LEADER COLUMN OCTOBER 2012

The Council are working to create a vibrant, walkable inner city with good amenity. This accompanied by our climate, fantastic natural environment and our close proximity to New Zealand’s largest city should make us an attractive destination. So it is sad to walk through the CBD and regularly see empty commercial premises or closing down sales. While this problem is not unique to Whangarei and we are just following trends being exhibited in many of New Zealand’s larger cities, it does not make the situation any more palatable. The situation is in part due to some retail businesses no longer being able to operate in what are very difficult and increasingly competitive times. The situation has not been helped by online shopping and that many office workers relocating their businesses to locations that were once traditionally residential areas on the commercial districts outskirt. A reduction in the overall number of business units in Northland has also reduced demand for commercial property. In the current economic environment there is simply too much space available. This creates a challenge for the Council in their desire to create a vibrant CBD as there is an oversupply of commercial stock and an undersupply of businesses to occupy it. There should be no surprise that there will be a contraction in the area retail businesses occupy within the CBD and possibly a consolidation of businesses around the areas identified by Council for future development. The central city carpark, widening of pavements, more and better located pedestrian crossings, traffic calming and a continuation of the Cameron Street theme will all have a positive benefit on the amenity of the CBD. An increased sense of place and an emphasis on the place of the pedestrian within the city should result in increased foot traffic, something that all retailers want. There is evidence to support this happening elsewhere in New Zealand. For example following similar upgrades to Auckland’s Queen Street, pedestrian traffic increased by significantly. This will be good for some businesses and there may well be other businesses on which these developments will have a negative impact. There is always the risk that an over-emphasis one part of the CBD will result in an opposite reaction in other parts. Where possible this needs to be acknowledged and catered for. This is particularly true where there may be a perception that the focus of development could be advantageous to the Council’s own commercial stock.

LEADER COLUMN SEPTEMBER 2012

Two recent news events highlighted both the contribution that a single industry can make to a region’s economy and the risk that those economies can be exposed to when external market pressures impact on the performance of those businesses. Spring Creek Coal Mine and Tiwai Point are both major contributors to the communities in which they are located. The fact that they have provided a source of employment and income for many years means in many cases results in a strong level of dependance. If these were to no longer operate or operate in a reduced capacity then the impact on their local economies would be dramatic. Many of New Zealand’s regions will have one or two businesses or industries that a significant economic drivers whose absence would be sorely felt. While Northland has one of the more diverse economies in New Zealand we are still strongly reliant on dairy, tourism and the refinery. We would all hope that they will continue to be major contributors to Northland’s growth, but this cannot be taken for granted. We cannot control or influence outside market pressures but we need to ensure that the internal environment in which they operate makes it as easy as possible for them to remain operating here. When these businesses are successful we all benefit. Taking these three sectors as an example I imagine they have more different requirements than they would have in common when it comes to what constitutes a business friendly environment for them. Fortunately those things they do have in common are within our control to influence and enable. We can influence the regulatory framework in which they operate to bring about fair and consistent rules and plans. The local government reforms are intended to help do this through continuing to build a more productive and competitive economy and delivering better public services to New Zealanders. All these sectors require a capable workforce. While it is no secret that Northland has high unemployment when compared to many other regions, recent survey results revealed that many Northland businesses struggle to find people with the necessary skills to employ. It is important that we ensure that private sector and education providers engage early to ensure that the skills and knowledge being taught, match with those required by the region’s employees. Failing to do so fails both our businesses and our communities.

ADVOCATE COLUMN 2nd WEEK OCTOBER 2012

ADVOCATE COLUMN 2nd WEEK OCTOBER 2012 Otorohanga Mayor Dale Williams spoke recently at Mayor’s Taskforce for Jobs evening of the challenges facing New Zealand as an aging population will result in an increasing burden on a diminishing workforce. No region will escape the consequences but regions such as Northland do have an advantage of a relatively high proportion of young people within our population. These youth are and will always be a valuable resource. In the future the demand for workers will grow and the competition for their services from outside our region will also increase. It is also true that at present we do not always provide these young people the best support that we can. On average New Zealand youth are more disadvantaged across a number of performance indicators than many other OECD countries and this disadvantage is strongly concentrated in Maori and Pacific Islanders. With 45% on New Zealand’s total unemployed being youth, this has significant impact on our future well-being. While our youth perform (comparatively) well in education, this does not follow through on average after leaving school. Otorohanga has almost zero youth unemployment. Mr Williams’ council has been successfully managing the transition from school to work amongst the youth in Otorohanga for a number of years now. They believe all young people under the age of 25 should be engaged in appropriate education, training, work or other options, which will lead to long term economic independence and well being. As equally as important as the community assisting youth in the transition from school to work is examining what we can do to ensure that what takes place within schools also assists all our young people to gain employment. One example of this would be the ability to increase student engagement through e-learning. There is strong evidence to suggest that e-learning, combined with a school improvement programme, strengthens student engagement. At Manaia View School which is low decile and has a high percentage of Maori on its roll, an e-learning programme has resulted in a significant improvement in their student’s education performance. This is not teaching technology but using technology to teach and engage students. I am sure there are many challenges to be overcome for this to happen across all our schools and that it will rely on passionate leadership from within the education sector. There are real economic and social benefits if we get this right. In particular this ensures that our young people know they are a valued part of their community.

ADVOCATE COLUMN 4th WEEK SEPTEMBER 2012

ADVOCATE COLUMN 4th WEEK SEPTEMBER 2012 It has been a difficult time for New Zealand export and manufacturing businesses recently with challenges around demand and unfavourable exchange rates resulting in low economic growth. This is unlikely to change dramatically in the near future but the news is not all bad. Some New Zealand businesses are performing in a manner that defies this trend particularly those that operate in ICT, high tech manufacturing and the bio-tech sectors. Sectors in which reliable and ultrafast broadband connectivity along with a capable workforce often are essential elements to them are operating successfully. New Zealand has an innovation sector worth $7 billion a year. It contributes $5 billion per annum of exports and yet is largely based around only a handful of companies. These companies are among our biggest export earners and show that New Zealand can compete globally as a manufacturer and exporter. These companies often occupy a niche international market and operate largely unnoticed by the wider community. This is evidence of what many commentators and politicians have being saying for some time now. That is that to grow our economy and increase our productivity requires innovation and the identification of those international niche markets where our comparative lack of size can actually be a competitive advantage. Further evidence of this was the latest NZ Chambers of Commerce Northland and NorthTec’s lunchtime address by Paul Davies Director of Intellectual Property at EverEdge IP on the commercialisation of technology and Intellectual Property. It demonstrated both the interesting and innovative world leading technology taking place in New Zealand and some of the support that is currently available to assist new enterprises to compete globally. He also provided valuable insight on how to go about the process of developing a good idea into a commercial enterprise. To grow our wealth and raise our GDP will require a shift to a high wage economy. Successful manufacturing and export businesses have shown that isolation and scale are not in themselves barriers to a successful manufacturing enterprise. These companies are involved in manufacturing things of high value by weight and that have a high profit margin. We have an attractive physical environment and lifestyle in Northland. What is needed is to ensure that we create a social and commercial environment that encourages innovation and values excellence in research and development. If we can develop this environment along with a capable work force this can remove the perceived barriers of isolation and lack of scale and allows a focus on high waged economy that is required for transformational change that will benefit all our communities.

