The Creative Class

Kiwi exporters can plan and adapt now we have some tariff certainty

By EMA Head of Membership & Export Simon Devoy New Zealand exporters were dealt a tough blow at the start of August as the United States confirmed an unexpected increase in tariffs on our goods, from a widely predicted 10% to 15%. It appeared the New Zealand government and our trade negotiators had been working on the assumption that the rate would be held at 10%, but that understanding evaporated with a decision made directly by President Donald Trump. The shift reflects Washington’s new trade-first, numbers-driven approach, which leaves little room for nuance or negotiation. In this worldview, a trade surplus equals punishment, and despite New Zealand’s relatively modest NZ$500 million surplus with the US, we found ourselves in the higher tariff bracket while competitors such as Australia and Chile remained at 10% thanks to deficits in recent months. Minister for Trade and Investment Todd McClay, accompanied by New Zealand’s top trade negotiator Vangelis Vitalis, is in Washington to press the case for a reversal. They are there to register concern, seek an explanation for the extra 5%, highlight the strain this places on New Zealand–US relations, and explore a path back to a lower rate. However, the message from the US side has been blunt: the Trump administration believes America has been “ripped off” in past trade arrangements and is determined to redress what it sees as imbalances. For New Zealand, the reality is we have limited leverage. One example of an avenue we could go down is strategic procurement, such as directing some of our planned defence upgrades towards US manufacturers to help offset the surplus. While not a quick fix, such moves could be part of a wider diplomatic and economic strategy. Despite the blow, the latest announcement at least brings certainty after months of speculation and […]

New Zealand is poor because it chooses to be

-Sean Doherty Sir Paul Callaghan famously declared: “New Zealand is poor because it chooses to be.” Nearly 15 years on, with the decision to dissolve Callaghan Innovation the agency bearing his name, these words ring truer than ever in 2025. At this turning point, New Zealand must decide: Will we finally address the innovation deficit by embracing high-value manufacturing, or continue on a path of slow, incremental change? The productivity trap New Zealanders are admired for their work ethic and creativity. Yet, the nation continues to lag behind its global peers in productivity and prosperity. The key reason? An overreliance on low-value, commodity-driven industries rather than advancing technology-rich, high-value sectors. Despite technological progress worldwide, New Zealand’s per-capita prosperity growth has not matched high-value, knowledge-led economies over the past two decades. International comparisons Israel, Singapore, and Ireland are cited as examples of nations that have transformed through purposeful investment in advanced research, tech-enabled manufacturing, and robust support for innovation and entrepreneurship. These countries consistently invest in science, technology, and high-value manufacturing, creating dynamic economies with sustained prosperity. The power of innovation Sir Paul Callaghan stressed that true prosperity can only be achieved by focusing national efforts on innovation-intensive sectors. Efforts to “pick winners” in areas like biotech, agritech, and clean tech have delivered mixed results, highlighting that the most transformative advances come from empowering New Zealanders to innovatively solve challenges and seize opportunities—often in surprising, unscripted ways. “Prosperity doesn’t grow from following the script of what other Governments are doing; it emerges from innovators taking risks and building new niches.” Time for a new roadmap The closure of Callaghan Innovation and changes to science agencies will achieve little unless policy, business, and scientific leadership rally behind a new, bolder strategy. This pivotal moment calls for action: Backing High-Tech manufacturing Shift from […]

How an elite athlete system could unlock new levels of productivity in NZ manufacturing

-Mark Devlin, Impact PR New Zealand’s manufacturers have long punched above their weight. Despite our relatively small domestic market and geographic isolation, Kiwi businesses have found ways to innovate, adapt, and produce world-class products. But there’s one area where we continue to fall behind global benchmarks, and that is workforce productivity. In a sector where efficiency, speed, and output are constantly under pressure, how we support and develop human performance should be central to every productivity conversation. Yet all too often, manufacturers focus their investment on new machinery, process automation, or software upgrades, while overlooking the untapped potential within their people. That is why a new system, originally designed to help elite athletes deliver peak performances under pressure, could represent a game-changing opportunity for our industry. Vantaset, a New Zealand-based performance company, has developed a science-backed workplace platform that helps individuals and teams consistently deliver their best. It was created by Craig Steel, a performance expert whose research into the psychological breaking point of athletes led to a repeatable framework now used in both public and private sector organisations. This is not a motivational workshop or a leadership seminar. It is a codified, platform-based performance system grounded in decades of data and testing. Developed by a team that includes a former All Blacks manager and two Olympians, the Vantaset framework was originally designed to help elite athletes deliver peak performance on demand. It has since been refined into a platform-as-a-service (PaaS) model that organisations can implement across their entire workforce. What makes this particularly relevant for manufacturers is the platform’s focus on helping people function effectively in high-pressure environments. Unlike many workplace performance tools that are reactive-used to manage poor results or resolve personnel issues-Vantaset’s system is designed to proactively lift output and engagement. This approach is especially powerful for […]

