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NZ Manufacturer now on YouTube, see it here: NZManufacturer YouTube Channel

Let’s save the businesses the banks would destroy The following is the opinion of David Newport, a director at business brokers Switch Business: A question often asked of us during the current market downturn is: ‘where are all the distressed business opportunities?’ It is a good question because there are certainly very few businesses being marketed by brokers at present. Those firms that are up for sale are, in the main, smaller, less mature businesses which would always struggle in the challenging economic climate we find ourselves in. The distressed opportunities that qualified, experienced purchasers are looking for are quality businesses, which may be struggling to keep afloat solely because of the debt levels they were saddled with going into the recession. You may recall that, in those halcyon days, the big four (Australian) banks were fighting each other to lend money to business owners and purchasers all throughout the decade until the tap was turned off in spectacular fashion in early 2009. If you purchased a business, or borrowed for expansion in late 2007 or 2008, your business would almost certainly instantly break the covenants you agreed to when you took on the loan. Now – in most cases – there would be very little wrong with the business at all, but the owner would have to focus on how s/he can hold off their bank long enough to ride out the recession. His/her eye would not be focused on developing the business, but rather on creating any number of reports each week to satisfy the voracious bank. The lenders, in this type of environment, are likely to overreact to any cashflow problems, however short-term, and may well force the sale or liquidation of an otherwise perfectly sound business. How did we get here? Because of the competition between […]

Manufacturing activity in January 2011 shows a positive start to the year with the fourth consecutive month in expansion, according to the BNZ – BusinessNZ Performance of Manufacturing Index (PMI). The seasonally adjusted PMI for January stood at 53.7, up slightly from 53.2 in December (a PMI reading above 50.0 indicates that manufacturing is generally expanding; below 50.0 that it is declining).Ê All five indices – production (52.8), employment (52.8), new orders (56.6), finished stocks (50.7) and deliveries (52.4) were all in expansion for the third consecutive month. BusinessNZ’s executive director for manufacturing, Catherine Beard’ said that the continued expansion of new orders over the last 5 months is an encouraging indicator that the expansion will continue, even if it is slow and steady. “While new orders are looking reasonably robust, it is still a challenging manufacturing environment, with more negative comments to positive comments this month. We are predicting a slow and steady improvement in activity in the sector, once the receipts from our improving export performance start to trickle through the economy and increase domestic demand” “Globally, the JPMorgan Manufacturing PMI, which New Zealand is part of, also started the year on a good note for 2011 with the January value at a nine month high. Again, while New Zealand’s position has improved, Australia is still struggling somewhat with softening domestic demand and a high dollar.” BNZ economist Doug Steel said the economy’s recent experience was neatly summed up by one respondent to the PMI survey this month as Ôan economic rollercoaster”. “Our view is that the outlook for 2011 is brighter, but no doubt the rollercoaster ride will continue within the context of a likely improving trend. Today’s further improvement (albeit minor) in the PMI is a small step in the right direction.”  Unadjusted results by region […]

Judging by Prime Minister John Keyss opening address to Parliament we are to anticipate more of the same in 2011; that means a continuation the economic funk seen over the past two years, and the resulting build up of debt. The New Zealand Manufacturers and Exporters Association (NZMEA) is calling for significant policy changes so that the tradeable sector can reverse this slide. NZMEA Chief Executive John Walley says, “There seems to be an assumption that with high commodity prices the economy will just look after itself. We need to spark more investment and capacity expansion across our entire export sector; that is manufacturing, agriculture, services and tourism. “It is worth noting that manufacturing contributes about the same to GDP as agriculture and tourism combined. We will not get rich exporting raw materials.” John Key commented during his address to Parliament that, “The Government will continue to support stable and predictable monetary policy, focused on maintaining a low level of inflation and thereby minimising price increases across the economy. We note that this is not the position of some other parties in this Parliament.”Mr Walley says, “Over the past ten years inflation in the tradeable sector has averaged 1.5% and inflation in the non-tradeable sector has averaged 3.7%. Price based inflation targeting has addressed inflation by killing off the tradeable economy via an overvalued exchange rate. “A vote for a different approach to monetary policy is not a vote for higher inflation but it is a vote for supporting investment and expansion in our export sector. “Continuing with a monetary policy framework that overvalues the exchange rate is a recipe for a low export, low wage and high unemployment economy. Until this policy nettle is grasped, talk of rebalancing and recovery will be just that, talk.”

