Regional Manufacturing

Investing for growth

The Budget’s Investment Boost is a tax incentive for businesses to invest in productive assets such as machinery, tools and equipment. This means business can deduct 20 per cent of a new asset’s value from that year’s taxable income, on top of normal depreciation. Because the cashflow from investment improves, more investment opportunities become financially viable and therefore more take place. Business investment can raise the productivity of workers, lifts incomes and drive long-term economic growth. However, businesses, following this path, need some predictability. That a reasonable investment will bring about a return. That their equipment purchases will help their businesses grow. I take it that by increasing the stock of capital in New Zealand, Investment Boost is expected to lift GDP by 1 per cent per year and wages by 1.5 per cent per year over the next twenty years, with half these gains in the next five years. Investment Boost makes New Zealand a more attractive place to invest. It gives businesses facing global uncertainty a reason to keep investing in themselves and in the future of New Zealand. It seems that large-scale businesses with established markets can continue to build their markets. There is also Invest New Zealand to encourage investment in infrastructure. This would be a welcome change from investment in property …let’s keep making and growing things!

Is your value network world class?

Over the last 40 years I have seen significant change in how manufacturing businesses compete. We have moved through the quality revolution which brought new expectations around quality and cost, to the lean revolution and associated methodologies delivering better service, value and reduced costs. Businesses then shifted their focusses onto supply chain optimisation, bringing end-to-end thinking. Their approaches moved from comparing their business models with their competitors’, to comparing their supply chains. Top performing supply chains became enabled by ERPs, and are now enabled by value networks, no longer in point-to-point structures but integrated webs of suppliers and partners delivering products and services seamlessly through a multitude of channels. Of course, the rapidly increasing deployment of AI further fuels optimisation and connectedness in these supply chains. At the root of this change in manufacturing are constantly moving market-led goalposts for how businesses better deliver what the end customer wants, when they want it, at the lowest cost possible. Understanding this value equation and then aligning their service delivery model to meet and exceed this expectation better than competition is what separates the wheat from the chaff, and industry leaders are doing this at the most competitive cost to maximise their margins. Very few, if any, businesses can do all of this by themselves. Generally, larger businesses with more scale, buying power, and connections have more capability than SMEs. However, interconnected SMEs can create highly efficient clusters which can compete with anyone and be highly agile and scalable. As we know NZ has a high proportion of SMEs and this presents both an opportunity and a risk. The opportunity is that we can create high-value clusters and that can be highly agile, integrated and capable of delivering high-value products and services through multiple channels to customers around the world. We certainly […]

World-class technology and outstanding culture at Architectural Glass Products

Architectural Glass Products (AGP) is a cutting-edge glass manufacturing business based in Hautapu, near Cambridge. Established five years ago, AGP was created to help provide the APL window manufacturer network with a total window solution. It was born from the belief that the local window and glass industry was being underserved, particularly in terms of service and quality. In response, David Bunting, Mitch Plaw, Craig Vincent and Brent Martin joined forces to create a world-class, fully digitalised, and highly automated double-glazing operation. The result is a custom-built, state-of-the-art facility stretching 417 metres long and 108 metres wide, home to some of the most advanced glass processing equipment in the Southern Hemisphere. The Employers and Manufacturers Association’s Nicholas Russell sat down with David to discuss the challenges and successes of launching a greenfield manufacturing operation in New Zealand, the pivotal role of digital transformation, and the importance of investing in people and culture from day one. Why was AGP started?? We felt the glass and window industry in New Zealand was underserved – quality was lacking, and service wasn’t up to par. Our customers, being APL Window Manufacturers, were feeling the pain and we realised the only way to truly improve the supply chain experience was to control it ourselves. That meant starting from scratch and building a manufacturing business that could deliver exceptional products with equally exceptional service. AGP is known for its massive and innovative facility. Can you tell us about the design thinking behind it? We designed the building around the manufacturing process, not the other way around. That gave us complete freedom to optimise product flow and efficiency. The building is 417 metres long (you could park five Boeing 777s inside with room to spare) and 108 metres wide, which helped us futureproof our operations. Aesthetically, it looks […]