ADVOCATE COLUMN 2nd WEEK SEPTEMBER 2012

ADVOCATE COLUMN 2nd WEEK SEPTEMBER 2012 The first week of this month marked Money Week. This was an initiative led by the Commission for Financial Literacy and Retirement Income. It was week-long series of financial education events and activities undertaken by many different organisations around the country to raise awareness of how people can better manage their money and where they can get help to do so. The objective being to inform people -whether they were employees or employers- about what areas of their financial life they need to make informed decisions about and who can assist them make positive money choices For Northland, financial literacy -like all forms of literacy- is essential to improving the capability of our work force and to empower people to take control of their finances. Over the last two and a half years many business people have had to increase their financial literacy as it relates to their businesses and how their businesses really operate. In many cases this has resulted in improved business practices and a higher level of management capability. With household credit card debt exceeding $3.5 billion, we need to take the lessons businesses have taken on board regarding living within their means and transfer these skills and knowledge into our homes. It is not a criticism of individual choices nor does it ignore the fact that we have a low waged economy, but rather a suggestion that the better informed we are, the better choices we can make. Unfortunately changing behaviour developed over a lifetime among our adult population will not be an easy task. Increasing the financial literacy and reinforcing good habits in those about to enter the work force or undertake tertiary education however is likely to have a higher chance of bringing about a positive financial result. For many young people tertiary study offers them their first taste of financial independence. They face decisions about student loans, leaving home and getting part time jobs. They need the skills that will lead to good financial decisions and that will set them up for their adult life Young people having a better understanding of financial matters would be of great benefit to Northland communities. It would allow them to make better decisions about debt and lifestyle and ensure that they can maximise their potential for a secure future. These same skills raise the capability of our workforce which in turn should raise productivity and wage levels.

BUSINESS ADVOCATE COLUMN SEPTEMBER 2012

BUSINESS ADVOCATE COLUMN SEPTEMBER 2012 NZ Chambers of Commerce have for a long time being advocating Northland businesses investigate the uptake of ultrafast broadband. If companies want to stay ahead of their competition they need to keep up with the latest developments that will result in robust, reliable and affordable data usage. Data usage in recent times in New Zealand has doubled and with the proliferation of smart devices this will only continue to grow as the consumers preferred choice to access information. It is amazing how often small business owners respond that they are not involved in technology and innovation so they do not see how their business would benefit from uptake of UFB. While it is true that UFB and the rural broadband initiative will provide the impetus for developing technology and innovation related businesses, this is not to say that the average or traditional business would not also benefit. Given that Northland is both isolated and that our business profile is predominately small enterprises, UFB can enable companies to use technology to increase their competitiveness through improved processes and to reduce their isolation through connectivity to a much larger market. A news article on television brought this home to me when it reported a post office in a rural mining town in Australia had experienced a large growth in its parcel delivery service directly related to online purchasing. It highlighted that a large majority of consumers are now shopping online and the opportunity that connectivity to a wider market can present any retailer anywhere in the world. As well as the expanded market, technology enables processes around sales and distribution to be streamlined in a manner that reduces the length of time between when an order is placed and the customer receives the product. This obviously reduces the time between when they receive and pay for the goods from their supplier and the time they in turn get paid by their own customers. Service will always be a critical factor and technology can allow any business to exceed the customer expectations. If you are in business in Northland and if you have previously thought that your business would not benefit from increased improvements to technology, then perhaps it would be worth your while to consult an IT expert regarding the subject or to look at what your competitors are doing that may be giving them a competitive edge.

ADVOCATE COLUMN 4th WEEK AUGUST 2012 With the entries for this year’s Westpac Northland Business Excellence Awards now closed I thought it would be worth revisiting another business award event that took place recently. That was the Te Tai Tokerau Maori Business of the year 2012 which was held in July in conjunction with the Te Hiringa Maori Business Expo. This was a thoroughly enjoyable and encouraging series of events that highlighted the achievements of Maori businesses, the whanau directing and supporting the enterprises and the unique Maori perspective that characterises their success. The overall winner this year was Kaikohe Scrap Dealers owned and operated by Gavin and Tahu Robertson. The convenor of judges, Steve Bennett highlighted “their winning formula based on manaakitanga, whanaungatanga and aroha ki te tangata. They embrace values of integrity, respect and honour in the way they do business which has won the admiration of its peers and confidence of Tai Tokerau hapori.” I would suggest that these values would stand any business in good stead when endeavouring to create a sustainable economic future. This event was very important to Northland for so many reasons. The success of our regional economy is strongly related to the success of Northland’s Maori economy. Lifting the performance of Maori business benefits all our communities. The success of this year’s entrants shows the value of raising the aspirations and capabilities of whanau to achieve this. Improved capability will grow capital and investment through higher income, greater savings and increased financial literacy. The Maori population is young and expected to grow significantly over the next decade. Their proportion of Northland’s workforce will continue to grow in the future and this workforce in a position to influence and contribute to our economic future. As a point of interest as to why under performance of this sector of our economy should not be underestimated is the unrealised potential benefit to our region. BERL recently estimated that the Maori asset base totals at least $36.9 billion nationally. Based on their modelling if the level of productivity in the Maori economy is lifted to equal the national level by 2061, the GDP contribution from the Maori economy could be $12.1 billion higher than it otherwise would be and there could be 148,000 more job opportunities. This transformation will require strengthening capability of Maori business and increased collaboration. Events such as Te Hiringa Maori Business Expo have a valuable role to play in this process.

