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From Survive to Thrive: FMCG Strategies for Growth and Profitability in 2025

Chris Foord, Partner, Argon & Co New Zealand As we look forward to 2025 the outlook for business and NZ are improving. Many businesses in 2024 were focused on the “survive till 2025” mindset, controlling costs and avoiding discretionary spend. Very few though forgot about the consumer/customer and the need to continue to serve, surprise and delight with excellent product, service and pricing. Most FMCG businesses will be looking to return to better margin positions in 2025 and indications are favourable that this is achievable. The inflation beast has been tamed, so interest rates have fallen and are predicted to drop further (albeit not by a huge amount) through 2025. Business sentiment is on the rebound. Consumer confidence is at its highest level for two years, which in turn improves business confidence. Whilst the signs are positive, navigating from the survival mindset to a thrive mindset doesn’t happen without intent. So, what are some helpful tips to consider as FMCG businesses transition into what should be a period of growth, and importantly how to create value and embed sustainable profitability. Here are some areas to consider and explore: Align operations to execute your business strategy Plan to drive profitable growth Unlock, deliver and celebrate quick wins Create and embed a continuous improvement culture AI: Proof of Value Align operations to execute your business strategy Operations is where the rubber hits the road for your business strategy. Are your operational teams involved in the key decisions as you launch new products, drive innovation, review range, pricing and promotional plans? If not, they should be. They operationalise strategy, plans and tactics into reality. Get them onboard early and you will realise value faster and more effectively. Plan to drive profitable growth Continue your focus on productivity. 2024 taught most to drive efficiency […]

Matter: The Magnificent Illusion -1st Edition

by Guido Tonelli What are we made up of? What holds material bodies together? Is there a difference between terrestrial matter and celestial matter – the matter that makes up the Earth and the matter that makes up the Sun and other stars? When Democritus stated, between the fifth and fourth centuries BCE, that we are made up of atoms, few people believed him. Not until Galileo and Newton in the seventeenth century did people take the idea seriously, and it was another four hundred years before we could reconstruct the elementary components of matter. Everything around us – the matter that forms rocks and planets, flowers and stars, even us – has very particular properties.These properties, which seem quite normal to us, are in fact very special, because the universe, whose evolution began almost fourteen billion years ago, is today a very cold environment. In this book, Guido Tonelli explains how elementary particles, which make up matter, combine into bizarre shapes to form correlated quantum states, primordial soups of quarks and gluons, or massive neutron stars. New questions that have emerged from the most recent research are answered: in what sense is the vacuum a material state? Why can space-time also vibrate and oscillate? Can elementary grains of space and time exist? What forms does matter assume inside large black holes? In clear and lively prose, Tonelli takes readers on an exhilarating journey into the latest discoveries of contemporary science, enabling them to see the universe, and themselves, in a new light.

Book Review: Power Metal

By Vince Beiser Power Metal sounds the alarm on the environmental and social consequences of electronic and digital energy—and how the ways we are combating climate change come at a cost. When we bring our mobile phone to life with a tap or settle in behind the wheel of our car, few of us give much thought to the raw materials required to make these sometimes miraculous- seeming devices work. Journalist Vince Beiser has reflected deeply on that subject, and the result, Power Metal: The Race for the Resources That Will Shape Our Future, is a sharp cautionary tale about the dilemmas facing humanity as we advance deeper into what he calls the Electro-Digital Age, especially as we pursue the essential transition to an energy-renewable future. Everything comes with a cost, Beiser reminds us, even when it comes to the use of so-called critical metals like lithium, cobalt and nickel. These resources are fundamental to the massive expansion of electric cars and the clean energy sources (namely solar and wind power) that are necessary to combat climate change. What makes that truth problematic, he argues, is that the inevitable price of progress often falls most heavily on the residents of impoverished countries who bear the burden of first extracting these materials and later disposing of the batteries and printed circuit boards, for example, in which they’re used. Beiser’s journey to this insight takes him from the streets of his hometown of Vancouver, British Columbia, where he tracks an “urban miner” digging through dumpsters for salvageable products like copper wiring, to a lithium mining operation in Chile’s Atacama desert, to a garbage dump in Lagos, Nigeria, where “e-waste scrappers” work in hazardous conditions to recycle electronic products. Power Metal is a concise, but thoroughly researched, work crammed with eye-popping statistics—among them the fact that […]

Innovation in adversity: Transformative approaches to outsourcing

As the year winds down, businesses across New Zealand reflect on lessons learned and strategise for growth. For some, this year has been transformative, driven by innovative approaches to overcoming industry challenges. Director of Auckland public relations agency Impact PR Mark Devlin, discusses how selective outsourcing can be leveraged to expand capacity and access lucrative export markets. For many SME manufacturers, this is a frenetic time of year. Trying to pack in two months of production and administration along with plans for time with the family in the three weeks before Christmas can be exhausting. The public relations sector is no different. Media continue to churn out content, client crises and issues still arise (frequently when the CEO is at the beach for some reason) and we work with journalists looking for stories they can hold to publish over the summer season when the news cycle tends to quieten. That said, the end of the year is often the only time many of us will get to reflect back on lessons learned and look ahead to better more efficient ways of achieving business growth. Over the past 12 months, I have worked with two businesses in very different sectors that stood out in this regard. Both of these have developed new ways of overcoming the challenges associated with outsourcing to dramatically expand their capacity and develop new export markets. Wool carpet manufacturer Bremworth is a great example of how unanticipated adversity can be turned into an opportunity for growth. In the months following the extensive damage to their Napier facility caused by Cyclone Gabrielle, the company moved to develop a hybrid manufacturing model under which New Zealand wool is sent offshore to be spun into yarn and dyed – before being sent back here to be made into premium wool […]

2024 : We are experiencing the bust, are we prepared for the boom?

Dr Troy Coyle, CEO NZ Heavy Engineering Research Association (HERA) 2024 was a difficult year for construction and therefore manufacturing supply chains supporting it. Our levy, which is legislated under the Heavy Engineering Research Levy Act, 1968, is a reliable indicator of sector activity (at least in the segments that use structural steel, such as multi-storey residential, commercial and bridges). In June this year, we experienced the lowest levy level of any month in more than ten years. Boom and bust cycles are a pattern that is pretty consistent, and which we are not really learning how to avoid (e.g. through planned, transparent and sustainable infrastructure investments). The consequence is that in the bust, which we are certainly in, there is a significant reduction in the employment of our skilled workforce. Then, in the boom, we no longer have the available skilled workforce available to meet demand. They have mostly gone offshore. It would certainly help the sector if there was a bilaterally supported pipeline of national infrastructure projects, with a secured budget allocation, that were consciously timed to ensure stability of construction. Combine a construction bust with an inexplicable proposed “reform” of the Vocational Education System introduced by the Hon Penny Simmonds, Minister for Tertiary Education and Skills in 2024, and things are not looking good for the future of our sector. The link between boom and bust cycles and instability in our vocational education system means that looking ahead (possibly in 2026), construction-related manufacturing could experience an unprecedented skilled labour shortage when the market recovers. Our industry is reliant upon skilled apprentices and concerningly, at the moment, there doesn’t seem to be a lot of Government support for work-based learning appearing within the planned “reform”. For steel, there are also potential concerns with the proposed Building (Overseas Building Products, […]

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 […]

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 […]

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 […]

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