The Profit Spring 2011 Issue

Page 1

SPRING | OCTOBER -DECEMBER 2011

THE

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Inside

PRO features 7

Pro Q & A: Wayne Wooten

8-11

Young Blood in the Bay

12-13

Local MPs outline election goals

16

Business community backs Black Sticks

19

Surviving in the country

24-29

Hawke’s Bay A & P Mercedes-Benz Wine Awards

36

A stroke of genius for ex-rower

7

8

12

16

PRO experts 20

PRO IT by Wray Wilson

21

PRO Sales by Brett Burgess

30

PRO HR by Sue Whiteley

31

PRO Primary by Brent Paterson

19

20

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PRO Biz advice by Cedric Knowles

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W I N E AWA R D S

SILVER

41

PRO Finance by Nick Stewart

42

PRO Customer by Dr Virgil Troy

44

PRO Property by Paul Harvey

45

PRO Legal by Emma Dawson

24

30

36

PRO regulars 4-5

PRO HB – what’s happening in the Bay

37

PRO Motoring – Damon Harvey reviews the Mini Countryman

46-47

PRO Out and About – photos of key events

48

PRO Diary – upcoming events in Hawke’s Bay

37

46

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Editorial

A WORD OF ADVICE... ASK THE RIGHT QUESTIONS Successful local business and community leader John Newland provides a great perspective for any budding business superstar on how to get to the top. One of the keys to success is asking questions of others thus learning from other peoples’ experience. By John Newland

In this issue of The Profit we feature the up and comers in the Bay ... those who are set to become the next generation of leaders. So before you go and read the Young Blood story – perhaps its worth reading this from John. Being in the presence of a successful person and asking them questions is possibly better than reading someone’s autobiography. One thing I notice is that we so called “professionals” tend to have arrived where we are through a range of experiences that presumably we have learnt from. Another thing I notice is that as we get older, we become more confident and can start to assume that others will benefit from listening to us share our respective wisdom. I see some truth in that but suggest that the way we go about creating the opportunity for sharing is very important. Part of our value as individuals is our ability to add value to the lives of others. In my view, too many people fail to recognise this in relation to others and particularly to people in their formative years. I am not talking here just about developing up and coming professionals. It is a bigger issue than that. Before you can become a confident and successful professional, you need to be confident and focused. Good parenting is very important. But this alone will not produce a confident individual. A good education is important but this may successfully impart knowledge yet fail to instil confidence. A lack of confidence is the most limiting factor affecting the ability of an individual to achieve their potential. A high level of intelligence, broad knowledge or a practical skill set, do not necessarily result in confidence.

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Don’t assume that people who appear to be doing well, are actually happy with where they are at. Many people we come in contact with can benefit from having the opportunity to pick up on the learnings of professionals. What is critically important is the manner in which we choose to share our perspective.

confidence in achieving. Once this information is shared we are in a position to work out how we support, enthuse or in fact find a vision for the person to focus on. It’s important that everyone has a goal and a direction of travel. That probably sounds just too obvious and most of us don’t know our potential

The questions we ask need to be those with a potential to show that we are interested and supportive, not just ‘nosey’. John Newland

The last thing that is required is some condescending ‘older person’ lecturing the supposedly keen to learn. There is no value in imparting knowledge or sharing experiences with someone who is not really interested or capable of understanding the message. This is why I believe the most important thing we can do is ask questions. If we ask questions we get people to talk with us, rather than listen to us. We get to know their priorities, aspirations, passion and self belief. It is only after developing an understanding of these things that we can have any idea about the relevance of what we may have to share. Anything we have to share needs to be a reinforcing or a redirection of a perspective that has been highlighted to us. It’s all about them. Not about us. The questions we ask need to be those with a potential to show that we are interested and supportive, not just ‘nosey’. Leading questions like ‘what do you expect to be doing in 5 years’ time?’ or ‘what would you like to be doing in five years?’ are a good starting point to highlight direction of travel and the

OCTOBER - DECEMBER 2011

Do you realise how many people struggle to find support within their family or even at their place of work? If we are in the right place at the right time and have the right attitude, we can help with this. How can we determine if the time is right? By asking questions. And do not limit this to kids as you think of them. At my age, kids can be anyone under 50. So do not waste the opportunity to add value to the lives of those with whom you come in contact. The process you use for this is important. You need to be sure to have these conversations on a one to one basis and not raise the issues in a group. That can be just too intimidating. The tone of voice is very important. We need to be supportive and encouraging and certainly not critical or dominating. Once you have had the opportunity to establish a relationship of trust and support, then I encourage you to make the effort to continue the association. This can be very casual and informal or at least appear to be. It requires focus and commitment. Lastly we are never too old to benefit from asking questions to enhance our own learnings or understandings.

I always think a good meeting is one that I have come from, having changed my view on something, because my awareness has been enhanced. As we get older there is a big risk that we think we have done it all and know it all. We need to keep learning and this often means we just need to listen with an open mind. However, there is more to learn if we take it a step further and ask questions. So my message is to be aware at all times, of the value in asking questions. This is either to enable you to assist others on their life journey or in fact, to move forward on your own. There are much more important questions to be asked than “Will you have fries with that?”


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Hawke’s Bay

Hotel for Hastings

Retail Activity Update

A boutique hotel for Hastings is a step closer following an announcement by Gemco Group Holdings.

Hastings - The CBD has seen a surge of investment in retail property in the past 18 months with several high-profile developments putting the city on the national radar.

Land opposite the Hawke’s Bay Opera House precinct is earmarked for the hotel. There have been high hopes of a hotel in Hastings for some time to further market the growing number of conferences and events at the opera house facility. Gemco managing director Darren Diack says since the announcement there has been strong interest from national hotel operators. The 36-room hotel will accommodate

80 to 120 people. It is expected to contribute towards the revival of the city centre. It would include a floor area of 1024sqm and will spread across three levels with 16 car parks. Darren said he was looking for a hotel operator to lease or buy the hotel

once it was completed. Opera House general manager Roger Coleman says:“This is something we believe visitors to Hastings will embrace, a high-end, central boutique hotel located a stone’s throw from the opera house and the city’s restaurant and night life.”

