Australia: a springboard to international success

Australia is New Zealand’s most important international relationship, with two-way trade worth $24 billion a year. It is New Zealand’s largest market for services exports worth $4.1 billion and our second-largest market for merchandise goods, at $8.9 billion.

Australia is also New Zealand’s largest source of foreign direct investment. More than 85% of companies working with NZTE [New Zealand Trade & Enterprise] export to, or have a business presence in, Australia. For many New Zealand businesses, the Australian market represents their largest non-New Zealand business activity.

For New Zealand businesses seeking to grow internationally, Australia offers scale, cashflow and a springboard to multinational engagement. For many New Zealand companies forging business in developing markets, Australia provides the cashflow to continue their outreach.

Australia has a changing macro environment, led by a drive for improved productivity and efficiency. This change creates ideal conditions for New Zealand companies to maximise opportunities through leveraging New Zealand’s reputation for offering high-value goods and services, coupled with our agility and innovation.

Feedback from a number of large Australian businesses shows there is a real respect for the New Zealand economy and what New Zealand businesses have done to adapt post-GFC.

Elsewhere, market engagement through acquisition is a real opportunity, given AUD/NZD exchange rates.

These drivers - along with Australia’s proximity, a comprehensive free trade agreement, fast customer feedback and ethnically diverse niches - provide compelling opportunities for New Zealand businesses.

While Australia’s economy has come off a high as its resource sector growth flattens, it continues to offer opportunities. For New Zealand businesses engaged in health ICT, resource and value-add food and beverage, this is a great time to be selling cost-efficiency and innovation to Australia.

There are numerous successful examples of New Zealand businesses leveraging engagement with Australian-based companies to expand their international footprint. Recently, a New Zealand food and beverage product was listed in Costco Australia only to be taken throughout Asia and North America by the giant chain.

Our sector-focused projects in Australia this year include a New Zealand Health Showcase featuring some of New Zealand’s top health ICT companies presenting to Australia’s health industry in New South Wales, Queensland and Victoria. We have formed a new partnership with York Butter Factory (a digital co-working space based in Melbourne) and we are inviting New Zealand companies to apply to work out of this office next to other digital start-ups. Three New Zealand companies took up this opportunity in February and we are looking forward to making more spaces available this year.

NZTE is helping customers to achieve market penetration, sustained growth, profitability and an understanding of the commitment required.

Top tips

• We’re not the only ones seeing Australia do well, and as a consequence it is a tough, highly competitive international marketplace, where underperformers are quickly found out.
• Treating Australia as one big ‘blob’, rather than as a collection of independently minded states and territories, can mean leaving opportunities, and money, on the table.
• Don’t take the Australian market for granted or treat it as nothing more than a slight extension to a domestic business. While we share many similarities, our respective size, labour market and regulatory environment are quite different.
• For those who do make the commitment, the potential upside is significant: a marketplace of affluent, savvy consumers.

Find out more about the market at www.nzte.govt.nz/australia.

This article reproduced with the kind permission of New Zealand Trade & Enterprise (NZTE). To read the original article, click here.

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