Can the concepts of Competitive Manufacturing apply to the Food and Beverage Sector? Many of the tools and techniques used have been developed in the automotive and electronics industries, and we are often asked how they can work in a seasonal industry situation. These industries are typically “Manufacture and Assemble” rather than the “Disassemble” or “Process” that you find in the food and beverage sector. In this article we’ll explore some of the differences and how Competitive Manufacturing Qualifications can be used to accelerate change and productivity gains in these sectors. The food and beverage sector can be very seasonal, and many lean practitioners are used to constant demand industries, as such a different approach to training and deployment are required. Look at the seasonal demand of your industry and reflect on the best time to make operational improvements, you will find that the off season is often the best time to build capability in your core workforce and implement new systems and processes. The peak season provides the opportunity to monitor and finetune processes. We often get feedback that this type of program will not work in the seasonal sector because of the high number of casual staff that is employed in the peak season. This is even more reason why an organisation needs to use the tools and techniques provided in the Competitive Manufacturing program. Standard Work is a key element of any process, developing easy to use training tools such as Visual Standards and One Point Lessons accelerate the training of new staff or last years temporary labour reducing the supervision requirement and enabling them to be productive sooner. Quality, productivity, safety, staff and customer satisfaction are all increased whilst reducing operational costs – a win-win for everyone. Frucor Beverages (Wiri, Auckland) have been deploying Competitive Manufacturing […]

The latest addition to the extensive selection of die-cast enclosures from Hammond Manufacturing is the 1550Z family, a range of thick wall (3 to 4mm depending on size) IP66 sealed boxes for use in applications where impact protection and environmental sealing are primary requirements. The 18 industry-standard sizes in the family range from 50 x 45 x 30mm to 223 x 147 x 83mm, and as standard they are supplied in either natural with a smooth vibra-finish or in a tough black polyester powder coated finish. Economically priced, the units offer outstanding value for money, achieved by multi-impression tools and automated machining and finishing during manufacture. Environmental sealing is achieved through a combination of a tongue and groove construction and a pre-formed one-piece silicone rubber gasket; to ensure the integrity of the seal, the fixing screws are outside the gasket area. Depending on the size, the lid is secured with two, four or six stainless steel machine screws going in to factory-tapped holes to aid repeated opening and closing; in six selected sizes with thicker lids, captive screws are used as an alternative. The bases have raised lands to facilitate PCB or component mounting; interior space is maximised with smooth walls and a shallow draught angle. For securely attaching the enclosures to a surface if required, through-box blind holes are provided outside the sealed area. NextSTEP Contact: Hi-Q Electronics Ltd. Email: sales@hiq.co.nz  , Tel 0800 800 293 Hammond Electronics Pty Ltd ABN 13 099 121 981 11 – 13 Port Road, Queenstown, SA 5014, Australia Tel: +61-8-8240-2244 Fax: +61-8-8240-2255 Email: ccookson@hammfg.com https://www.hammondmfg.com

An industry-led approach to the rationalisation of ports in New Zealand, as recommended in a government-commissioned maritime freight report released today (Wednesday 13 October), is welcomed by the Employers and Manufacturers Association Northern Inc (EMA). EMA welcomes the Minister of Transport’s response today to the report from the NZ Institute of Economic Research that the Ministry commissioned, says EMA chief executive Alasdair Thompson. He says, “It would not be in New Zealand’s best interests for port companies in New Zealand to fail to rationalise if that resulted in New Zealand’s hub container port being in Australia. “So yes, there are issues that need to be addressed. “But we have some time on our side to achieve that rationalisation.But there is a risk in leaving it to our port companies to react to future decisions by shipping lines about where they call, as the necessary commercial decisions may not be easy to make for ports that are largely owned by councils, or in Auckland’s case where the port is wholly owned by the Auckland Council from 1st November. “The current owner of the Ports of Auckland (POAL), which is the Auckland Regional Council (ARC), regards the POAL as an investment from which to receive dividends to fund the ARC. The majority of the newly elected Auckland councilors including the new mayor Len Brown, seem to think the same. They see no room for any private shareholding, which could release capital for investment in public transport. “Nor was the ARC willing to consider rationalization when the Port of Tauranga and the POAL began discussing it some two to three years ago. “Rationalisation could well see the likes of the Auckland Council having to stump up ratepayers money for development capital were it needed to meet the needs of becoming a hub port […]