ADVOCATE COLUMN 1st WEEK AUGUST 2012

We are now beginning to see the first physical signs of the roll out of UFB and RBI in Northland. Anyone who has visited the CBD lately will have seen Northpower Fibre technicians carrying out installation work connected with the Whangarei UFB roll out, while at the same time Bayley’s Beach residents have already benefited from improved connectivity bought about by the new cell phone tower which is part of Vodafone’s commitment to the RBI. Broadband is the new essential utility and is as vital to economic growth as clean water and good roads. UFB will provide every business the capability to access to reliable and ubiquitous broadband. It is the ability to do what you need to do, when you want to, where you are, and without having to compromise on quality. Northland has a two year competitive advantage during which we can exploit this utility to deliver better health, better education and more productivity and in doing so promote our region as progressive and business friendly . We will all need to embrace this technology in innovative ways. We need to consider what the outcomes are that this technology can provide and how will this change the way they operate? This is not just about doing things faster but about providing a platform on which rich content can be developed and used. For many businesses it will require a major change in behaviour for this to occur. Presently only 17% of New Zealand businesses sell direct to customers online via their own websites. At a regional level only 30% of Northland businesses have websites suggesting traditional businesses here have shown a reluctance to adopt new technology and innovation. With 80% of New Zealanders searching online first for products or service and 44% buying products, services or paying bills direct to websites, those businesses with websites must experience a competitive advantage. As more retail service providers come onboard with competitive and relevant supply offers for the consumer there is no reason for Northlanders not to take advantage of technology and grow their market. When accompanied by consistently high quality service and products this connectivity allows access to a national and global market not currently available to at least 70% of their regional competitors. Just as we as a region have an opportunity to benefit nationally from being early adopters, so to do individual businesses have an opportunity to be more competitive than other local businesses that fail to see the advantage that technology and innovation have to offer.

ADVOCATE COLUMN 4th WEEK JULY 2012

Congratulations to Mike Sabin for organising his recently held the Whole of Northland Economic Summit. This consisted of two separate seminars at which over 200 attendees from various sectors throughout Northland met to discuss those things that could enable economic growth and those things within our control that currently inhibit growth. The objective being to develop a plan of action that will allow Northland to lift its economic –and social- performance to a level that is comparable to the rest of the country. While it would be unrealistic to expect that at the completion of these two seminars the participants would have arrived at a fully resolved plan of action, it was encouraging to see the progress made and the level of support that Mr Sabin had garnered from his parliamentary colleagues for this projct. The presence of a number of key cabinet ministers was evidence that there is a willingness from central government to work with regions to grow their economies. There were a number of underlying themes that emerged during the two days and these were reasonably consistent across sectors. Foremost among these was the need for Northlanders to adopt a more collaborative approach to raise their performance and the for local government regulations to be business friendly and enabling of economic development. Neither of these was a surprise and they are regularly seen as critical drivers to us achieving our potential. It is also timely that they have again been raised as the subject of Northland’s future structure of local government is under scrutiny. While the existing structure of three districts and one regional council do not preclude collaboration and although all councils express a desire for it to occur, in last year’s “Local Government Options for Northland” report prepared by Sir Peter Trapski and Dr Don Brash, Sir Peter stated they saw little evidence of collaboration. There was also overwhelming support amongst those I spoke with during the seminars that there be a single plan for the whole of Northland that provides certainty and enables development. When considering changes to local government it will be important to examine all options available with an open mind and a strong focus on what we wish to achieve. Neither collaboration nor a single plan is reliant on structural organisational change within local government but in many cases it may be easier to bring about if there was a change.

ADVOCATE COLUMN 2nd WEEK JULY 2012

Although the playing field for economic development remains extremely uneven local government throughout New Zealand is trying, with limited resources, to play a meaningful economic development role in shaping the future of their communities. New Zealand Chambers of Commerce Northland strongly believe local government can make an important contribution to grow local economic activity by providing ‘business friendly’ services – responsive regulatory and consent regimes, low competitive rates - efficient infrastructure, positive promotion of the local area, attracting tourists and events. Councils rely on their local business sector to generate jobs, invest in the local economy and support the industries like tourism that benefit their whole community. As recently as May this year a MYOB Business Monitor quarterly survey reported that 64% of owners of Northland small to medium enterprises expressed dissatisfaction with the performance of their local councils in what was described as an environment of rising rates and arduous consenting processes. When it comes to identifying why business is dissatisfied with local government I would imagine it could be for a wide range of reasons. There may well be a sense of frustration around difficulties in resource consent processes, a sense that they are not getting value for money from ever-rising rates or that they just want councils to perform with the same level of efficiency and good governance as has been required of businesses during these difficult economic times. Equally when people have seen their lifetime endeavours put in jeopardy by influences beyond their control they may just be looking for someone to blame and councils can be an easy target. A common issue that arises when business talk of frustration with local government is the barriers that they perceive are in place around resource consent and compliance. However there is often little empirical evidence available to support this assertion and anecdotal evidence is often third or fourth hand. The Chamber is interested in hearing from business people who have directly experienced difficulties in obtaining resource consents. What their problems were and how they believe it impacted on our economy. We believe by sharing these experiences the private sector can then work collaboratively with local government to improve systems and to remove barriers that currently result in dissatisfaction with local government performance. This should not be about apportioning blame as all parties involved seek a prosperous and vibrant district. An evidence based solution will create a business friendly environment that enables economic development and benefits all communities.

BUSINESS ADVOCATE COLUMN JULY 2012

If existing markets are crowded and population growth limited, how do we grow new business? It seems like a tall order for an emerging enterprise to shoulder its way in amongst existing competitors or for existing local companies to compete against larger national operations. Yet for our regional economy to grow, it goes without saying that existing businesses must develop and grow and new businesses must enter the market. For these things to happen requires a high level of business capability, financial literacy and governance. The start point may well be for existing businesses of all scale to undertake a critical audit and establish what their current levels of the above attributes are. The challenge is how a business can examine their enterprise within a sufficiently rigorous and impartial framework that allows for them to develop a meaningful way forward. There are many very competent business consultants who can assist you to do this and this is a perfectly valid path to pursue. In most case this should result in an improved level of capability although the level of understanding of how your business works may still vary depending on the methods used in this process. The understanding of how your business operates across many aspects, of how it responds to change, of how it makes decisions on future direction and of how the result of these actions is confirmed by results is critical in being able to develop and grow in an ever-changing market. The Westpac Northland Business Excellence Awards have been developed to provide the first step in the process of understanding how your business operates, what its strengths and what areas you could work on to further develop and grow the enterprise. The entry form and accompanying workshops walk the business owner through the process of understanding your business and will quickly identify how your business is truly operating. Exposing yourself to this level of examination requires a degree of courage as the results may not always be pleasant. However where this is used as a start point from which a plan can be formulated that will develop and strengthen a business then the benefits will always outweigh any discomfort. New Zealand Chambers of Commerce is still accepting entrants in this year’s awards and would encourage all Northland businesses to consider entering as the first step in developing a competitive and sustainable business.