Retail occupancy rates in Hastings have continued to improve since early 2009 with the latest figure of 97.3 per cent the highest since 2002, (Logan Stone research). The new 6000sqm Farmers building on the corners of Heretaunga and King Streets is progressing well. The current Farmers for Home store in Heretaunga St has been purchased by Wallace Development and is expected to be converted into smaller fashion-based retail offerings. Freedom Furniture has moved to a new 1200sqm site in St Aubyn Street and Dankse Mobler has opened in the former Freedom store site in Heretaunga Street. Napier - Interest in Napier’s core retail precinct remains buoyant.

as they necessarily inter-relate, suggesting paths forward in each area.

A Better Hawke’s Bay Business and community leaders are leading the charge for an independent study on the performance of Hawke’s Bay.

Over 600 people throughout Hawke’s Bay have called for the regions five councils to undertake a collective study which will look at the economic performance, social well being and governance in the region.

Sets forth aspirational goals for the Bay’s economic and social development, with specific attention to how improved local governance structure and processes can help achieve these goals.

Presents truly independent findings and conclusions, with no patch protection or pre-ordained outcomes. Assuming the active participation of all councils, iwi and other key stakeholders, the study must nonetheless be be developed by an independent party with final responsibility for its contents.

The group started a full scale advertising campaign to get the community to support the study. A Better Hawke’s Bay is urging councils to adopt a study that: •

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Examines economic, social and governance challenges

OCTOBER - DECEMBER 2011

A website has been set up www.abetterhawkesbay.co.nz

Wild Spirit, a NZ-owned outdoors gear store, is moving into lower Emerson St and the Bowman Building in upper Emerson St has been leased. A new ice cream parlour has opened at the side of the Art Deco Masonic Hotel and a delicatessen in Civic Court and a café in Dalton Street are opening soon. The Tennyson is being refurbished. The Paxies building has sold while The Music Machine has moved to Hastings St and Boardzone to Emerson St. The Fetch SPCA store has expanded and Adoro Café has relocated to the opposite side of Hastings St. Bed Bath and Beyond has moved into Ocean Boulevard and Green Revolution Clothing is set to open in Dickens St.


PRO

Hawke’s Bay

Data storage centre for Hawke’s Bay Hawke’s Bay will be one of the first regions to have a data storage centre due to the roll out of the ultrafast fibre network locally. National company Virtual Infrastructure Professionals (VIP) is investing $250,000 to provide local businesses with cloud hosting services. VIP managing director Lance Warren says the initial data storage centre will be based at Unison’s head offices in Hastings and the company is currently identifying sites for a permanent 2.5 tier or more data storage facility in Hawke’s Bay. He said this was on the back of UnisonFibre laying over 140 kilometres of fibre optic cable. “Fibre to businesses is well advanced and one of the major

Apples turn liquid gold

benefits is cloud storage of data. “Because of UnisonFibre’s considerable investment and roll out of fibre, we’ve accelerated our plans and given Hawke’s Bay higher priority and set up a highly secure data storage centre,” Lance says.

Once a by-product, process-grade apples are becoming liquid gold for hard hit New Zealand growers. ENZAFOODS has invested in a new $4 million processing line at its Hastings site to produce premium added-value fruit products adding another 14 jobs.

VIP plans to set up 17 data storage facilities throughout New Zealand. Locally Brett Rawlinson (pictured) will head VIP and he’s buoyed by strong interest for the range of services. The company is marketing an entry level internet and phone plan for $279.

“Rather than ripping out trees, growers are signing ‘Grow for Process’ deals that on a per hectare basis are returning profits for varieties that are returning losses in the export market.

The Park Megacentre opens The first two anchor tenants at the new The Park megacentre in Hastings have opened. A blessing ceremony was held to officially recognise The Warehouse as the first retail store to open at the former Nelson Park site in late September. The second anchor tenant, Mitre 10 Mega, opened in mid October. Owner and operator of Mitre 10 Mega Stephen Ricketts says the move is a significant development for the company which only opened its Mega store in Hastings in 2004. The new site at The Park will be about 12,000sqm, the largest retail warehouse in Hawke’s Bay and among some of the biggest in New Zealand.

Business Awards The Hawke’s Bay Today Business of the year will soon be known. The Westpac Hawke’s Bay Chamber of Commerce Business Awards is at the finalists stage, with all 40 finalists across nine categories meeting the team of judges. The awards will be announced at a

ENZAFOODS general manager Jon Marks said by pureeing and dicing apples, ENZAFOODS has created huge demand for premium value-added fruit products under the Freshfields brand that is delivering profitable returns to growers.

The new line will produce organic and conventional apple puree for baby food, apple sauce and other food ingredient uses. Ahead of next season’s production it will be expanded to include a diced apple pouch pack line, which is used in the bakery, food service and industrial markets in Australasia and Asia.

gala awards ceremony at the Hawke’s Bay Opera House on November 3. The general award categories are The Barnes Mossman Small or Emerging Business; The Unison Small-Medium Business; The Newstalk ZB MediumLarge Business and The Pan Pac Large Business.

Regional Council Business Innovation; Watties Workfit Healthy Workplace; Te Puni Kôkiri Mâori Business Excellence; Xplore.net Online and Export Hawke’s Bay Exporter of Year.

Specialist Categories are EIT Not for Profit Business; The Hawke’s Bay

Adding value to successful community projects

million stunning Hawke’s Bay Opera House

Over $7 million in funding secured for the Len Lye Centre in New Plymouth

$6

million government funding for the Hawke's Bay Museum & Art Gallery

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Feature

FRUIT GROWERS FOCUS ON AUSSIE MARKET

The World Trade Organisation (WTO) has opened the gates for Kiwi growers to send their apples across the ditch but how long will it be before the Aussies accept its decision? By Lawrence Gullery

Pipfruit New Zealand hopes its growers will have a bigger focus on Australia this coming harvest season to take advantage of the unlocked export market across the ditch.

