What challenges are small-to-medium-sized manufacturers facing?
There will be many similarities between the regional and national challenges for SME manufacturers. In the Wellington region these include:
Finding a competitive advantage in a globally competitive market.
Gaining access to the most desirable markets and having enough sector profile to be considered an option by customers.
Retaining expertise and capability in a time of uneven and uncertain market demand.
Having sufficient capital to invest in market development.
What support do SMEs need and are they getting it?
SMEs need access to strategy and planning expertise, which is available but can be expensive. The support that is available is really suited for when SMEs are truly export-ready.
This poses the question of how do SMEs become export-ready. As the regional business partner for New Zealand Trade and Enterprise, one of our roles is to help identify this need in appropriate businesses, connect them with experts in that field and facilitate co-funding to build this capability within the business.
In what sectors are New Zealand manufacturers succeeding?
High value-add food and beverage manufacturers appear to be doing very well in the Wellington region. Three examples are Whittaker's chocolate, Yeastie Boys craft brewers and Mojo Coffee. There are also examples of niche manufacturers that have world-class capability allied with flexibility and responsiveness, which gives them a market advantage.
What do overseas markets know about products made in New Zealand?
The general reputation of New Zealand food and beverage products as high quality and safe is well established. This is demonstrated in our dairy exports.
There is a similar reputation in non-food and beverage products, although it is confined to specific niches. Good examples include businesses such as F&P Healthcare, Glidepath and Scott Technology.
In general New Zealand products are perceived by international markets to be authentic in their value proposition and composition - in terms of raw materials - and of high quality.
What help can SMEs get if they want to invest in new plant?It is limited, with not much public sector capital funding, and banks needing evidence of revenue to offer favourable loan terms. However, the network of economic development agencies can provide links to investors and/or advisers who can assist in sourcing investment capital.
This is an area for further development - greater capital investment in the manufacturing sector can have a significant positive impact on local economies. Combined Government and economic development agency initiatives such as the Food Innovation Network are looking at ways to make high capital cost capability and innovation resources available to a wide range of food sector SMEs.
How can businesses market the "made in NZ" label?
The "NZ-made" brand is of strong value in the market but is not a substitute for a quality product that meets a customer need at an attractive price. It might open the door but not clinch the deal.
It is not so much about being New Zealand-made but about businesses putting resources into market validation to ensure their success in export markets and recognising that a targeted approach may be needed for each market.
Geoff Copps is manufacturing and primary industry sector manager at Grow Wellington.