ADVOCATE COLUMN 4th WEEK JUNE 2012

New Zealand Chambers of Commerce Northland has long advocated for businesses to provide consistent and high quality service. It is all about exceeding the customer’s expectations. We are all aware of businesses that offer poor or inconsistent quality of service and how consumers react to them. I raise this because recently I experienced the same low level of customer service that so many of us have to endure all too regularly. My wife had given the local branch of a national department store a reasonable sum of money in return for them supplying us with a bed. The bed wasn’t in stock at the time so they advised they would have it in stock within seven days or at the very least let us know when we could collect it. Needless to say none of this happened and was accompanied by total lack of interest in us once we had parted with our money. This column is not long enough to detail the various ways our expectations were not met. However I know money is important to them because I stood in front of one counter for several minutes waiting to enquire about the whereabouts of the bed while the assistant did her best to pretend I was not there while she discussed her own personal finances with someone on the other end of the phone. A customer has the right to expect a consistently high quality of service from well-informed; well trained people who are enthusiastic about the product or service that they are delivering. These values will be driven by the business owner. They will be the ones who make who ensure the right staff are hired and are given the appropriate training. That training will focus on developing confident service staff who recognise the importance of selling to the consumer and creating an ongoing relationship with them. The owner must also construct a business framework that enables the staff to fulfil their potential and do their job without physical and procedural boundaries. That is that customer relations are managed and supply chains are robust enough that the business can do what it says it does. Finally the owner is tasked with ensuring all within the business understand his or her vision and what it is that they want the customer to experience. This is the story that the consumer will take away with them and tell their friends.

ADVOCATE COLUMN 2nd WEEK JUNE 2012

According to studies undertaken in recent times, it is understood that in general Maori land in New Zealand is underperforming and underutilised. MAF states that about 1.2 million hectares of the 1.5 million hectares of Maori land is not realising its true potential. Maori land makes up 11% of Northland’s land area and of this almost 41,000 hectares are in developed pasture. Past surveys have shown have shown Maori-owned farms in Northland operated at a significantly lower profitability than of non-Maori owned farms. A number of reasons have been identified for this such as, conservative stock policies reducing gross farm revenue, lack of education and training in new technologies, governance issues, trustees being slow to respond to market signals and restricted access to development capital. So why is this important? Maori are an integral part of New Zealand Inc. The Maori economy contributed $37 billion to New Zealand’s economy in 2010 and although in recent times this economy has been diversifying it is still strongly linked to land related primary industry. About 60% of Maori assets are in the primary and tourism sectors. These are also two key economic drivers for our region. So when people speak of low hanging fruit within the Northland economy it should not be underestimated the difference a shift in the performance of this land would make to all our communities. It would be of great benefit if Northland’s public and private sector can work with Maori business to enable them to be as big an influence on our economy as they already are on our culture and unique character. There are many challenges that need to be resolved for these businesses. They are often assets rich and cash poor as a result of the legislative framework of their land holdings, they also have the difficulty of separating commercial and non-commercial activities held by trusts and problems in raising sufficient capital for infrastructure investment. As it is likely that these land holdings will increase over time, it is important to realise that the implications of this underperformance impacts on all Northlanders. It is also necessary to recognise the complex relation of the people and this land and that this relationship goes well beyond economic matters. This land is a key component of who Maori are and their past. Hopefully through partnership it will also be a key component to realising Northland’s future economic and cultural potential.

ADVOCATE COLUMN 4th WEEK MAY 2012

There can be no doubt that the decision by Refining NZ’s shareholders last month to support investing in Continuous Catalyst Regeneration Platformer will be of a fantastic benefit to Northland. Through improved energy efficiency and reduced fuel losses, Refining NZ will be able to process more crude oil to produce more oil products. Setting aside the anticipated return for investors this project is significant for several reasons. It has provided an opportunity for investment in a project that will strengthen New Zealand Inc’s supply chain. At the same time it will benefit the national economy as the projected increase in production capacity and improved efficiency will result in fewer imports and a large saving over time in foreign currency. Obviously at a regional level this investment will create high quality employment and a chance for Northland companies to improve their capabilities in international technology and engineering. Since its establishment, the refinery has played an important role in Northland’s growth. Not only is it a significant contributor to the regional GDP, it has also supported a wide range of community initiatives to the benefit of all Northlanders. There are many businesses which through their relationship with various refinery projects have been able to grow their capability and reputation to a level that has allowed them to compete on the international stage. This may not have happened if various refinery projects had not taken place. Given the significant role that Refinery NZ does play and will continue to play in New Zealand’s supply chain and that a majority of the nation’s fuel will be processed and distributed from Marsden Point, this development could provide the impetus for yet another component required in changing Northland’s economy. Is it prudent to rely on a single mode of delivery –the current pipeline- of this fuel from Northland to New Zealand’s largest economic centre or should more thought be given to securing an alternative line of supply in the form of upgrading the North Auckland rail line? This in turn could act as a further catalyst for other infrastructure development such as increasing the capacity and capability of North Port or other commercial growth such as the relocation of manufacturing from around the upper North Island to Ruakaka’s industrial land. Quite apart from the obvious and direct economic benefit that the CCR expansion will have, it will be interesting to see what indirect benefits will also occur for Northland.

