Manufacturing Technology

New Zealand Manufacturing: A Year of Resilience and Transformation in 2024

Adam Sharman CEO LMAC-Group APAC The New Zealand manufacturing sector has navigated a complex landscape in 2024, with significant headwinds such as persistent inflation and increased operational costs, local and global supply chain complexities and global economic uncertainty; factors which led many to adopt the mantra of ‘survive to ‘25’ in order to navigate sales uncertainty and low market and consumer confidence. Whilst these realities are pervasive in the industry, economic indicators suggest a flat-lining of productivity rather than a significant decline and this year’s performance and the macro level is perhaps best understood through a detailed lens of economic indicators and sector-specific metrics. According to Statistics New Zealand’s latest manufacturing sector survey [1], the industry’s overall output experienced a modest growth of 2.3% in the 2023-2024 financial year, following a challenging period of contraction in previous years. This growth, while incremental, signals a gradual recovery and renewed resilience in the sector. Key economic indicators revealed: Manufacturing sector contribution to GDP: 11.5% (up from 10.9% in 2023) Total manufacturing sector revenue: NZ$55.3 billion Productivity growth: 1.8% year-on-year Labour productivity improved by 2.1%, demonstrating increased efficiency through technological adoption Export data from the Ministry of Foreign Affairs and Trade [2] painted a nuanced picture of New Zealand’s manufacturing capabilities: Total manufacturing exports: NZ$29.6 billion Top export sectors: Food and beverage manufacturing: NZ$12.4 billion (42% of manufacturing exports) Machinery and equipment: NZ$5.7 billion Chemical and associated products: NZ$3.9 billion Notably, the food and beverage sector continued to be the main breadwinner for GDP, with dairy-related manufactured products accounting for approximately 25% of total manufacturing exports. The sector saw a 3.5% increase in export value, driven by high-quality processing and global demand for New Zealand’s premium agricultural products. Whilst there is potentially some cause for optimism in these numbers, despite ongoing advancements in […]

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 […]

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 […]

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” […]

Aotearoa’s Industry 4.0 journey

From November issue, NZ Manufacturer magazine (below) Sean Doherty, Product Manager, Callaghan Innovation The advent of Industry 4.0 has been a game-changer for the manufacturing sector and can deliver real returns for New Zealand businesses, through increased efficiency, productivity, and innovation. However, many manufacturers remain hesitant to embrace these technologies. This reluctance often stems from persistent myths that cast doubt on the practicality and benefits of Industry 4.0. Based on Callaghan Innovation’s experience working with New Zealand manufacturers who are on their Industry 4.0 journey, we’re keen to dispel some of these common myths and provide some evidence-based solutions to encourage Kiwi manufacturers to confidently step into the future with Industry 4.0. … Myth 1: Industry 4.0 is only for large manufacturing operations. The Reality: Industry 4.0 is not exclusive to large manufacturers. Small and medium-sized enterprises (SMEs) can also leverage these technologies to enhance their operations. Indeed, as a nation of SMEs, this is where Industry 4.0 technologies arguably have the most potential to boost this country’s productivity and economic output. Companies like Nautech Electronics, Gyro Plastics and Oasis Engineering, are all great examples of SMEs deploying Industry 4.0 technologies to good effect. The key is to start small and scale up. For instance, SMEs can begin by implementing IoT sensors and use data analytics to optimise their existing processes. Retrofitting new hardware systems to older equipment can be a cost-effective way to integrate Industry 4.0 technologies without the need for significant upfront investment in new machinery. Myth 2: Exorbitant costs outweigh the benefits The Reality: While initial investments may seem daunting, the long-term benefits of Industry 4.0 technologies can lead to substantial cost savings and increased efficiency. Several McKinsey and Company case studies show manufacturers gaining a 10-20% increase in efficiency, between 10-15% improvement in quality and […]