The latest New Zealand Manufacturers and Exporters Association (NZMEA) Survey of Business Conditions completed during September 2010, shows total sales in August 2010 increased 20% (export sales increased by 37% with domestic sales increasing 13%) on August 2009. The NZMEA survey sample covered NZ$493m in annualised sales, with an export content of 36%.Net confidence rose to 40, up from 30 last month. The current performance index (a combination of profitability and cash flow) is at 107.5, up from 103.5 in July, the change index (capacity utilisation, staff levels, orders and inventories) went down to 100 from 101 in the last survey, and the forecast index (investment, sales, profitability and staff) is at 104.75, down on July’s result of 105.5. Anything less than 100 indicates a contraction. Constraints reported were 80% markets, 10% capital and 10% skilled staff. Staff numbers for August increased year on year by 7%. “August has shown a great improvement in export sales. Again it is not across the board, but the last couple of survey results have been very encouraging. It is worth noting that several manufacturers who had particularly weak results at this time last year have had a very strong month this year, perhaps overstating the sales growth result,” says NZMEA Chief Executive John Walley. “Growth is largely from manufacturers exporting to Australia and Asia where growth has continued despite the global recession. Those exporting to the United States and Europe are having a hard time with volume and margin.” “We have seen terrible numbers from manufacturing in the June quarter GDP statistics so it is pleasing to see more up to date figures showing some improvement since then. Confidence and index numbers have remained in positive territory.” “Staff numbers have grown for the fourth successive month.”While the numbers have been improving over the […]

Hawke’s Bay IT company ABC Software is targeting Australia as a potentially major export market for a system it has been developing to track a wide variety of fruit through every step from tree to consumer. Founder-director Sharon Chapman says the barcode-based tool already installed in New Zealand, Victoria and Western Australia traces and records all processes including picking, cool storage, packing and transport to help ensure produce is handled correctly and kept in best condition. “People want to know where their fruit comes from and if it has been handled as it should,” Ms Chapman said. “Traceability is already becoming part of the supply chain – customers and supermarkets want more information as their standards and parameters for good quality fruit are becoming tighter to enhance the eating experience. “Supermarkets are hearing of customer experiences which are not great when they buy fruit it can be soft or with a disappointing taste due to not being cool stored or handled properly. “With more information they can target the orchards they know will meet the parameters they want so competition increases and the whole industry lifts its game  it has been the same with meat with the industry getting better at supplying consistent quality product.” Ms Chapman said the tracking issue was highlighted several years ago when US supermarkets were swamped with diseased tomatoes. “They were pulled of the shelves but no-one had traceability or could immediately say where they came from,” she said. “Traceability was there if they trawled through mountains of paperwork but it was not at their fingertips. “Our system provides that instant information. Every carton of fruit has a unique barcode so if apples are in Hong Kong or Europe the block they were grown on, who handled them and how is all there.” A computer […]

The largest commercial installation in New Zealand of thin film solar panel technology has been activated at Hubbard Foods in Mangere, Auckland. This installation, which is a joint initiative between infrastructure company Vector and cereal maker Hubbards, is the first commercial enterprise of its size to use second generation thin film solar panels. Combined, the 160 solar panel installation covering 227.5m2 will generate 29,000 kW/h of electricity per annum and will be used to power the lighting for Hubbards’ finished goods warehouse. This is equivalent to the power used to produce 169,000 packets of cereal or the amount of electricity consumed by 3.5 homes over the course of a year. “A significant feature of these new generation panels is that they continue to perform, even if it is a cloudy day. This is a key difference with first generation crystalline solar panels which have considerably reduced capacity when the sun isn’t shining,” says Hubbard’s CEO Doug Paulin. “This feature is a decided advantage for a business based in Auckland, which is not known for being the sunniest city in New Zealand. Vector CEO Simon Mackenzie says this initiative could signal a new chapter of solar panel usage by commercial businesses and describes it as an example of developing technology that in the future could lead to power at a lower cost. “While this solar PV installation is not designed to power Hubbards whole business, the savings still count. The added advantage is the new thin-film technology makes them lower cost per watt, easy to install and maintain.” Mr Mackenzie also emphasised the opportunity the initiative provided for Vector in understanding the effect of distributed solar PV systems on its electricity network. “In particular we want to ensure that our network can support this technology into the future,” he says. “This […]