ADVOCATE COLUMN 2nd WEEK MAY 2012

In April I was lucky enough to attend an event marking the Kauri Museum at Matakohe’s 50th year. This was the first time in a while that I have been to the museum and was once again struck by how much progress an organistaion and community can make in a relatively short period of time when it is driven by passionate management and volunteers and has competent governance. This establishment has a strong and sustainable relationship with its community. Over the years it has become a “must do” for many visitors to Northland. If our people are one of those things that gives us a real point of difference then places such as this are critical in telling our story. The event also included a short presentation by the Tourism Development Group on tourism in Northland. They outlined the role tourism plays in Northland’s economy and the challenges facing this sector in order to grow the industry and increase the value of the product delivered. It highlighted that a recent Roy Morgan Research survey found that Northland is New Zealand’s most preferred domestic tourist destination and is consistently rated highly by various international travel organisation surveys. The speaker Jeroen Jongejans identified three low-cost actions that central government help with that would be of benefit to Northland as a destination. The first was the designating Waipoua Forest as Kauri National Park and giving recognition to this natural and cultural treasure. Many overseas travellers consider this as the highlight of their visit to New Zealand and the role Kauri has played in the nation’s economy and cultural diversity should not be underestimated. Secondly there are a number of cultural and natural locations within Northland identified as potential World Heritage sites. The formal designation of one or several of these locations would further strengthen Northland’s attractiveness to both domestic and international tourists. Finally the development of a Marine Recreational Park along a small portion of Northland’s east coast would send a strong message to world the we are passionate about our environment while at the same time allow us to add real value to a natural resource to the benefit of local businesses. Tourism is not the only answer to changing our economy but it is certainly part of the solution. Where opportunities to improve our reputation and attractiveness to others exists, and where it can be done with only minimal investment it should be actively pursued.

ADVOCATE COLUMN 4th WEEK MARCH 2012

The Westpac Northland Business Excellence Awards provides an opportunity to celebrate business excellence and the role it plays in our community. Through business, countless individuals can apply their talents to achieve their own aspirations and provide service for others. If we can celebrate and respect these people, and foster a better understanding of the contribution business makes to the wider community, then this will go a long way to inspiring more young people pursue their own aspirations. Business is a competition between various enterprises vying with each other to give the customer better a service or product for their money. Their main function is to be efficient producers of goods and services responding to market demands. In the process of doing this there are often other benefits to society and the community. Business assists in the provision of an economic environment that allows us to live and work where we chose. Many businesses support a wide range of community and not for profit initiatives. Preparation for this year’s Westpac Northland Business Excellence Awards is now well underway and Northland businesses can register their expressions of interest to be part of this event. Many of Northland’s prominent business people past and present have played an active role in shaping the region through both their commercial enterprises and through their civic activities. These awards provide a great opportunity for Northlanders to celebrate those amongst us who have made significant contributions to making our region a better place. Unlike in the marketplace, in the awards businesses are not so much competing against other entrants but against a set of performance indicators. An entrant’s performance will be rigorously tested against a number of key criteria and that business’s vision and strategic plan. Success cannot be measured without a business first having set clear goals. In many cases these are closely aligned to the personal aspirations of the people and families who own these businesses. For administrative purpose past entrant categories have been grouped around sectors and the products or services they provide. A major change in this year’s awards will see entrants grouped together based on the size of their workforce. This will mean that entrants within each category will be of a similar scale and should in theory be doing similar things in relation to business excellence. If anyone wishes to know more about the awards or the changes we are making this year please feel free to contact our office at info@northchamber.co.nz.

ADVOCATE COLUMN 2nd WEEK MARCH 2012

Local government is once again a hot topic both within Northland and at a national level. While debt in most sectors is declining debt in the Local Government sector continues to rise. Minister of Local Government, Nick Smith has commented that Local Government have increased rates a 6.8 percent of the last ten years compared with the average inflation rate of just 3 percent. I would imagine that this discussion will continue to be of interest to many people over the coming months and that there will be a wide range of perspectives offered on how we can achieve affordable and sustainable governance at a district or regional level. This will come to the fore as Northland’s various councils release their Draft Annual Plans for submission. These plans are intended to be a community’s long-term goals and priorities for a 10 year period. They will contain information about the activities provided by the council including the level of service the community can expect and their contribution towards each of the community outcomes. More importantly it will outline how much this will cost over the same period and detail how it will be paid for. This tension that exists between low rates and a high demand for amenity will be an issue of much discussion. Local councils are in an unenviable position of already high levels of debt and demographic profile that may challenge the traditional framework of infrastructure investment funded by trans-generational debt. At the same time community expectations have increased and external influences have raised the performance level required of many of services they provide. Leaky buildings, earthquake strengthening, water quality waste treatment will all put additional pressure on debt and require that careful balance when allocating spending. A natural consequence of these issues of debt and community expectations is likely to be the rekindling of discussions as to what is the most appropriate structure of governance for Northland. There needs to be informed debate around how many territorial authorities do Northland -or New Zealand for that matter- really need. Also what is an appropriate level of debt for local authorities to carry and how much of this debt should be placed on future ratepayers as opposed to today’s ratepayers. This should be interesting because affordable and sustainable local government may not necessarily be the same as consultative and inclusive local government.

BUSINESS ADVOCATE COLUMN FEBRUARY 2012

We are well underway with planning for this year’s Westpac Northland Business Excellence Awards and once again the More FM Customer’s Choice will be one of the more highly contested categories. To say that a customer’s perception of the service they receive is critical to a business’s success is an understatement. Any review of online customer feedback websites will show many examples of various Whangarei businesses with such great a range of customer feedbacks that it hard to believe that the reviewers are talking about the same business. Generally a business exists to sell a product or service in return for financial gain and because of this a company’s entire profit is derived directly or indirectly from the customer. So it is critical for any business that the leaders and the staff have the right attitude and the right systems to ensure the delivery of a consistent high quality service that reflects the company’s brand. It is important to have systems and processes in place that allows a business to ensure that the right people are employed and that the customer is listened to and feedback is responded innovatively. However it is leadership that will ensure that this becomes deeply embedded in the company’s ethos. We assume the right people have been recruited and that may not necessarily be those with the best product knowledge and skills but with a passion to exceed the customer’s expectations. If this is actually the case then the critical element will be leadership both by management individuals within the workforce. The leader needs to be able to communicate what the company is all about and what experience the customer should be entitled to. Then they must monitor and modify behaviour to ensure that these expectations are met. This will require them to give feedback and through their own actions make it clear that the customer’s experience is important. More importantly it will require management to have critical examined their business and considered carefully what their product or service is. They will have identified who is their market and what they expect. Finally they will have identified and implemented the systems and processes required to ensure the right people are recruited, trained and led that will ensure that the customers’ expectations are met on every occasion. If we as businesspeople can strive for this and we as consumers can demand this occurs, then we can develop a reputation for service excellence.