At the coalface of technology adoption in manufacturing

By Jane Finlayson, Head of Advanced Manufacturing, EMA As the backbone of New Zealand’s economy our manufacturing sector contributes approximately 10% to GDP and employs more than over 240,000 people. Yet, despite its significance, the sector’s productivity has been stagnating, with labour productivity growing at a mere 0.92% annually over the past decade, well below the national average of 1.17%. This stagnation is not due to a lack of effort or ambition. Instead, it reflects a critical gap: the sector’s slow and fragmented adoption of technology. While many larger firms are beginning to modernise their operations, many small and medium-sized enterprises (SMEs) still rely on outdated systems, manual processes, and fragmented workflows. This digital inertia is limiting their global competitiveness and resilience. At the Employers and Manufacturers Association (EMA), we see firsthand how these challenges play out. Through our series ‘ASB Manufacturers Workshop: The Impact of Industry 4.0 on Your Business’, manufacturers consistently share a mix of enthusiasm and uncertainty about the path forward. While many are eager to innovate, they often feel overwhelmed by the scope of change and unclear about where to start. One of the most urgent barriers is the widening digital skills gap. In PwC’s 27th Annual CEO Survey, released last year, 83% of local business leaders report they have a skills shortage within their organisation and 76% specify a lack of technical capabilities as a barrier to transformation. This disconnect is deeply concerning, especially as technologies such as artificial intelligence (AI), collaborative robotics (cobots), the Internet of Things (IoT), and data analytics have moved from being future ambitions to current necessities. Feedback from manufacturers who have attended the workshops confirms this. There is growing demand for reskilling workers not only in technical areas, such as integrating Enterprise Resource Planning (ERP) with design tools, managing Supervisory […]

Reflections from Australian Manufacturing Week, looking forward to SouthMACH 2025

Adam Sharnan, CEO LMAC Group APAC Australian Manufacturing Week is an annual exhibition for the manufacturing industry, this year held in Melbourne between 6-9th May. Over the four days of the exhibition, the manufacturing industry comes together to share emerging technologies and services, share learnings and ideas and connect with partners across the industry. With this year’s event taking place within days of the Federal election and the Labour Party’s return to power, the focus of the event was on lifting productivity of Australia’s manufacturing sector and, in turn, its contribution to lifting national GDP. Not unlike, New Zealand’s manufacturing sector, Australian businesses are facing significant challenges. Louise McGrath, Head of Industry Development and Policy at the Australian Industry Group highlighted slowing investment, a restrictive workplace relations system, an uncompetitive tax system, a complex regulatory environment, ongoing skilled labour shortages, and uncertainty over energy affordability and reliability (gas prices having risen by 49% in the last 5 years, contributing to an increase of 31% across all manufacturing inputs) as being the key headwinds facing Australian Manufacturers. These issues are compounded by volatile international conditions and national security challenges, severely constraining the capacity and confidence to invest in business R&D, which is critical for innovation and productivity enhancement. In response to these challenges, industry groups used the Australian Manufacturing Week exhibition to advocate for an industry-wide approach to lifting productivity and viability of the manufacturing industry focused on Digitisation (acceleration of productivity through the adoption of Industry 4.0 technology), Diversification (in to new and growing markets such as defence and hydrogen production) and Decarbonisation (to reduce reliance on high-cost energy inputs). Prior to their election, the Albanese government outlined a federal industry support package focus around the National Reconstruction Fund (allocating $1 billion of its $15 billion budget to novel and […]

