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2. Expanding a Business

Why Expand to New Zealand?

Why? Well, first of all because starting a business in New Zealand takes three days and according to an authoritative source it is easy like shooting fish in a barrel! The source is nothing less than the World Bank, which praised New Zealand as being the most business-friendly country in the world, even more than Singapore, ranked second. Obviously it is not just a matter of time and easiness. New Zealand is a breath-taking country on the top of every British tourist priority destination and also an efficient, sophisticated and active economy capable of delivering key benefits to investors.

New Zealand is located in the South Pacific Ocean to the southwest of Hawaii and southeast of Australia. It holds the key to access the promising Pacific Islands markets. It is similar in size to Britain and has a population of just over four million. Low population density, lack of pollution and varied geography offer exceptional quality of life and intriguing conditions when it comes to expanding a business in New Zealand.

New Zealand experienced a history of isolation, but that chapter is definitely over. The nation is now connected locally and globally by highly efficient communication technologies. Logistic efficient ports, a range of global airline service and high-capacity submarine fibre-optic cables should place this country at the centre of the attention for British companies which are expanding, setting up or licensing a business in New Zealand.

The economy of the country is mainly based on the exports of traditional goods such as agricultural products (wool, meat, dairy products, forest products, fruit and vegetables, fisheries) towards Australia, USA, China and Japan. The entire economy is strongly dependent on international trade. However, many sector are expanding and offer promising business opportunities for entrepreneurs thinking about expanding or incorporating a business in New Zealand.

What's the attraction for a UK Business?

New Zealand and UK are antipodal only in a geographical sense. Around 80% of New Zealanders claim at least some British ancestry and British visitors and businessmen expandin a business in New Zealand usually feel at home. Still part of the Commonwealth, New Zealand shares legal system, business etiquette and financial standards with the UK. It already imports a wide range of British goods and services, particularly in the agriculture, automotive, biotechnology, creative industries, education, food and drink, giftware, healthcare & pharmaceuticals, ICT, marine and publishing sectors.

Moreover, New Zealand signed an important trade agreement with the Association of Southeast Asian Nation, which is expected to boost the local economy accompanying the country out of the recession. ASEAN is an economic partnership of ten countries: Indonesia, Malaysia, the Philippines, Singapore, Thailand, Brunei, Burma, Cambodia, Laos and Vietnam. According to the New Zealand Ministry of Foreign Affairs and Trade the new agreement with ASEAN would boost GDP across the countries by more than US$48 billion over the period 2000-2020 with an additional US$3,4 billion to New Zealand alone. New Zealand has also signed also a free trade agreement with China.

The local market is highly deregulated and guarantees to companies expanding a business in New Zealand stability, extensive free trade and active government support for investments. This open and competitive economy is also corruption free. The local community is well educated, reliable and famed for its creativity. Someone calls it the New Zealand advantage. Someone says: Kiwi know how. In one way or the other, they don't mean it only for rugby.

Business opportunities

The New Zealand's main industries are:

• tourism (highly profitable)

• agricultural export (highly organized)

• small manufacturing and high-tech components

• hydroelectric power and reserves of natural gas

• other manufacturing sectors (slightly in decline) such as car assembly, food processing, metal fabrication, wood and paper products

According to Investment New Zealand, the national investment promotion agency, the most fast-growing sectors which companies starting a business in New Zealand should consider are:

• Biotechnology - New nutritional and therapeutic products, research in forestry and agriculture

• Creative Industries - Screen Production, partnerships for innovative screen production industry.

• Information and Communications Technology - New Zealand is known to deliver commercial success thanks to cutting edge research and applications. Many multinational (Symantec, Allied Telesyn Group, EDS and others) already profit from partnerships in the country.

• Food and Beverage

Lower costs, expertise and a strong focus on costumer needs should be considered when expanding a business in New Zealand in low risk investments.

According to UK Trade & Investment, an UK agency that encourages overseas investments, other business opportunities for companies thinking about licensing, incorporating or registering a business in New Zeland may arise in the education, giftware, marine and publishing sectors.

When seeking for a base for your operations, have a look at Wellington, the capital city. It is the seat of government and a major port. A second option is Auckland (with a population of around 1.3 million), which is the largest industrial and commercial centre, with a major port and the main international airport in New Zealand. Christchurch (population around 382,000) is the major centre of the South Island served by an international airport and the large port of Lyttelton. The city has an increasing output in science and technology and is an important agricultural, industrial and trading centre. Other potentially interesting smaller cities are Hamilton (197,300), Napier-Hastings (122,600), Tauranga (116,000) and Dunedin (114,900).

Challenges

The New Zealands market is mature and can be tricky. The country has a world-class profile in many sectors and new investors should make sure they match high-profile requirements. Avoid improvisation, but if your business plan is robust and your idea is good go for it!

In a busy small country, competition can be harsh in particularly crowded sectors. New Zealands public is famed to be generally brand conscious. The introduction of a brand new product could require long and costly advertising campaigns. Due to its location, delivery costs can also be high.

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