Australia because the volumes are too small.

time the Aussies aren’t just going to roll over and say ‘ok, you can come in’.

“We will need to see how many packers and exporters put their hands up for the 2012 season before making a decision on whether we are going to try and get any marketing and promotion strategy in place,” Peter says.

“Australian’s don’t work like that and we had anticipated the current resistance to the WTO decision.”

PNZ chief executive Peter Beaven says the “modest volume” of apples exported to Australia earlier this year involved just four packhouses and six growers from Hawke’s Bay.

“There is some level of apple leaf midge around and growers will have to be selective about what box of fruit they put up for us next year. “I am hoping things will get better and that people will have Australia in mind when they are organising their production this coming season.” Peter says it is important the two countries work closer together, not only for trade but also for the development of the industry internationally.

Peter Beaven

The apples went into wholesale markets in Melbourne, Sydney and Brisbane.

“When that calms down, people will get used to trade taking place.” At the moment there is no major marketing plan for Kiwi apples into

“It’s been 90 years since we had apples in Australia and after that amount of

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“Basically they are going to throw up any barrier they can find. I smile when I hear that some

He’s also heard other stories which tell of threats to “lock up containers of our apples and torch them” when the fruit arrives in Australia because of fears of the spread of fire blight. “There are minor instances of fire blight in the regions every now and again but not every year. “Science has proved time and time again that fire blight can’t be

It’s been 90 years since we had apples in Australia and after that amount of time the Aussies aren’t just going to rollover and say ok, you can come in Peter Beaven

“There are some programmes we work on together with Australia, such as with the Pink Lady variety and it is only a matter of time before we take the view that we are a trading base for the rest of the world.” Hawke’s Bay Fruit Growers’ Association president Leon Stallard believes it could be a few years before Australians philosophically accept the World Trade Organisation (WTO) ruling to allow New Zealand apples into their domestic markets.

“What we are finding is that there are still hurdles and there’s bound to be a bit of political heat at the moment,” Peter says.

Leon says Hawke’s Bay already has a successful apple export market to other countries and it is just a matter of perseverance to crack the Australian market.

“But they are the same supermarkets that operate here, and that Kiwis support.”

OCTOBER - DECEMBER 2011

of the major supermarkets in Australia are not going to take our apples to back the Aussie growers.

transported by apples and that is the science considered by the WTO to make its decision.”


PRO

Q&A

WAYNE WOOTTON Wayne Wootton is the business development manager at the Hawke’s Bay Airport. The gateway for the region is undergoing a transformation with a runway extension completed to cater for jet capable planes while a business park is also earmarked. It will be Wayne’s role to lure another carrier to the Bay and to attract businesses to the 20 hectare business park. Anna Lorck talks to Wayne Wootton

experience in business development, commercial acumen and client service management.

Another focus area will be the construction of Stage one of the Business Park. With money already

With its glorious climate, fertile land, affordable housing, good food and wine, an abundance of sporting activities and the famous Art Deco architecture, what better place is there to settle. Wayne Wootton

What are your initial observations of opportunities for Hawke’s Bay? I truly believe the region has a lot to offer and I would like to see the Bay not only as an up and coming major New Zealand tourist destination, kicking on the heels of Queenstown, but also a place to relocate your business or family.

What’s your background? I am a Chartered Civil Engineer by profession and have worked in both public and private sectors as a client, consultant and contractor. Prior to emigrating to New Zealand in 2006, I ran my own company in the UK for 15 years but, seeking a major lifestyle change, moved to glorious Hawke’s Bay to take up a senior managerial position with a global engineering consulting company. Over the years I have not only developed skills in leading high performing teams but have also gained extensive

With its glorious climate, fertile land, affordable housing, good food and wine, an abundance of sporting activities and the famous Art Deco architecture, what better place is there to settle.

What are your first tasks in your new role? Developing a long-term strategy around client service management is one of the keys to a successful business. A main priority will be to establish and strengthen working relationships with the company’s clients and in particular Air New Zealand, whilst growing the client base and potential of a second major carrier.

earmarked for the first section of access road, getting the design and construction under way will be of major importance. The growth of the airport’s property portfolio will become more apparent as the business park gets underway, however, initially I’ll be looking at ways of enhancing the passenger and visitor experience in the terminal.

Who do you see as the airports most important stakeholders – as you aim to grow the airports business? Obviously, the staple business of the airport is aviation, with Air New Zealand our major client. Strengthening this relationship is paramount and I’ll be working with the airline to investigate scheduled services to other domestic destinations as well as potential increases in frequency to the major centres. The staged development of the business park within the airport confines will see

a new venture and perhaps a move away from aviation. Here, there will be the opportunity to establish relations with a variety of stakeholders and I am looking forward to plenty of discussions with potential clients. Of course, one very important group of stakeholders is the people of Hawke’s Bay. Having been warmly welcomed since arriving here and having now made the Bay my home, I am keen to give something back to the community and will relish the challenge of driving forward the growth of the airport and securing its position as a pivotal part of Hawke’s Bay’s infrastructure.

If you could crystal ball to 2016 – what would the airport’s business look like? Having an enthusiastic and positive can-do attitude, I am very excited about what the future holds. 2016 is not too far away and to make major in-roads will take time, however, there are short-term goals that I hope will come to fruition. The development of the first stage of the Business Park, giving the airport a sense of identity which represents the best of what Hawke’s Bay has to offer and progressing towards another airline are all well within reach. As for international flights, well this could be on the horizon but the main priorities are the domestic market and ensuring the sustainable growth of the airport over the coming years.