LEADER COLUMN AUGUST 2012

The local government reforms announced by central government in March are intended to address two of their priorities; continuing to build a more productive and competitive economy and delivering better public services to New Zealanders. It is not necessarily about amalgamation of existing councils but is intended to enable this to happen if there was a belief that doing so would assist in achieving these outcomes. Determining what a council should or should not do is not an easy task. The tension between democracy and providing sustainable and affordable governance means there are many demands from many different sectors of our communities. In some ways this is the strength of the four well-beings and the way they provide a council with a degree of flexibility as to what their role is. It allows them within a framework of financial prudence to cut their cloth according to the needs of their community. However this is often easier said than done. Economic development is a case in point. It operates on a continuum of those tasks that are solely the responsibility of central government to those that should be left solely to private sector. Along this continuum there are likely to be gaps or grey areas that no one is willing or capable of taking responsibility for. Council’s have a genuine role in economic development - mainly through facilitation and making the council more business friendly and open through providing secure, reliable infrastructure, accommodating business requirements, keeping barriers to doing business low, and ensuring rates are kept competitive - and in which local business organisations are identified as ‘potential’ partners. Establishing successful partnerships to harness economic development initiatives is the key. They have the potential to achieve economic development outcomes that would otherwise be unattainable. Partnerships focussed on meeting the needs of business are important for many reasons, not least of which that in the past with a few notable exceptions, EDAs have not been as successful as they could be. This may well change in Northland with the restructuring currently being undertaken by Enterprise Northland. The Chamber believes local government can make an important contribution to grow local economic activity by providing ‘business friendly’ services – responsive regulatory and consent regimes, low competitive rates - efficient infrastructure, positive promotion of the local area, attracting tourists and events. Partnerships can create a more innovative, commercially successful community. Strong-community based business organization such as the Chamber of Commerce can have a role in organizing and convening the partnership processes.

LEADER COLUMN JULY 2012

During the first weekend of July I was fortunate enough to attend the Northland Chef’s Association annual Matariki Hospitality Awards. Apart from the opportunity to sample dishes prepared by some our region’s best chefs it was once again a reminder of number of issues that are important to Whangarei and Northland. Firstly, tourism is a major economic driver for the region but it is generally a low value product. If we are to transform this product to a higher value then consistent high quality service from our hospitality sector will be crucial to our success. This is a difficult industry with often complex supply chains, an inconsistent workforce and seasonal variations. All of which require skill, experience and a high degree of business capability to manage. Secondly, it showed what a difference an individual’s passion and leadership can bring to a business community. All the participants in this year’s event showed a high degree of passion and pride in what they did. This was also evidenced in their passion for the region and their desire to improve Northland’s reputation as a destination of choice. The fact that they have been operating in difficult times had not diminished their desire to maintain high standards and to strive to make their businesses something special. Furthermore, when we look at what makes the towns of our region different from other parts of the country, these locally owned and operated businesses are a key component. Many out of town visitors will associate the restaurants and cafes where they have enjoyed a dining experience with the places they have visited when recounting their journeys to their friends. This strengthens our reputation and provides an opportunity to express Northland’s unique character. It takes a degree of courage to put your business performance up to be evaluated against others within your own industry but perhaps the hospitality sector above all sectors is more inclined to do this. Every day when they open their doors for business they are going to judged by their customers in a manner that is more critical most other enterprises. They will be evaluated based on the quality of their service and food, their menu and their value for money within the context of the occasion. The consumer is more likely to share their good or bad experiences and these businesses live or die by their reputation. Based on what was on display at the Matariki Awards these leaders have set a high standard for others in the industry to aspire to.

LEADER COLUMN APRIL 2012

Having someone to listen to you, occasionally challenge the way you do things and offer guidance based on their own experience can give a business owner the confidence that they are doing things the right way or at the very least are not missing out on potential opportunities to develop. Business Mentors New Zealand (www.businessmentors.org.nz) provides a mentoring service to businesses that have been operating for at least six months and is the owner’s main source of income. A registration fee of $100 + GST applies, which entitles you to use the mentoring service for two years. This is the only cost to you. The Northland Chamber of Commerce assists businesses in a number ways including on occasions using its network of members to help operators who may not meet the registration criteria of Business Mentors New Zealand. When a business is struggling they need all the help they can get. Using a mentor allows an independent perspective that may not be apparent to the owner. Many people do not engage a mentor until they notice things starting to go wrong with their business. There is merit in getting a mentor or outside assistance before you think you need it. Early involvement helps avoid pitfalls and gives the business the best chance of succeeding from the start. Mentors may have many different reasons for giving up their time to assist struggling businesses. Apart from a desire to help Northland’s economic development it provides the opportunity for people who may are no longer be active in the business community to stay in contact with an environment that has been a large part of their life. Although all find the experience rewarding, the Northland Chamber of Commerce is always in search of new mentors to reduce the burden on these volunteers to assist new clients. We are currently seeking people Northland’s business community who would like to use their experience and skills to help succeed with their enterprises. If you think this is something that would appeal to you then we would love the opportunity to tell you more about how you can help grow Northland’s economy. Growing Northland business is as much about ensuring existing businesses succeed and flourish as it is about encouraging inward investment and new business. The trickle-down effects from a business failing, impact on the entire community. Equally all Northlanders benefit from the presence of robust and sustainable local companies consistently providing quality service and products.

LEADER COLUMN MAY 2012

The 2012 Westpac Northland Business Excellence Awards are now open for entrants and details of categories and timings can be viewed on the Award’s website http://northlandbusinessawards.co.nz/. New Zealand Chambers of Commerce Northland urges all Northland businesses to seriously consider entering and we are willing to do all we can to assist businesses in the process. It is free to enter and is open to any Northland businesses not just those who belong to the Chamber of Commerce. The big change with this year’s Awards is that we will no longer be clustering entrants based on the sector they represent but will be grouping them based on the size of their business. In the past there has been feedback that businesses would prefer to be evaluated against businesses of a similar scale as they believe that this would give them a better comparative indication of how their organization is performing. We will be running a series of workshops to assist potential entrants understand the evaluation process and what is required from them when completing their entry form. Following these workshops, the Chamber will also be in a position to provide additional tutoring to entrants if required. All entrants receive feedback from the judging panel focused on identifying areas of their business that may benefit from being revisited and improved. Westpac Northland Business Excellence Awards provide a great opportunity for businesses to celebrate what they have achieved to date and to plan where they want to be in the future. They are also a great business development tool. In recognition of the business development component of the Awards, all entrants will be eligible and encouraged to participate in a training needs assessment undertaken by Northland Business Grow Team. Following this assessment an action plan will be prepared for that business and in some cases the individual businesses may be able eligible for funding to assist in developing their business capability. The entrants will, be evaluated using a modified Baldrige criterion based closely on a standard developed by the New Zealand Business Excellence Foundation. The judging process combines a desk-top business study followed up by on-site judging from the Westpac Northland Business Excellence Awards judging panel. While every business person will ultimately judge the success of their own business on its bottom-line, past entrants have consistently commented that, the entry process provides real value to systematically examine their businesses and identify opportunities to improve what they do.

