Business News

A year to reflect and renew

From NZ Manufacturer magazine, December 2024. By EMA Head of Advanced Manufacturing, Jane Finlayson There’s no doubt that 2024 has been another challenging year for New Zealand’s manufacturing sector. Global uncertainties, local economic pressures, and significant supply chain disruptions have tested manufacturers across the country. Yet, despite these obstacles, the resilience, adaptability, and determination of our manufacturing community have shone through. However, the year also showed how much work remains to be done to turn the sector around and get productivity back on track. The latest BNZ-BusinessNZ Performance of Manufacturing Index (PMI) for November 2024 showed the 21st consecutive month of contraction for the sector, underscoring the ongoing pressures faced by many manufacturers. While some encouraging signs were visible midway through the year, with what looked like a gradual return towards the neutral 50.0 mark, October and November decreases highlighted the fragility of the recovery. The key sub-indices, such as production, employment and deliveries all registered below the neutral mark, with production activity in particular falling to its lowest point since July 2024. The general economic slowdown continues to weigh heavily on the sector, with many manufacturers grappling with high costs, reduced domestic demand, and external pressures such as the ongoing fallout from global inflationary trends and trade disruptions. These numbers don’t tell the full story. Beneath the surface, there’s a lot of good work happening. Many of you have been upskilling your teams, adopting new technologies, and finding smarter ways to operate. These efforts are setting the groundwork for a sector that’s not only resilient but ready to thrive when markets ease and new free trade agreements start to deliver better trading opportunities for some of our goods. Investing in People and Skills One area that stood out this year is the investment being made in people and their […]

Editorial NZ Manufacturer December issue: Challenges and success hand in hand in 2024

In a year that has brought its challenges, there are success stories of businesses striving and finding new opportunities and markets. And we also have a balancing act, one where we retain staff or see them leave for overseas in their quest to try something different. It has been a year of central government keeping the treasure chest closed and seeing restraint as the best way forward (for now). Let us hope that the Minister for Manufacturing, Andrew Bayly, can, at some stage, soon, be allocated some funding to benefit our manufacturing industries. In this issue we include our annual Year in Review and Innovations 2024 to reflect on where we have been and where we are going to. On Page 1, Ian Walsh from Argon and Co, describes this year as “The year to survive”, with businesses focused on managing costs, avoiding unnecessary spending and looking to how they can improve their productivity to improve returns. In 2025, Ian wants to see an increased adoption of lean techniques and tools, AI and automation tools and a unified approach to leadership and team capability. Adam Sharman, LMAC, (Page 14) believes the New Zealand manufacturing sector has navigated a complex landscape this year, a flat-lining of productivity rather than a significant decline. The industry experienced 2.3% modest growth in 2023-24 which indicates a gradual recovery and renewed resilience. David O’Connor of The Learning Wave, (Page 15) believes there is a sense of optimism and energy for our manufacturing businesses. Dr Troy Coyle, CEO, HERA (Page 15) would like to see a bilaterally supported pipeline of national infrastructure projects, with a secured budget allocation, consciously timed to ensure stability of construction. On Page 16, Director of Auckland public relations agency Impact PR, Mark Devlin, discusses how selective outsourcing can be leveraged to […]

What will 2025 bring? Ian Walsh, Partner, Argon & Co NZ

From December NZ Manufacturer magazine, The Year in Review If 2024 was the year of “survive to 25”, what will 2025 bring? Many businesses this year were very focused on managing cost, avoiding unnecessary spending and looking to how they can improve their productivity to improve returns. Of course, many of the traditional levers had already been pulled, so many businesses did not have a lot of fat to start with, so cost reduction did not offer a lot of opportunity. The need to avoid borrowing (due to interest rates), precluded a lot of capital options either new kit, or technology meaning many have relooked at productivity. The reality is many don’t know where to start, because they are unable to see how you could get more from the current team, given everybody is already working so hard. However, this is exactly what must happen, the reality is NZ has been lagging the world in the adoption of best practices, improvement techniques, workforce development for over 40 years. We now have a burning platform! So, my hope for 2025 is: We see an increased adoption of lean techniques and tools and a genuine interest to properly adopt these tools across all sectors of industry. These are proven globally for over 60 years; the key is the right sponsorship and the right sherpa. As business starts to recover, we see adoption of AI/automation tools to support item 1 above. The tools are not a solution in themselves but help build capability and can supercharge the productivity journey. The SIRI assessments supported by government have been helpful in getting business started on this journey, let’s hope this continues next year. A unified approach to leadership and team capability development, with Te Pukenga, NZQA and other parties becoming aligned in the need to […]

Report: China & New Zealand National Brands Forum

Held in November during the China International Import Expo in which New Zealand was the guest of honor. The forum was co-hosted by the NEXT Federation and the New Zealand Business Roundtable in China, with co-organisation by the China Chamber of Commerce of I/E Foodstuffs, Native Products and Animal By-Products, and Tus-Holdings. Fonterra and Taishan City served as principal partners, while strategic cooperation was provided by Dong Jiu, NZ Fos+, Heng Yuan Xiang, and Yudu Junyao. The forum received support from International Business Daily, under the Ministry of Commerce of China. With the theme “Conquering New Heights”, the forum convened senior executives from leading New Zealand enterprises operating in China, top experts in international relations and industrial collaboration, and prominent brand representatives from both nations. The event aimed to strengthen bilateral cooperation in trade, industrial investment, and brand development, while exploring New Practices, New Trends, and New Dynamics in China-New Zealand collaboration. Professor Wang Yong, from the Department of International Political Economy at Peking University, provided insights into the impact of U.S.-China relations on the global economy and examined the potential for enhanced China-New Zealand collaboration. He observed that the United States is entering a conservative era characterised by an “America First” doctrine, marked by intensified political polarization, protectionist policies, and a growing tendency toward unilateralism that undermines international cooperation. These shifts, he noted, are underpinned by deepening wealth inequality and other systemic challenges. David Mahon, Managing Director and Chief Investment Officer of Mahon China Investment Management Ltd., drew on his more than 30 years of experience in fostering China-New Zealand cooperation to share his insights. He emphasised the significant potential for collaboration in areas such as investment, trade, and innovation, even in the face of the challenges posed by globalization. The forum also attracted the participation of relevant government […]

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 […]

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