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Bay. nt in the le a t s s e g busin nd comin a p u f o y he best. lent h six of t it w There is p p u s t catche Lautour Kate de The Profi ullery & By Lawre

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percent pure organic cotton brand is paramount for Catherine and she’s taken it one step further by being one of only a handful of New Zealand businesses to join an environmental programme called “1% For The Planet”.

Catherine Hawkins

“As members we pledge one percent of our annual turnover to local environment causes and in Hawke’s Bay I’d like to use that money to set up a scholarship, or use it to donate trees or even organise a Pureborn project, cleaning up beaches locally.”

We are very much technology driven and looking forward to fibre. Our Sydney office is online with our Napier office and when we get fibre it’s going to improve our links. Matt Harrison.

CATHERINE HAWKINS Pureborn Organics Catherine Hawkins is testament to the hard work required to kick-start a new business into action. The former Aucklander was ‘knocking on doors’ of potential stockists for her new baby clothing label, Pureborn Organic, up until the day before her second son was born. “I was on the road a lot then and was showing the range, evolving the range, listening to what the market wanted and making those changes. “I think with any business, your plan constantly changes and evolves. I started the business as an online company only because at that time I only wanted to work part time but obviously that has all changed now.” Pureborn Organic’s point of difference is that its products are made from 100 percent organic cotton, which means there are no fertilisers, chemicals or pesticides used to grow the cotton to make clothes for the label. The clothes are made in India in a ‘sweatshop-free environment’ and carry the Global Organic Textile Standard which is recognised as the leading processing standard for textiles made from organic fibres. Catherine, a marketing specialist who ran her own consultancy in the UK, spent a year planning the business and launched it when she and her husband, a Hawke’s Bay man, moved their family to the Bay to live in 2008. “I had my first son when we were living 8

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in Hawaii and I thought I’d like to start my own organic cotton label, bring it into the New Zealand market place at 30 percent price-wise lower than the market leaders.

I think with any business, your plan constantly changes and evolves. Catherine Hawkins

“It was an online business but now I’ve got into wholesaling and supply 60 retail outlets around the country,” she says. Pureborn Organic’s most notable account is Kirkcaldy & Stains in Wellington which is the exclusive stockist of the brand in the capital. “From there I found it easy to roll out to other places. We have expanded our colours, expanded our sizes, our screen prints and our website to handle worldwide orders,” Catherine says. Plans are also in the pipeline to launch a new brand later this year called ‘Loaded Nappy Organics’.

MATT HARRISON EC Credit Control

Peter Beaven

Matt Harrison remembers his first afterschool job entering data for his father who had opened EC Credit Control in 1989 (formally East Coast Credit Control Limited). Over 20 years later, Matt now owns and runs the business his Dad started all those years ago. “Dad had been working in merchant finance when the stock market crashed in 1987. So he looked around for a new business and decided to go into the credit management industry. “I used to come in after school and enter data into the computer, it was a very small operation then, just my father and one other person. I left school, went to uni, and got a job with a local business for about four years, in order to get some experience and I moved into the family business after that. “Dad retired last year so I now own and

run the business 100 percent.” Over the years EC Credit Control has had a few office location changes around Napier. However in 2008 a major investment was made in redeveloping the Market Reserve building on Hastings Street where the business has been based since. The move had allowed the business to further expand. It has 135 staff through New Zealand and Australia, 85 are based in the Napier office. There are also about 15 sales people working ‘on the road’ around New Zealand and another 35 in Australia. “Napier is our head office but we also have offices in Sydney, Melbourne, Brisbane and other Australian locations. Office locations in the UK and Ireland are operated by franchisees,” Matt says. “From Napier, we take all of the calls from Australia and New Zealand.” In New Zealand the company derives most of its business through the SME

“It’s a street style brand. It’s retro, cool and consists of single pieces, t-shirts and body shirts to accommodate the market that Pureborn Organic doesn’t fill at the moment.” Catherine moved into a new shop in Taradale this winter after operating from her home and although she sells products on-site the business remains primarily a wholesaler. The integrity of the product’s 100

OCTOBER - DECEMBER 2011

Matt Harrison


IN CATHER

KIN E HAW

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N ARRISO MATT H OS GDALIN NIC MA D ACLEO SARA M A KYLE DONN SH ON NA BRAND

and corporate markets, whilst in Australia it is aggressively tackling the corporate market after securing the bulk of the SME market. Technology plays a big part in the business’ operations and Matt welcomes the introduction of new fibre into Hawke’s Bay. “We are very much technology driven and looking forward to fibre. Our Sydney office is online with our Napier office and when we get fibre it’s going to improve our links.” Matt has some simple advice to dish out to others looking to start out in business.

don’t under capitalise, take advice from those who are successful in business, take on board their suggestions and use them as your own.”

NIC MAGDALINOS Paris Magdalinos Architects Nic Magdalinos admits it was a “challenging and rewarding time” following the death of his father Paris a couple of years ago, the founder of their family business, Paris Magdalinos Architects.

profile projects at the time across New Zealand and some internationally. “… and the heavy legacy of Paris to ensure that we succeeded. All of our staff performed magnificently, and our greater client base gave us an opportunity to deliver the goods. Nic Magdalinos

In any crisis you need to keep your head and determine the best way to advance.

“The main thing is to do your research, find out what your opposition businesses are doing and how they operate. That will help you establish your point of difference in the market and help you work out how you can be the leader in the industry.

“In any crisis you need to keep your head and determine the best way to advance,” Nic says. “It was an incredibly emotional time for the office as a whole, however it galvanised us and focused our attention.”

Proudly, we can attest to doing that,” Nic says. The business has recorded growth over the past three years despite the tough economic downturn.

“Make sure your finances are right,

The company had a number of high

“... we have done so by deploying the

Nic Magdalinos

plans that we had set strategically, and through being able to review and adapt those plans to suit,” Nic says.

.continued next page

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keep sales up year on year,” Sara says.

“Of course we have had to adapt to the market conditions, albeit I am a bit of an optimist and have sought to realise new opportunities rather than dwell on those missed.” He says it has been important to continue to focus on how “we can better our business”.