Hutt Valley’s focus on manufacturing’s future

Just released is strategic report 35 BY 35, the ten-year roadmap for Hutt Valley business growth, with a strong focus on manufacturing. The ambitious 10-year plan is to grow the Hutt Valley’s GDP by 35%, increase productivity by 16%, and increase highly skilled jobs by 18% – putting our region at the heart of New Zealand’s manufacturing, research, science and innovation industries; delivering business and community prosperity. There are over 15,000 businesses in the Hutt Valley contributing $10 billion to the New Zealand economy and employing more than 70,000 people. In the picture:Patrick McKibbin, Chief Executive, The Hutt Valley Chamber of Commerce. The plan wants to see: Productivity increase by 18.3% Increase highly skilled jobs by 16.5% GDP increase by 35% Higher average wages More jobs Greater wellbeing Better infrastructure Based on the past five years’ performance alone, linear growth for Hutt Valley is predicted at 30.7% by 2035 (44.1% in Upper Hutt and 26.4% in Lower Hutt). The ambition is to exceed linear growth. Higher productivity than the national average In the financial year to March 2022, the Hutt Valley exhibited a robust productivity level, with GDP per filled job amounting to $138,345. This figure surpassed the national average of $132,815, indicating the region’s higher productivity levels. Productivity growth Productivity in the Hutt Valley in March 2022 demonstrated steady growth, increasing by 2.8% compared to the previous year, outpacing the national increase of 2.3%. This growth trend is indicative of a region that values efficiency and innovation. The Hutt Valley is the engine room of the Wellington region – a vibrant hub of manufacturing, innovation, science and research, and many outstanding support businesses, which together form the thriving business community that we take immense pride in. The region has existing and future plans to invest significantly in construction […]

Navigating the tariff maze: How NZ manufacturers can thrive amid trade tensions

Adam Sharman, CEO LMAC Group APAC Tariff turbulence: Understanding the impact on kiwi manufacturers. As trade tensions escalate globally, through the introduction of heavy tariff from the U.S. New Zealand manufacturers find themselves navigating increasingly complex waters. The United States is one of New Zealand’s key export markets worth approximately NZ$9 billion annually, and New Zealand products provide key components in other countries’ supply chains into the USA. The ripple effects of U.S. tariff changes extend far beyond simple price adjustments. When tariffs increase, manufacturers face immediate margin pressure, but also longer-term strategic questions about market positioning and investment priorities. For New Zealand’s primary sector, dairy processors, which have developed specialised ingredients for U.S. food manufacturers, tariff increases could undermine carefully cultivated market positions. Similarly, premium meat exporters who have invested heavily in sustainability certifications and farm-to-table traceability to command premium pricing, could see their value propositions challenged. The impact extends beyond agricultural processing. New Zealand’s high-tech manufacturing sector, including medical device manufacturers and precision agricultural equipment producers, faces similar challenges. For organisations that have established niches in specialised global supply chains where even modest tariff increases could significantly alter competitive dynamics, a focus on IP protection and maintaining certifications required for market access, for example in aerospace, pharmaceuticals and defence help protect market position, and reduce price sensitivity. Strategic pivot: Capitalising on trade war opportunities While tariff increases present challenges, they also create strategic opportunities. As tensions escalate between the United States and other major trading blocs, particularly Europe and China, New Zealand manufacturers could benefit from “tariff arbitrage” – situations where Kiwi products become relatively more competitive due to higher tariffs on competitor nations. Exporting organisations are required to think differently about their global market positioning, both in terms of direct market tariffs and the relative position […]

