance of Manufacturing Index (PMI). The seasonally adjusted PMI for September was 50.8 (a PMI reading above 50.0 indicates that manufacturing is generally expanding; below 50.0 that it is declining).  This was down from 52.7 in August, along with an average result of 52.7 for the first nine months of 2011. BusinessNZ’s executive director for manufacturing Catherine Beard said that the fourth consecutive slip in expansion was disappointing in terms of building momentum for the sector. “The overall PMI result for September showing minor expansion almost parallels the views by respondents being evenly split in terms of major influences on business activity being positive or negative.  On the negative side of things, comments received tended to focus on a lack of both domestic and offshore orders, while positive comments were spread amongst various influences, with no one issue dominating. “With Xmas soon approaching, it will be interesting to see if the slow slide can be abated with a pick-up in production and new orders.” BNZ economist Doug Steel noted some stiff headwinds that the manufacturing sector has faced over recent times, such as weak domestic construction, a generally strong NZ dollar and concern around world economic growth. “Still, we take some solace from the fact that the PMI remains above the 50 mark, even with the headwinds outlined. And we remain optimistic for manufacturing as some of these headwinds are expected to at least abate or even become tailwinds next year.” Despite another dip in expansion, four of the five seasonally adjusted main diffusion indices were still in expansion during September.  New Orders (51.5) led the way, followed by employment and finished stocks (both at 51.2).  Production (50.8) fell […]

The alliance of seven local councils covering the top half of the North Island and representing over half of all New Zealanders is bold and very welcome, the Employers & Manufacturers Association says. The Upper North Island Strategic Alliance or UNISA just signed is to facilitate collaboration in the north on economic development, transport, tourism, emergency preparedness, ports, waste and water. “The UNISA initiative will facilitate business development by helping align the seven councils’ strategies and objectives,” said Kim Campbell, EMA’s chief executive. “We’ll do everything we can to help make the new initiative a success,” he said. “The Alliance recognises the growing significance of the ‘golden quadrangle’ of the Auckland, Northland, Waikato and Bay of Plenty which EMA has been promoting. “Having all the councils in the north share their plans and aspirations should lead them to share as well their tangible resources and expertise far more. “Its very positive to see our local councils showing leadership in this way. “The initiative stands to help immediately with decision making over cross boundary issues such as the integrated management of the Hauraki Gulf, the Firth of Thames and the Kaipara Harbour, and on such things as transport and building standards,” Mr Campbell said. The UNISA involves Northland Regional Council, Whangarei District Council, Auckland Council, Waikato Regional Council, Bay of Plenty Regional Council, Hamilton City Council and Tauranga City Council.  

  New Zealand tax law’s unfair treatment of intellectual property owners is undermining the Government’s efforts to encourage an innovation economy, according to an intellectual property commercialisation expert. Paul Adams, Chief Executive Officer of intellectual property commercialisation firm EverEdge IP, says the Income Tax Act (2007) taxes patents and patent applications unfairly because it treats them as an asset when they are in someone’s possession, but taxes them as income when sold. “Money spent on patents must be capitalised and therefore treated as an asset, rather than a tax deductable expense. Yet revenue earned from selling patents is considered to be income and taxed at income tax rates. Paul Adams “From a tax perspective, patent owners are getting the worst of both worlds. This approach punishes innovators for developing intellectual property assets.” Mr Adams commented that if Labour introduced an encompassing capital gains tax patent owners would be further penalised. The approach to patent taxation has the potential to undermine the development of New Zealand’s innovation sector because it encourages innovators to locate their intellectual property offshore. Relocating intellectual property offshore is even more compelling when New Zealand’s high tax rate on royalties is taken into account. Other countries, such as Singapore, Belgium, Spain and the Netherlands, are attractive because they have very low tax rates for income derived from intellectual property. Mr Adams is aware of a number of New Zealand businesses that have relocated their intellectual property overseas as a result of our tax regime. “This legislation makes absolutely no sense. R&D tends to base itself where intellectual property is held. With this regime there is no incentive to keep patents in New Zealand. The country ends up missing out on high value job creation, innovation and export revenue.” Further the law is not well understood and many […]

NZIER’s Quarterly Survey of Business Opinion (QSBO) shows steady economic activity in the September 2011 quarter. Firms’ experienced trading activity is broadly unchanged (+2% from +3%) on a seasonally adjusted basis. This is consistent with annual economic growth of around 1.5%. Activity was stable in the September quarter. Retail and services sectors picked up, but manufacturing and construction slowed. Canterbury is rebounding from the earthquake disruption, but the rest of the country is flat. Retailers are expecting a bumper end to 2011, which may be attributable to the Rugby World Cup”. The survey shows a resilient economy heading into the latest phase of global economic uncertainty. However, most of the survey responses were received before the RBNZ’s interest rate announcement, our credit downgrades and the rapid deterioration in global sentiment. Canterbury rebounding from earthquake disruptions Activity is picking up, particularly for retailers and builders. The services sector, which was hit hardest, continues to struggle. Investment intentions have soared in Canterbury, to replace lost capital. Building investment intentions have surged, but they are slowing elsewhere in the country. Firms remain cautious about expanding while demand remains patchy. Contained inflation Easing costs and pricing intentions suggest inflation will be contained over coming quarters. There is emerging inflation in the construction sector, with prices rising for the first time in three years. This may be related to the Canterbury rebuild. Outside of the construction sector, inflationary pressures are subdued. Activity indicators are also flat outside of Canterbury. Heightened global tensions have already affected Australian business confidence, but Kiwi firms are still surprisingly optimistic. The RBNZ is clearly mindful of these risks and the OCR is likely to stay unchanged at 2.5% for some time.