“The personal touch is crucial too and the St Beads staff know that when you shop at St Beads it should be an experience that you would like to relive time and time again.” The business’ customers range from children and teens through to adults. Tourists make up a good portion of the customer base, especially during cruise ship season.

It has involved reviewing different markets, continued professional development of staff and investment in technology. “We have also taken the time to reaffirm who we are as a practice and the vision and values we have.” Nic says the architectural industry offers the business to show-off its results through a “building, place or space created”. “As such, we draw great enjoyment upon the conclusion of good projects which work for those whom we design them for.” Nic says the company has some “wonderful projects” on its books in New Zealand and Australia in the near future.

Sara MacLeod

So we decided to creat an e-commerce stie for those not readily able to get to St Beads or who cimply enjoy shopping online. Sara MacLeod

“Locally we are looking at starting on-site with Waiohiki (Marae) later this year or early next. I am pleased to say that we are working on the Farmers redevelopment in Napier CBD, alongside the Paxie’s redevelopment. Both projects are unique in terms of their scale and location as there has been very little development of Napier’s CBD over the past 30 years.

banking on the popularity of customers being able to create their own jewelry.

“We also have the privilege of working with the McKimm family on a significant adaptive reuse project on a wool building in West Quay.”

It turned out to be a good business decision and the shop is now developing a better and brighter site with all of the stock it has in-store.

SARA MACLEOD St Beads Limited Sara MacLeod’s travels overseas more than a decade ago delivered the initial inspiration for her and her mum Sandra to start a jewelry business upon Sara’s return to Hawke’s Bay. “We noticed more and more people wearing designs that were unique and ready-made. We thought it was only a matter of time before New Zealanders wanted to express their individuality in different and colourful ways through jewelry,” Sara says. So they started St Beads Limited in Napier in 2000, 10

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“At the moment teenagers (boys and girls) are really into making bracelets, back packers love creating jewellery using wood/bone/hemp,” Sara says.

Initially the focus of the business was on Hawke’s Bay but accessing a wider base was also important. “So we decided to create an e-commerce site for those not readily able to get to St Beads or who simply enjoy shopping online,” she says.

Sara says she didn’t have a lot of experience in running a business in this particular market when the shop opened but had spent about a month learning different jewellery making techniques and coming up with designs.

“Tourists on cruise ships love New Zealand Paua and anything that has been made in New Zealand and our seed bead section is well used by mature ladies who love spending time creating intricate jewellery pieces.” Sara says her plans for the business include developing the beadsonline. co.nz brand. “The website will offer the next level of flexible shopping options for our client base and it will be an exciting addition.”

DONNA KYLE Cake Stuff

An at-home hobby which grew into a successful online business is now on the verge of moving big time into the international market. Hastings woman Donna Kyle began selling baking supplies and decorations via TradeMe from home six years ago when demand forced her to set up a website dedicated to selling the business directly to customers. The online interest for Cake Stuff prompted a second expansion, from the home garage to a retail shop in Heretaunga St, Hastings. And next year she’s looking to move into larger premises as the business faces its third expansion. “The business has just grown unbelievably. I had a business plan to start off with and recently I sat down with my accountant. We’ve worked out the business has grown by 100 percent in the last year alone. It’s completely outstripped what I had forecast.” Cake Stuff sells a range of baking accessories and decorating supplies for commercial and home bakers, and has almost every accessory customers need for weddings or birthdays. There are only two similar businesses operating in New Zealand, one in Auckland and the other in Whangarei. Donna sources most of her products from the US or England and she roadtests each before deciding whether it is fit for her customers to use. “Initially it was a lot of hard work, sourcing new suppliers and buying products, doing all of the research. “It’s important because our clients cover a range of people, from your stay-at-home mums or young mums wanting to do something for their kids’ birthday cakes to the mid-range hobby bakers and the professionals who

Sandra has a National Certificate in Business Studies and was able to give advice when it came to managing the accounts. The business has had “highs and lows” during the past three years like most Hawke’s Bay businesses. “But luckily with the sourcing of new stock and keeping things fresh and vibrant in store we have managed to

OCTOBER - DECEMBER 2011

Donna Kyle


make wedding and birthday cakes.” Donna believes she owes part of her success in business to the economic recession. “I’ve just hit a niche in the market where the economic downturn means more people are baking at home and that’s where we come in with products. “People want to spend more time at home in the kitchen baking with their kids. It fills up the afternoon with the family together and fills up the kids’ lunch boxes for the next day.” Donna’s business won the Creative Communications Excellence in Independent Retail category at this year’s Hastings City Business Awards. She now has two staff and a parttimer on board preparing for the busy Christmas season. “At the moment we’re sending about 80 parcels of our products to customers around New Zealand a week, and during Christmas it’s more like 15 a day. “As well as that we’d send about six parcels a week overseas, to Australia for example and there are definitely options to operate world-wide.”

Donna agrees setting up the business as a franchise is another avenue to pursue.

Coming to Hawke’s Bay to study made sense and I just fell in love with the place.

“I have been asked several times if I can franchise but we want to get our store into the shape we want it and expand it in Hastings before we look at franchising.”

Brandon Nash

representing the key attributes in each of New Zealand’s main wine growing regions. There are also feasibility studies underway into planting vineyards in India.

BRANDON NASH Dhall and Nash Fine Wines Ltd In the wine business nothing is too much of a challenge for former EIT Viticulture student Brandon Nash. Having established a successful Wellington wine brokerage and distribution company specializing in some of the world’s finest and most expensive wines, Brandon has come a long way fast. Dhall and Nash Fine Wines Ltd employ nine people with a national sales team of six, selling wines to restaurants, hotels, lodges, small independent retailers and private clients.

Brandon is in his third year of the Master of Wine qualification and he’s got a few years to go, but when he finishes he will be one of only a few hundred wine experts in the world able to add MW to their names.

Viticulture course at the EIT in 2003.