LEADER COLUMN MARCH 2012

The release of Northland’s 2011 Economic Profile (Infometrics Limited) once again highlights both the challenges facing Whangarei District, the importance of Whangarei to Northland’s overall economy and future opportunities to grow. GDP in Whangarei measured $1,897m in the year to March 2011, up 1.4% from a year earlier. This growth ranked us at number 34 compared with the other 72 territorial authorities in New Zealand. Manufacturing made the largest contribution to overall growth with 21.3% of total GDP. The other major contributors were business and property services (10.6%) and wholesale and retail trade (9.8%). Industries highlighted as having the largest comparative advantages were petroleum, chemical, plastic, rubber manufacturing, non-metallic mineral products manufacturing, and forestry and logging. This report outlined the performance of individual sectors and industry compared with last year and the overall performance over the last ten years. For example Whangarei's agriculture sector declined by 1.8% in 2011 compared with growth of 1% in the sector nationally. This sector contributed 4.6% to the district's economy in 2011, down from 6.8% ten years ago. The agriculture sector employed an average of 1,926 persons in Whangarei in 2011 which was down from 2,002 in 2010. Forestry by comparison contributed 2.7% to the district's economy in 2011 and grew by 17.8% in 2011 compared with growth of 10.5% in the sector nationally. There was an average of 205 jobs in forestry up from 172 in 2010. We still have one of the more diverse economies in New Zealand and once again we have experienced a decline in business growth with 9,195 business units were recorded was down 2.2% from a year earlier. The number of business units in New Zealand declined by 0.6% over the same period The total employment in Whangarei averaged 33,682 in the March 2011 year, down 1.9% from a year earlier. Employment in New Zealand increased by 0.2% over the same period. Tertiary industries accounted for the largest proportion of employment (72%) in Whangarei, which is lower than in the national economy (74%). Communication services made the largest contribution to employment growth the industry adding 44 jobs over the last 12 months. Not surprisingly construction was the largest detractor from growth a decline in employment of 319. I would suggest that anyone interested in what are the potential key economic drivers for Whangarei read this document and consider how this is likely to affect them and their business.

LEADER COLUMN FEBRUARY 2012

Several recent articles in national newspapers have once again highlighted the opportunities that could exist for Whangarei because of its location in close proximity to New Zealand’s largest city. Obviously there is potential for our deepwater port to benefit in the future as Port of Auckland meets its capacity, struggles with reverse sensitivity and considers whether storing several hundred thousand containers is the best possible use for a world class city. But it is more likely that it will be issues around quality of life and the challenges of living in a large metropolitan centre that may make Northland attractive alternative to Aucklanders in the near future. While not wanting to view Whangarei through rose coloured glasses and recognising that we still have a number of issues that need to be resolved, we do have a lot to offer those disaffected with living in an overcrowded city with an infrastructure stretched to near capacity. Two factors that could potentially affect the quality of life of people living in such a large city are pressure on housing supply and traffic congestion. Neither of these is easy to overcome and both can lead people to question what they are doing there. So we need to ask what would encourage these people to move here and contribute to our economy and our communities. It should go without saying that these people would seek a reliable and resilient way to ship their goods elsewhere around the country and world. They would want surety around power and water supply. But these are things that people in all communities aspire to have and are hardly a point of difference in a competitive market. If someone’s motive for moving from one place is related to their perceived quality of life in that location then this factor will be important to them when deciding on where they go. We have a relatively compact, walkable central business district, we have large areas of industrial land in close proximity to State Highway One and a deepwater port and we have a variety of wonderful residential areas that suit a range of lifestyle choices. There is possibly some negative outside perceptions about Whangarei and possibly the lack of amenity to encourage inner-city living. This is why the work that the Whangarei District Council is doing in the place making projects and their “Love It Here” campaign are so important. There is opportunity for the community to participate and contribute to this work and ensure we can fulfil our district’s potential.

LEADER COLUMN DECEMBER 2011
It has been another tough year and many Northland businesses have continued to struggle to maintain their market share or to grow their business. We have a relatively small population and a comparatively low regional GDP which means there is only so much money in Northland that people can afford to spend on goods and services. . As reflected in the recent Chamber of Commerce Northern Region Business Confidence Survey while both our population and economy will grow in the future this growth is likely to be slow and consumers are likely to remain cautious

This does not mean there are not opportunities for businesses to grow, only that this growth may require the owners to look at new ways of doing things. On the positive side with Whangarei being the first New Zealand town to receive Ultra-fast Broadband and Northland also well placed to benefit from the Rural Broadband Initiative, there is potential for Northland businesses to both increase markets and reduce their day to day operating costs.

There will be potential costs in initially adopting this new technology. This will come through connection fees, software development, hardware upgrades and just general costs associated with businesses changing the way they operate. How this will be done will vary depending on the nature of particular businesses and the willingness of their owners to adopt new ways of doing things.

While these costs may make some Northland businesses reluctant to adopt UFB, there are a number of things that this technology would enable them to achieve that they cannot do at present. Northland businesses are virtually exclusively very small enterprises and operating with a limited somewhat isolated market. Fast, reliable data transfer can overcome lack of scale and location. The Whangarei retailer need no longer rely just on those local customers who walk into their shop. There are now almost 2 billion people worldwide connected to the internet. Through innovative marketing local businesses can enjoy access to a large portion of this market.

They can reassess their communication systems and there will be a number of savings small businesses will be able to make in this area. Also through the use of “cloud” technology it will make financial and customer management systems that were once the exclusive domain of large corporates available to small businesses. While this new technology may not be right for all businesses, it is surely worth any business taking the opportunity to explore ways to reduce their operating costs and increase their market share.

LEADER COLUMN FEBRUARY 2012
Several recent articles in national newspapers have once again highlighted the opportunities that could exist for Whangarei because of its location in close proximity to New Zealand’s largest city. Obviously there is potential for our deepwater port to benefit in the future as Port of Auckland meets its capacity, struggles with reverse sensitivity and considers whether storing several hundred thousand containers is the best possible use for a world class city. But it is more likely that it will be issues around quality of life and the challenges of living in a large metropolitan centre that may make Northland attractive alternative to Aucklanders in the near future.