South Auckland logistics facility to support future infrastructure projects

A new multimillion dollar green logistics facility in South Auckland will help boost access to steel construction materials needed for New Zealand’s major infrastructure and renewable energy projects. Latest Government data shows more than $120 billion has been forecast to be spent on infrastructure by the Crown, Crown entities and KiwiRail over the next five years.[1] The investment is designed to address New Zealand’s infrastructure deficit and prepare the country for future challenges, including population growth and climate change. Key areas of investment include transport, regional infrastructure, resilience and emergency preparedness, public buildings and schools. Dean Brown, CEO of Asmuss Group, says with over 1,400 infrastructure projects valued at $10 million or more planned in the coming years, improving the construction industry’s supply chain capacity will be critical to the efficient delivery of these projects. He says the new $25 million, 15,400m2 purpose-built logistics facility at Drury South Crossing can store over 12,000 tonnes of steel, around 2.1 times the steel volume used in the Auckland Harbour Bridge. “Most of New Zealand’s structural steel needs are met by overseas suppliers and developing the capability to manage the rapid distribution of large volumes of these materials will help ensure that materials are sourced, transported, and utilised effectively to avoid delays. “The operating model at the new facility has been designed to move high volumes of steel across multiple bays simultaneously, significantly improving operational efficiency and customer service deliveries. “In practice, this could see us unload 1,000 tonnes of steel, around 42 truckloads, from the port in a matter of days. By introducing greater redundancy and reducing any supply chain bottlenecks we can help support the development of New Zealand’s infrastructure in a shorter timeframe,” he says. Brown says seven high-capacity, 32-metre-wide anti-sway gantry cranes can move large quantities of steel safely […]

Mackwell & Co. – Empowering energy sovereignty with advanced steam engines

Mackwell & Co. of Christchurch was established in 2016 by Founder Sam Mackwell. The company’s purpose is to “empower energy sovereignty” with a focus on energy resilience and fossil-fuel-free transport. Mackwell realised the two concepts needed to address this are the use of accessible and low value biomass as fuel, and a technology that can safely and cleanly convert this to useful work without relying on extensive infrastructure. The Mackwell A35 features a unique biomass fired water tube boiler that is compact and responsive enough for use in transport as well fixed shaft power or electricity generation. The A35 traction engine is designed for horticultural and small farm towing up to seven tonnes at 40 km/h, and the same boiler and engine will be produced as a 26kW generator set offering up to 180kW of heat. Once this concept is proven in the market the design will be scaled to 600kW for industrial and marine use. Mackwell & Co. technology has shown to have a number of other applications. Earlier this year Mackwell partnered with Biocare Pty Ltd. to design and manufacture four large combustion chambers for a project in Kangaroo island which is set to be one of the largest biochar projects globally. Discussions are now underway with New Zealand forestry operators to use large steam engines to directly drive equipment such as disc chippers. The A35 has attracted five pre-orders for businesses including portable sawmills and essential oils distillation. Customers can expect more than 35% in overall cost savings where replacing diesel engines, and a 96% reduction in CO2 emissions. Small engines are suitable for manual fueling, and larger applications will require a mechanical feed system to maintain the 2.5kg/kWh input requirement. Mackwell engines are of additional value where heat is needed, such as hydronic […]

Paying a ‘unique’ price: Why it can pay to be the same

-Frank Phillips, Managing Director, Fulcrum The Hook “But we’re unique, no one else takes bespoke orders that morning, processes and ships them that afternoon.” “Not even your competitors?” “Yes, they do….but they are much bigger and can afford to develop systems that are perfect for themselves”. “Is there anyway to test how bespoke these orders really are?” The Problem This conversation, in various guises happens regularly with clients, and sometimes it’s true, but often, we’re not as unique as we think. And that’s a good thing! The more unique we are, or decide to be, in our operations the more expensive our journey to digitisation becomes. This becomes particularly salient against the backdrop of New Zealand’s beating heart of manufacturing SME’s being in the midst of a perpetual battle when it comes to digitisation. Firstly, weighing up the challenging costs of developing digital systems and automated processes that are fit for purpose with realistic return on investment. Whilst secondly, being touted the value of Industry 4 technologies but facing a skills barrier to adoption. The Solution So what advice would I give to any manufacturing business looking to digitisation and automation be? It’s simple. Start thinking about your internal operations differently. Or paradoxically, not different at all. Whilst there is widespread appreciation for needing a clear competitive advantage, that thing or things that set you apart and make you unique. Extending this thinking to everything about your business can hamper digital progress, driving you to look for or build bespoke solutions that match your processes perfectly. Where competitive advantage should be ‘up in lights’ externally. Internally we should be asking ourselves the question ‘how can we make this process as similar as possible to other operations’. This is for two reasons: It’s cheaper to borrow than build. If that’s the […]