He’s recently been back in the Bay, getting experience as an associate judge for the Hawke’s Bay A&P Mercedes-Benz Wine Awards.

Brandon was snapped up by Craggy Range, working in their, then new, Cellar Door. In 2005 Brandon was awarded Cellar Door Personality of the Year by the Hawke’s Bay A&P Mercedes-Benz Wine Awards committee.

All in all quite an achievement, considering Brandon only completed his degree in 2005. With a history of working in bar management and wanting to know more about how wine was grown, Brandon enrolled in the Bachelor of

Recently Brandon and business partner Puneet Dhall branched out, creating their own wine label Bohemian,

Brandon Nash

“I had been living in Wellington and visiting the Martinborough vineyards but coming to Hawke’s Bay to study made sense and I just fell in love with the place.”

“It gave me further confidence as a wine communicator and it helped to beef up the CV.”

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MPs TAKE THEIR MARKS FOR ELECTION RACE

Hawke’s Bay’s incumbent MPs - Chris Tremain, Craig Foss and Stuart Nash are put to the test as the 2011 general election looms. By Lawrence Gullery

1. What is going to set this election apart from previous campaigns you have been involved with? Craig Foss: The main difference for me will obviously be that we are in Government this election, not opposition. But I am still the same positive, friendly, family guy who the people of Tukituki elected in 2005. I am looking forward to continuing to build an even better Hawke's Bay. I have worked as hard as ever in and around Hawke's Bay and Backing the Bay in Parliament. It seems appropriate that my first election as a Government MP coincides with our winning apple access to Australia. Chris Tremain: The big difference is that we have a strong track record as a Government. Having navigated New Zealand through the recession and our country's biggest natural disaster, voters have the opportunity to assess our performance on our actions as opposed to our promises.

Stuart Nash: John Key said this election is a mandate on the sale of state assets. So for the first time in a while we have the two major parties espousing diametrically opposed political philosophies: one for state asset sales and the other, Labour, proposing to reform the tax system and retain the state assets in public ownership.

finances back into line after the debt chaos created by the previous Government. Companies such as HeinzWattie and McCains and many others are responding positively and investing millions into Hawke's Bay, creating jobs and certainty for our traditional strengths. Our past, present and future will be connected to our land.

There are, however, other issues that will help define the outcome of this election, for example a huge increase in the cost of living, rising unemployment, the growing inequality gap between the privileged few and the vast majority.

Chris Tremain: We will continue

2. What work do you and your party do to create more employment in your electorates, and what do you see are the main employment sectors we should be growing?

to build upon our six-point strategy for economic growth to create more jobs across New Zealand and in Hawke’s Bay. It will include trade and innovation initiatives, skills and education investment and investment in infrastructure by the roll out of fibre. Our ‘keep a lid’ on Government spending strategy will push more opportunities into the private sector and into the provinces. And our focus on reducing compliance costs, such as lower ACC levies will make it easier for businesses to grow and create more jobs.

Craig Foss: We have rebalanced the tax system and bought the Government

On a local basis I will continue to work towards a regional plan for the

development of our wonderful province. This will be central to increasing the number of businesses, jobs and wages in Napier. I believe that some form of merged governance, not necessarily total amalgamation, is necessary if we are serious about implementing such a plan for growth.

Stuart Nash: The lack of new business growth and employment opportunities is one of the major failures of the Tremain/Foss tenure and this National Government. Neither the Government nor the region's National MPs have articulated any sort of local or regional vision or strategy to drive economic growth or develop employment opportunities in the province. Tremain and Foss' plans around regional amalgamation will not drive economic wealth at all. Governance is not the issue; economic development is. In the last five years, the region's population has grown by just over 200 people and we have the lowest median wage in the country. What I will

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Stuart Nash

do is work proactively with the Chamber of Commerce and the Napier City Council to develop a strategic plan and a set of objectives and outcomes that will focus on attracting businesses to Napier and Hawke’s Bay.

3. What is your plan to tackle youth unemployment in your electorate? Craig Foss: I am first and foremost a MP for Hawke’s Bay. All issues, from youth employment to winning our airport extension, are about our region and of course Tukituki is part of Hawke’s Bay. Our plan is to educate and train youth, to subsidise youth wages up to $5000, so they are able to take on jobs that are a step above and more sustainable than unskilled work. Our welfare reforms will stop the current nonsense where tax payer cash is thrown at 16 and 17 year olds not in school who are then told to come back a week later for more cash.

The combination of these policies, and our rebuilding of the economy will create the environment that can offer real jobs.

Chris Tremain: Government work programs such as Skills for Growth and Job Ops will continue to play a key role in helping to curb youth unemployment. The investment in a new

Chris Tremain

Craig Foss

addressing our youth unemployment.

Stuart Nash: Youth unemployment is a major issue. At the time of writing these comments, there are 58,000 young people who are not in education, training or employment and, as now proven, the current Government's schemes have not made a scrap of

Youth unemployment is a major issue ... there are 58,000 young people who are not in education Stuart Nash

Trades Academy at EIT will also play a role together with the ‘Youth Guarantee’ program which transitions young people into trades from a younger age. Nothing that government does will be more important than creating the framework for businesses to thrive and grow in our economy. Business growth is the key to sustainable long-term job growth and to

difference. Labour does have a suite of policies including a much higher level of career guidance services in secondary schools, bolstering the apprenticeship scheme, tailoring training to competencies and targeted evidencebased strategies that will ensure every young person has the opportunity to reach their potential.

4. What voting system do you support, current MMP or another type? Craig Foss: I am still considering whether we have got the balance right. My personal concern is to ensure that the majority of people believe that their voting preference translates into stable Government. Chris Tremain: I voted for MMP but will not be voting for it in the future. I will be voting for Supplementary Member. Under MMP the only vote that matters is the Party Vote. This means that 10 percent of the Party Vote with 120 seats in Parliament delivers 12 seats. Under SM the electorate seats return to prominence. There are 90 electorate seats elected under "SM" and 30 Supplementary or List seats. 10 percent of the Party Vote under SM delivers 3 seats as opposed to 12 under MMP.