The Skills Shortage Smokescreen

Stop searching for unicorns. Build a workplace worth joining and staying at. “We just can’t find the right people.” It’s the go-to excuse for operational issues, stalled growth and missed deadlines. But let’s call it what it is: a smokescreen. The so-called “skills shortage” is a convenient distraction from a harder truth. For many businesses, they don’t have a people problem, it’s a management problem. David Altana is head of growth and partnership at Smartspace.ai and co-host and founder of The Better SMB Podcast. When we dig beneath the surface, the reality is clearer than we’d like to admit. If your business can’t attract or retain good people, it’s probably not the labour market letting you down. It’s likely something internal: your culture, your systems, or your leadership. You Get What You Build For According to MBIE[1], 40% of roles in Tamaki Makaurau are classed as low-skilled, so let’s contrast a couple of businesses in the same region, competing to attract the same workers. One constantly complains about a lack of skilled staff. The other quietly gets on with hiring, training and growing its team. The difference isn’t luck. It’s leadership. Rob Bull is Director and principal consultant at Plexus Consultant and co-founder and host of The Better SMB Podcast. The successful business has designed itself to be a place people want to stay. It invests in onboarding, creates meaningful development pathways, and builds an environment where team members feel valued. Managers know their people. They communicate. They coach. They share the “why” behind the work. These companies don’t have a secret recruitment strategy, they simply understand retention starts with trust, which is built through day-to-day leadership, not policies or perks. To get an idea of what this looks like in practice, it’s worth reading the Jones & Sandford Joinery […]

Manufacturing fuels the present – SouthMACH 2025 is on soon

From NZ Manufacturer magazine, April 2025 -Doug Green, Publisher Fisher and Paykel Healthcare, Gallagher Industries, Buckley Systems, Rocket Lab, Rakon, Skellerup Holdings, Particle Systems, Scott Technology…are just a few examples of successful companies who have found markets for their ‘home grown’ products and services. And they keep moving ahead in challenging times. www.smartmanufacturingtoday.com They are members of the Creative Class – to which so many of us belong – who help drive the economy. They are the people who role their sleeves up and get stuck in, in their workshops or studios, to make ‘the next best thing’ and find new markets for their unique products. At present, it is not only tariffs we need to keep an eye on, Generative AI (GenAI) is set to reshape manufacturing, driving innovative integration, operational efficiency, and data insights, transforming productivity and revenue. Distribution leaders will need to adopt AI, robotics, and IoT to enhance industry-specific processes, data, and ways of working. Ian Walsh, Partner, Argon and Co is big on Lean. And others don’t just talk Industry 4.0, they also talk Industry 5.0 These are all required for the efficiency of manufacturing. And of course, there is the urgent need to raise the levels of Productivity. This cant just be a never-ending conversation piece – we need to do something about it! Manufacturers will have to be prepared for the continued rise in competition from lower-cost production countries in Asia, including Vietnam, Thailand and China, along with more technologically advanced nations in Europe. The world and its markets are changing and our manufacturers need to adapt and move forward. Research the TIN Network, or the EMA, HERA, the Hutt Valley Chamber of Commerce, the Southland Business Chamber, Make NZ or the Northland Chamber of Commerce. Join, find out what is going on […]

Talk fests do not help the bottom line

Editorial NZ Manufacturer February 2025 We are not short of commentators in New Zealand telling us what is wrong. Some even prefer ideas on how we can fix things. These commentators appear in our newspapers and whatever they say – does it matter? – does not bring about change. They do not affect policy. They keep their Profile and allowance – the newspapers keep their commentators as added value for the paper they write for, seemingly to satisfy the subscriber. If they believe they can make a difference to our way of life, they need to talk less about (say) real estate, where so much money is invested that does not go into the productive sector. People buying up property are, generally, not the creative class, innovators, developers, forward- thinking in their view on the nation’s future. This is where a cloud hangs over our prime minister; he owns properties and whatever he says for the direction the country does not affect his back pocket. He is in a regal position where decisions made will not lessen his financial situation. We have Chris Plenk, the new Minister for Small Business and Manufacturing who does not have a budget, A minister outside cabinet who answers to Judith Collins. We have the disassembling of Callaghan Innovation and its functions moved to other entities. We need to come to grips with where the country is heading and how we are going to get there. Is it more overseas investment, hopefully in businesses and not real estate. Is it public sector and private sector investment – and what will the investment focus on? We continually discuss the rail, road and sea transport systems as to help make the economy stronger. But just what is around the corner? We know agriculture and land-based enterprises continue […]

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Regional Manufacturing