Navigating the manufacturing technology landscape: MES vs MDH vs MMP

Adam Sharman, CEO LMAC Group, APAC As manufacturing organisations strive to optimise their operations, the adoption of technology has always been a key focus. In the last 10 years, developments in digital technologies for manufacturers have increased pace and, whilst most organisations recognise the opportunity presented by these developments, the rapidly changing ecosystem of systems can make it difficult to identify the best fit for the business. The landscape of manufacturing or operational management systems has evolved considerably in recent years, with multiple options available to fit the needs of the business based on scale, complexity and requirements. Three solutions that have gained significant traction are Manufacturing Execution Systems (MES), Manufacturing Data Hubs (MDH), and Machine Monitoring Platforms (MMP). Each offers unique benefits and comes with its own set of limitations. This article aims to provide a comprehensive comparison to help manufacturers make informed decisions on which of these solutions is the best fit when considering investment in OT software. Manufacturing Execution Systems (MES) MES is a comprehensive software solution that manages and monitors work-in-process on the factory floor. It operates in real time to enable the control of multiple elements of the production process, including: – Resource allocation and status – Production scheduling – Dispatching production units – Quality management – Labor and material tracking – Performance analysis MES serves as a bridge between planning systems like ERP (Enterprise Resource Planning) and the actual production processes, providing a holistic view of how current conditions on the plant floor can be optimised to improve production output. Benefits Comprehensive Production Management: MES provides end-to-end visibility and control over production processes, from order release to finished goods. Real-time Decision Making: Offers real-time data and analytics, enabling quick responses to production issues. Quality Control: Integrates quality management processes, reducing defects and improving overall […]

Digital Factory Accelerator: Driving Northern Ireland’s Manufacturing into the Future

From: August issue NZ Manufacturer www.nzmanufacturer.co.nz -Adam Sharman, Senior Partner, Dsifer As New Zealand’s manufacturing industry continues to evolve in the face of global challenges, it’s crucial to look beyond our shores for inspiration and insights. In this article, we review the approach taken in Northern Ireland, where a pioneering initiative is reshaping the manufacturing landscape. This case study offers valuable lessons for New Zealand manufacturers seeking to navigate the complexities of digital transformation and Industry 4.0. In an ambitious move to boost the competitiveness of Northern Ireland’s manufacturing sector, a groundbreaking initiative called the Digital Factory Accelerator (DFA) has recently concluded its pilot phase. This innovative program, spearheaded by the Advanced Manufacturing Innovation Centre (AMIC) and Invest Northern Ireland in partnership with the High Value Manufacturing Catapult (HVMC) and LMAC Group, aims to accelerate the adoption of Industry 4.0 technologies across the region’s diverse manufacturing landscape. The DFA pilot, which wrapped up in June 2024, involved 32 companies ranging from small enterprises to large multinationals. Using the internationally recognised Smart Industry Readiness Index (SIRI) assessment tool, the program provided participating companies with a comprehensive evaluation of their digital maturity and a roadmap for future transformation. One of the differentiators of SIRI is the ability to benchmark globally based on company size, and by sector. The DFA pilot used the XIRI analytics platform provided by INCIT to develop meaningful insights that are crucial in shaping strategies for manufacturing within regions. Key findings from the pilot revealed that Northern Ireland’s manufacturing sector, while producing world-class products and services, lags behind international benchmarks in terms of digital adoption. The average SIRI score for UK manufacturing companies was 1.12, significantly lower than the peer group average of 1.84 (on a scale of 0-5). This gap highlights both the challenges and opportunities facing the […]

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