Stuart Nash: MMP - but slightly revised.

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BRIGHT OUTLOOK FOR A As passenger numbers swing back towards near record highs last experienced before the Global Economic Crisis, the outlook for Hawke’s Bay Airport is bright with exciting plans for supporting business on the horizon. By Lawrence Gullery

by Anna Lorck

We have seen a strong recovery in passenger numbers back towards the record experienced in early 2008, and this is a positive indicator of increased economic activity for our region Chairman John Palairet

The Hawke’s Bay Airport reported a solid $896,781 after tax profit result for the year ending July 2011, with company performance ahead of budget through increased revenue and reduced costs. This compares to $678,359 in 2010. Announcing the result, chairman John Palairet said it has been a significant year with higher passenger numbers, increased flight schedules, completion of the long awaited runway extension, and improved car parking system. “The big swing upwards in the number of people flying in and out of Hawke’s Bay is positive news for

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business and the region’s economy. “We have seen a strong recovery in passenger numbers back towards the record experienced in early 2008, and this is a positive indicator of increased economic activity for our region,” says John.

The $6 million runway extension is the largest infrastructure project undertaken since the airport was built in the 1960s and a tribute to the entire team and the contractors, Higgins.

Passenger numbers at 431,903 for the year show a 10.9 percent recovery on a downward trend of the previous two years; numbers for the 2010 year were 389,582. The record was 449,000 in early 2008 then a decline down to below 390,000 by mid 2009.

“Despite wet weather and challenging conditions we completed the project within budget and before the full onset of winter.” The project was built in two stages with the northern extension of 100 metres operating from January, and the southern 340 metre extension completed by July 2011. “We now have a fully extended runway of 1750 metres


R AIRPORT

that has the capability of handling all jet aircraft operating domestically in New Zealand. “Futhermore the ‘building blocks’ approach applied to the development means the airport is well positioned to respond to any increases in demand and additional services”

Improving and enhancing customer service is important to the airport which this year invested in a new car park operating and payment system to provide a better, more reliable and efficient service.

“We also took advantage of the contractor working on site and extended the aircraft parking area to provide for a second airline and private jet traffic to futureproof the airport.”

John Palairet with business development manager Wayne Wootton

“Looking ahead Hawke’s Bay can expect to see increased development and exciting opportunities that support business in the the region,” says John.

“The business park design will be completed shortly and Wayne will be actively pursuing opportunities with local and national businesses to be based at the airport.

The appointment of business development manager, Wayne Wootton, signals the company’s focus on revenue growth both landside and airside with the initial emphasis on development of a business park.

“The company is in a very sound financial position and we are looking forward to a period of increased development”.

Making it easier for frequent flyers Purchase a pre-paid car parking debit card for $20 and you’ll never have to queue when leaving the airport again. Our new payment system makes travelling easier - where you can pick up your luggage and head straight to your car. Cards come loaded with $20 worth of parking and can be topped up at any pay station in the terminal – Eftpos, credit card or cash. Please remember to check your balance and always use your card when entering and exiting the carpark, even if the barriers are raised. Available now at the car parking office, or ask one of our team.

OCTOBER - DECEMBER 2011

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BLACK STICKS GO FOR GOLD WITH BAY BACKING Hawke’s Bay’s expected boost in international exposure over the next 12 months is due to a strong lineup of local businesses.

Backing the Bay & the Black Sticks

By Damon Harvey

These businesses have donned their black ‘n’ white colours to get behind the New Zealand men’s and women’s hockey teams (The Black Sticks) as they go for gold at the 2012 London Olympics. In late September, Hockey New Zealand revealed its principal sponsor partner as Hawke’s Bay for the two Black Sticks teams.

engage the entire Hawke’s Bay community to support the Black Sticks,” he says. The sponsorship agreement was engineered by Bruce Mactaggart, the co-owner of Auckland’s Vector Arena and the man behind the phenomenally successful 'Walking with the Dinosaurs'. Bruce, a Hawke’s Bay resident, said pulling off the sponsorship was important for the Black Sticks as they

can unite and use all our resources, financial and intellectual, to support our national team while also galvanising and supporting our own community," Mactaggart says. Hawke’s Bay Tourism general manager Annie Dundas said the sponsorship is a coup for tourism. “Hawke’s Bay Tourism couldn’t afford to market itself in many of the countries the Black Sticks visit in a year, so we are thrilled with the

A selection of local small, medium and large businesses have put their names to the unique sponsorship that’s set to unite the region like never before. The local businesses deserve a pat on the back for showing a commitment to the region and working together for the greater good of the community.

“The Black Sticks are getting the support and energy of an entire community and over the next year as they build to the Olympics, that will be incredibly powerful,” says Poole. The teams are already booked to stay in the region for an induction weekend from November 25-27 as well as pre Olympic training camps in 2012. Hawke’s Bay will also be on show to a world-wide audience of 38 million viewers when the premier men’s international hockey tournament, the Champions Trophy, which starts in early December. Mayor of Hastings Lawrence Yule sees it as a fantastic opportunity to take the Hawke’s Bay ‘brand’ to the world. “We couldn’t have commenced this initiative without the fantastic financial support of the initial Hawke’s Bay leaders. “We are now looking for ways to 16

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“It’s a great opportunity to come together under the Hawke’s Bay umbrella and collectively support the largest team contingent of Kiwi's going to the Olympics.” John O’Sullivan – Tumu ITM “Furnware thrives on being a unique company, so this partnership with the Hawke’s Bay community and Hockey NZ fits like a glove.” Hamish Whyte - Furnware “We supported this unique initiative as it is one way for Hawke's Bay to feel part of the 2012 Olympic Games through the NZ Black Sticks, but also to ensure Hawke's Bay promotes itself as a united region going forward. It is great to see our civic leaders working together as team players in getting the Black Sticks here!” David Mackersey - Mackersey Developments “This is a unique opportunity to join with other Hawke’s Bay businesses in supporting a National Sports team.