Kiwi garage start up one of largest dual market export operations

Set for $115m expansion in China A Kiwi company that began as a West Auckland garage start-up nearly three decades ago has grown into one of NZ’s largest dual-market export operations, and is set for further expansion with the construction of a new $115m biotech manufacturing facility in China underway. Manukau-based Alpha Group is a vertically integrated nutraceutical exporter at the international forefront of fermentation technologies. The company produces patented fungal and plant-based bioactives, with integrated research and manufacturing operations across New Zealand and China. The new 60,000m² facility in Ningde will support New Zealand’s fermentation export capabilities by integrating advanced R&D, testing, treatment and production. Once complete, it is expected to generate more than NZ$225 million in annual revenue and expand Alpha’s transnational footprint to over 119 hectares. To date, the company has invested over NZ$830 million in developing this global infrastructure. Alpha Group was founded in New Lynn in 1998 by Professor Yihuai Gao, a globally recognised researcher in medicinal fungi and honorary fellow at Massey University’s Riddet Institute. Mike Arand, Alpha Group senior business advisor, says the new facility is the physical realisation of Alpha’s long-term dual-market strategy, which combines New Zealand’s scientific and natural resource strengths with China’s demand, scale and infrastructure. He says the development bridges lab-to-market pathways, turning New Zealand-led research into commercial outcomes that drive export growth and reinvestment into local R&D. “This facility unlocks exponential growth potential for New Zealand’s fermentation sector. “By integrating R&D and processing in one hub close to our largest export market, we can boost output, reduce lead times and increase demand for Kiwi-derived ingredients. “It’s about creating a transnational innovation ecosystem where New Zealand science drives offshore commercial outcomes, which then feed back into local jobs, R&D and raw material demand,” he says. Alpha Group has already […]

Carbon claims: Get the language right and the facts straight

-thinkstep-anz If you’re sharing your organisation’s carbon footprint, net zero goals or carbon neutral status, it’s vital to communicate clearly and accurately. Getting it wrong could damage your reputation, open you up to legal risk or erode trust with your customers and stakeholders. Strong carbon claims can show leadership, but only if they’re backed by real action and solid evidence. The good news is: once you understand the terms, it’s much easier to get them right. Why clarity matters more than ever In today’s fast-moving policy and regulatory environment, environmental claims are under increasing scrutiny. We’ve seen businesses taken to court for inaccurate or unsubstantiated claims. To stay on the right side of the law – and the right side of your customers – you need to be cautious and well-informed. This article explains the key carbon terms and offers practical advice to help manufacturers communicate responsibly. What the key carbon terms mean Carbon neutral Your business, product or service has measured its emissions, taken action to reduce them and used offsets to balance what’s left. You need: a defined scope (e.g. your head office or a specific product line), a timeframe, a verified carbon footprint and a credible reduction plan. Use offsets only for emissions you genuinely can’t avoid, after reduction efforts. Standard to follow: ISO 14068. Example: A manufacturer measures and verifies its emissions for 2023, reduces what it can and offsets the rest using certified carbon credits. It communicates: “Carbon neutral for our Christchurch site in 2023, certified to ISO 14068.” Net carbon zero This means deep emissions cuts first, and offsets only for what’s unavoidable. It’s typically applied to entire organisations. You need: to follow the Science Based Targets initiative (SBTi) approach – prioritising genuine emissions reductions. Offsetting alone is not enough. You must reduce most […]