While not wanting to view Whangarei through rose coloured glasses and recognising that we still have a number of issues that need to be resolved, we do have a lot to offer those disaffected with living in an overcrowded city with an infrastructure stretched to near capacity. Two factors that could potentially affect the quality of life of people living in such a large city are pressure on housing supply and traffic congestion. Neither of these is easy to overcome and both can lead people to question what they are doing there.

So we need to ask what would encourage these people to move here and contribute to our economy and our communities. It should go without saying that these people would seek a reliable and resilient way to ship their goods elsewhere around the country and world. They would want surety around power and water supply. But these are things that people in all communities aspire to have and are hardly a point of difference in a competitive market. If someone’s motive for moving from one place is related to their perceived quality of life in that location then this factor will be important to them when deciding on where they go. We have a relatively compact, walkable central business district, we have large areas of industrial land in close proximity to State Highway One and a deepwater port and we have a variety of wonderful residential areas that suit a range of lifestyle choices.

There is possibly some negative outside perceptions about Whangarei and possibly the lack of amenity to encourage inner-city living. This is why the work that the Whangarei District Council is doing in the place making projects and their “Love It Here” campaign are so important. There is opportunity for the community to participate and contribute to this work and ensure we can fulfil our district’s potential.

ADVOCATE COLUMN 3rd WEEK JANUARY 2012
New Zealand Chambers of Commerce Northland has a wide range of resources available to assist start up businesses avoid many common pitfalls and is also a partner in the Regional Business Partnership whose objective is improved business capability for Northland businesses. Over the last months of 2011, New Zealand Chambers of Commerce Northland received a number of new membership applications from start up businesses.

At the time I thought why anyone would want to start up a new business given the tough economic times we had been experiencing over the last 18 months or so? Yet upon closer examination there are probably a number of good reasons why you would consider starting a business during a recession. It is also likely that the events of the last two years will influence management practices of these businesses long after the recession is over.

Statistics show that while there are currently more businesses exiting the market than entering, there will always be those who wish to start a new business. In some cases recessionary times put people in a position where they feel that by starting their own business may be the best way of providing some financial security. This is supported by overseas studies which show areas of high employment will generally exhibit higher levels of stat up businesses than those of low unemployment.

Then will always be entrepreneurs who have an aspiration and the energy to take on new challenges and many successful companies have their origins in recessions. The increased churn as businesses are forced from the market provides opportunities for others to offer products and services more efficiently and innovatively. This does not mean that their chances of success will be any easier but it may mean that the new business owners will develop traits different from those who started their businesses in a more buoyant market.

One possible legacy of the last two years may well be a new breed of managers. These people will be operating in an environment that requires disciplined financial management skills if they are to be successful and a high level of business capability. Yet history has also shown that managers who have begun their careers during recessions are risk averse and took on less debt. While this in itself is not a bad thing it does mean that they have also been shown to invest less in research and development. This may lead to slower growth and less innovation than has been experienced in the past.

ADVOCATE COLUMN 1st WEEK FEBRUARY 2012
Last year during the debate regarding the North Auckland rail link and whether it should retained, one of the arguments in support of its retention was the fact that at some stage in the future it may be needed and that the cost of reinstating a “mothballed” line would be prohibitive. Of course it is hard to argue based on what may or may not happen in the future but perhaps the reality is that there is already evidence to support the retention of this strategically important infrastructure based on the current state of New Zealand’s maritime industrial practices.

In recent times the Port of Auckland has been involved in industrial disputes that may of may not have directly resulted in it losing business to Tauranga. At the same time their plans to expand their area of operations has also caused many Aucklanders to ask whether this is the best use for this land. What was particularly interesting about the conversations taking place around the Port of Auckland and their current productivity levels and their planned expansion, was the fact that over a quarter of the containers landed there are trans-shipments. This means that almost 350,000 containers which are unloaded at Auckland never actually leave the port by road.

There is no argument that the Port of Auckland is a substantial contributor to that city’s economy and that it will continue to grow. However many commentators believe that at some stage in the not too distant future neither Auckland nor Tauranga will have sufficient capacity to meet demand. If this is the case then perhaps we really do need to ask whether the locking up a large portion of land in our largest city and severely reducing the recreational facilities for which the city is known is such a good idea given that there is a suitable deep water port with virtually unlimited storage capacity within 200 kilometres.

This goes beyond what is best for an individual region or city. A highly productive deep water port at Whangarei working to its potential capacity, supported by the necessary infrastructure to integrate it with the northern land and marine transport networks is essential to creating a resilient supply chain that New Zealand’s economy needs if it is to be competitive and productive. This is just one example of the role Whangarei can and should play in the wider national economy and also the danger in dismissing the transport link between our two centres as nothing more than a tourism opportunity.

ADVOCATE COLUMN 1st WEEK DECEMBER 2011
Based on recent Treasury forecasts, it seems almost certain that economic growth will remain low for the foreseeable future and that there will an almost no rise in labour productivity for the next decade or so. Yet while this may not be a particularly satisfactory prospect, there are some New Zealand companies that are performing in a manner that defies this forecast.

These companies occupy a niche international market and are involved in ICT, high tech manufacturing and the bio-tech sectors. They also operate largely unnoticed by the wider community. It shows that what many economists having being saying about our creating economic growth is true. That is that to grow our economy and increase our productivity requires innovation and the identification of those international niche markets where our comparative lack of size can actually be a competitive advantage.

If not already these companies are fast becoming our biggest export earners and make a lie of the statement that New Zealand cannot compete globally as a manufacturer and exporter. We have an innovation sector worth $7 billion a year, contributes $5 billion per annum of exports and yet is largely based around only a handful of companies.

New Zealand cannot compete with many other manufacturing countries that focus high volume and a low waged work force and nor should we. To grow our wealth and raise our GDP will require a shift to a high wage economy. This is the ground that our successful manufacturing companies are currently occupying. These companies are involved in manufacturing things of high value by weight and that have a high profit margin. Yet conversely we as a nation continue to focus on low waged activities and our natural resources.

New Zealand business people in general like to maintain a low profile. Because these businesses operate below the radar of the domestic market it can at times be difficult to extol their virtues and offer them as an example to future young talented entrepreneurs as a possible pathway to success. This is compounded by the often bizarre or specialised nature of the products they manufacture.

These businesses show that our location and population base are not in themselves barriers to a successful manufacturing enterprise. We have a physical environment and on occasion a lifestyle that can be attractive. What is needed is to ensure that we create a social and commercial environment that encourages innovation and values excellence in research and development.