Building the Foundation: Preparing Your Manufacturing Business for AI Success

-Adam Sharman, CEO LMAC Group APAC The manufacturing sector stands at the precipice of an AI revolution that promises to transform everything from production efficiency to supply chain management. Yet for many business leaders, the question isn’t whether to adopt AI, but how to prepare their organisations to extract maximum value from these powerful technologies. The answer lies not in the sophistication of the AI itself, but in the quality of the foundation upon which it’s built. The Data Foundation Imperative Before any AI system can deliver meaningful insights, your manufacturing operation must first establish a robust data infrastructure. This begins with conducting a comprehensive audit of your existing data landscape. Map out where data is generated across your operation—from sensor readings on the factory floor to inventory management systems, quality control metrics, and customer order patterns. Many manufacturers discover they’re sitting on vast amounts of valuable data that remains siloed across different departments and systems. The key is achieving data integration and standardisation. Legacy systems often speak different languages, storing similar information in incompatible formats. A machine’s operational data might be recorded in one system while maintenance records exist in another, making it impossible for AI to identify patterns between equipment performance and maintenance needs. Investing in data integration platforms that can unify these disparate sources creates the coherent dataset that AI algorithms require to function effectively. Data quality represents another critical pillar. AI systems amplify the characteristics of the data they’re trained on—if your data contains errors, inconsistencies, or gaps, your AI will perpetuate and magnify these problems. Implement rigorous data validation processes, establish clear data governance protocols, and create systems for continuous data quality monitoring. This might involve automated checks for outliers, regular audits of data entry processes, and establishing clear accountability for data accuracy across teams. […]

Blending artistry with automation for strategic advantage

-Scott Adams, Argon & Co Manufacturing companies in New Zealand are most often owned, managed, and operated by engineers and therefore they often lack artistry, passion, and flair. I readily, and happily, accept there are exceptions to this statement, but for every exception there are 10 more that focus on precision, performance, and cost. Is this a problem? Sometimes it is, because we miss the opportunity of producing something wonderful rather than something utilitarian, but also because it limits opportunity and commercial outcomes. If we build a low-cost focused, and therefore often automated, manufacturing capability without creativity then it is very difficult to be innovative with product design and it therefore limits our ability to adapt to a changing market or to create opportunity in a new market. I frequently hear that the only reason a product has changed is because the client required it. This is satisfactory for many of our smaller national or regionally focused manufacturing companies as there are significant obstacles to change: there is not enough space, inflexible machinery, or people are scared to try something different. But if we were to examine a list of the NZ manufacturing companies that have been successful globally and nationally, it would be full of companies that have blended artistry with automation, admittedly in industry sectors where that combination is encouraged, which is generally high-value niche products. Another smaller list of successful companies will show they have primarily focused on the artistry. However, we have very few low-cost automation manufacturing companies producing volume that have been successful, primarily because there are too many barriers to be globally, let alone nationally, successful due to our small population and high labour costs. So, if there are benefits in blending automation with artistry then what steps would I take? I’d argue that […]

Adoption of smart practises by manufacturers across New Zealand

New Zealand’s manufacturing sector has stepped firmly into the fourth industrial revolution, with a 10.5 percent increase in the use of advanced manufacturing technologies since 2023, as shown in the final Industry 4.0 Insights Survey by Callaghan Innovation. The Industry 4.0 programme was launched to build awareness and educate New Zealand’s manufacturing sector about the powers of digitisation and connectivity in manufacturing. And, while it’s achieved this goal with 80 percent of Kiwi manufacturers aware of the programme, for Sean Doherty, Industry 4.0 Product Manager at Callaghan Innovation, the real impact has been how quickly that awareness has turned into action. “What seemed experimental five years ago, has quickly become business as usual for many Kiwi manufacturers,” he says. “Manufacturers are increasingly recognising the value of advanced technologies as essential tools for growth and resilience. We now have nearly 40 percent of the workforce implementing Industry 4.0 technologies.” From AI and robotics to real-time data tracking, manufacturers are turning to smart technologies to lift productivity, improve quality and modernise operations. It’s already seen that Industry 4.0 technologies such as AI, digital twins or cloud technology are able to increase productivity by 15-30%. Supporting this momentum, the recently introduced Investment Boost scheme offers manufacturers an immediate 20 percent tax deduction on eligible machinery and equipment purchases. “Capital investment often presents a significant challenge for manufacturers,” says Doherty. “This incentive helps lower that barrier to entry, making it more feasible for businesses to invest in automation, AI and other advanced tools. It’s a promising development and will help keep momentum built through Industry 4.0.” However, Doherty stresses that “technology alone isn’t enough, investing in people and company culture is critical for lasting success.” To view the full Callaghan Innovation Industry 4.0 Insights Survey report, visit: https://www.callaghaninnovation.govt.nz/assets/documents/Industry-4-0/2025_Industry4_Insights_Survey_FINAL.pdf

The Canterbury engineering business with trained staff who never want to leave

Training at the heart of exporter’s success story An unwavering commitment to upskilling its people has helped keep tool maker Sutton Tools (NZ) out in front despite a string of setbacks including an earthquake, a pandemic, and in 2022, a fire that gutted their Kaiapoi factory. Now though, the future looks brighter than ever with a brand-new factory in Rangiora and a forward-focussed masterplan that will drive expansion and power up their knowledge base. Sutton Tools manufactures its high-quality cutting tools in Rangiora, as well as at two sites in Victoria, Australia before exporting them globally. Adopting a proactive approach to training has been a critical factor in their success, and a long-standing partnership with industry training organisation Competenz has been pivotal to this work. For over 30 years, Competenz has collaborated with Sutton Tools, offering apprenticeship and traineeship opportunities to enhance skills and engagement. Production Manager Brian McCallum has spent just shy of 25 years with the company and in that time, he has completed a string of Competenz programmes including a New Zealand Certificate in Workplace Health & Safety Practices (Level 3), a National Certificate in Competitive Manufacturing (Level 4), and a National Certificate in Manufacturing (Metal and Related Products) (Level 3). Currently he’s working towards his NZ Apprenticeship in Mechanical Engineering (Trade) (Level 4) – Fitting and Machining. “I went to Sutton for work experience when I was 17 and I never left,” says Brian. “In that time, I’ve been given lots of opportunities and done lots of different things within the company, including gaining qualifications and temporarily relocating to Australia after the fire to help with running one of the manufacturing plants in Melbourne.” With a myriad of development and career prospects – and a highly supportive, encouraging employer – he can’t see a reason to […]

Industry 4.0 for SME manufacturers

Article 4 – from a series of 5 – From June issue, NZ Manufacturer magazine www.nzmanufacturer.co.nz -Frank Phillips, Director, Fulcrum Article 4: The Significance of Systems in Industry 4.0 and Automation Welcome to the next part of our Industry 4.0 series for SME manufacturer. We’re exploring various companies that can help you embrace advanced technologies and optimize your operations. Today’s focus: Manufacturing Systems. Let’s dive in and see how they can drive your business success. Systems: The Backbone of Modern Manufacturing In the dynamic landscape of Industry 4.0, systems are the backbone that supports and streamlines manufacturing operations. These companies specialize in providing software solutions such as ERP (Enterprise Resource Planning), MES (Manufacturing Execution Systems), CMMS (Computerised Maintenance Management Systems), APS (Advanced Planning and Scheduling), and various other tools designed to solve challenges and manage processes more effectively. Think of them as the digital frameworks that enable smooth and efficient manufacturing processes. Streamlining Operations: How Systems Add Value Manufacturers often grapple with issues like disjointed processes, lack of visibility, and inefficient resource management. Engaging a systems provider can address these challenges by implementing software solutions that integrate and optimize various aspects of manufacturing operations. By leveraging these systems, manufacturers can achieve better coordination, real-time visibility, and enhanced decision-making capabilities. Implementing Success: Typical Engagement and Resource Requirements The journey with a systems provider typically begins with a comprehensive assessment of your existing processes and systems. This phase involves site visits, technical evaluations, and collaborative discussions to identify pain points and opportunities for improvement. The systems provider then establishes to what extent their solution meets requirements, the optimal configuration and any customisation that might be required. Expect to allocate internal resources, including IT personnel, process engineers, and operations managers, to work closely with the systems provider. The engagement would typically take several […]

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