The announcement held in Auckland was a jaw dropper because instead of an international corporate being aligned with a national sporting team, it instead was a heartland province, keen to punch above its weight. Hockey New Zealand, headed by chief executive Hilary Poole, is busy looking at ways to promote the region and involve the community.

Why did our business support this innovation?

Rose Roil – Cottages New Zealand We supported this sponsorship because we saw it as being part of something special for Hawke’s Bay and for the Gemco Construction brand. Darren Diack – Gemco Construction

And the starting line-up is • Big Save Furniture • Cottages NZ

• NZ Entertainment and Events

• Farmlands

• Pak-Line

• Furnware

• Parkhill Farm

• Gemco Construction

• PORSE

• Hastings PAK’nSave

• Port of Napier

• Iain Taylor Family

• Sileni

• Lowe Corporation

• The Hastings Health Centre

• Mackersey Development • Neil Pulford and Claire Vogtherr

• Tremains - Colliers

• Ngati Kahungunu

• Unison

• NZCU Baywide

• Xero

head towards the Olympics. He also wanted to bring a region together behind a national sporting teams goal of Olympic glory. "This is not just about hockey – it’s about what is possible when a community comes together. How we

OCTOBER - DECEMBER 2011

• Tumu Timbers

potential exposure internationally and of course within New Zealand. “We will do whatever is needed to leverage this opportunity for Hawke’s Bay,” Annie says.

We love Hawke’s Bay and see its potential in a world perspective, we are right up there as an experience and a place to live, and better in some cases than, for example, Sonoma, the Barossa and Clare Valley. We have resources, technological know how and the potential to export world class products to the rest of the world We want this iniative to turn the eyes of the world to Hawke’s Bay so that they look/view, visit, then relocate and/or invest in this region that we know has so much to offer. Neil Fulford and Claire Vogtherr Our family, along with Hastings PAK’nSAVE, is delighted to be part of this unique sponsorship agreement. Throughout their schooling years both our sons, Aaron and Brendon were heavily involved with hockey playing for local schools, clubs and Hawke’s Bay representative hockey. The opportunity of sponsoring the Black Sticks has brought back some fond memories for both Pam and I of all the hours spent on the sideline watching our boys participating in the sport. Our family and staff join together in wishing both the Black stick Teams all the best of luck in achieving GOLD at the London Olympics”. David Smith - Hastings PAK’nSAVE


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BUSH BEATERS WHAT THE COUNTRY CAN OFFER A major focus is being turned on Hawke’s Bay’s rural centres in an effort to inject some renewed life into business opportunities for people living in the country. By Lawrence Gullery

It’s been a year of turbulent times for Central Hawke’s Bay and Wairoa with mounting social and economic issues hitting the headlines.

Inspiration and innovation Wairoa’s Colin Rafferty and his wife are on the brink of releasing a new product which could make its international debut on the baby care market within the next year.

But a targeted effort from the likes of Business Hawke’s Bay, Hawke’s Bay Tourism and New Zealand Trade and Enterprise as well as councils around the region is being made to turn their fortunes around.

The couple is pioneering a process and device which takes the hassle out of collecting and freezing breast milk, and hope to partner with the likes of Philips Avent or Tommee Tippee baby products.

Hawke’s Bay Tourism general manager Annie Dundas says it’s time to unlock the potential contributions Wairoa and CHB could make to the region. “The cruise ship visitor numbers

And I think CHB had done a good job with its Lamb Country promotion leading up to the Rugby World Cup and hopefully it will lead on to more initiatives they can continue next year. Annie Dundas

coming into the Port of Napier is going to be up around 47 per cent, up to about 100,000 per year so we are looking at a range of ways passengers can access CHB.

Gareth Pearce is a board member of CHB Promotions which headed the Lamb Country initiative. He is also managing director of Ezibed, a company he runs from Waipukurau. Ezibed is believed to be one of the first last-minute accommodation website businesses set up in 2003. “The Lamb Country has been getting

“There were some devices which did the job but there were a lot of processes involved, so we developed a collection process called Milky Fingers, a one-step process designed to collect and freeze breast milk.” The product includes a storage bag which can be attached to any breast pump via an adapter.

“And I think CHB had done a good job with its Lamb Country promotion leading up to the Rugby World Cup and hopefully it will lead on to more initiatives they can continue next year. “It’s an area that is really good at catering for that half-day rural farmstay experience which is appealing to visitors and now it’s a matter of working on how we get more people down there,” she says.

“My wife was looking to go back to work after having our first child and was wanting a better option when it came to taking breast milk from the pump to freeze for use later on,” Colin says.

The bag stores the milk in four sections, 15m to 30mm depending on size of bag. When the bag if filled, it is detached from the pump and secured with a cap then put into the freezer.

some notable media attention which we hope will result in more people coming to the district to spend their money. “Long term, it’s also about creating a sustainable brand for our export markets in our primary industries not only in CHB but around Hawke’s Bay as well, that can produce returns to the region.” Gareth says there is one area business, tourism and council agencies should focus on if they are going to help rural areas push past economic barriers.

The storage bag can be opened and the sections, which now look like milky fingers, put into feeding bottle to defrost and ready to use.

“That’s to embrace the fibre broadband network that’s being installed. That technology offers a huge opportunity for businesses in our area, allowing export companies to access new markets and increase their capacity via that link.”

Colin says the research and product development suggests the milk could freeze for around six months. It has taken almost two years to bring the product to concept stage. Research and development has been a big part of the product development. Information and advice has come from Hawke’s Bay Regional Council’s economic development arm. The council’s Jenny Brown has been using the TechNZ Partner programme to help Colin when it comes to getting advice on intellectual property (IP) rights over the new product. “I am a teacher and my wife is a vet so this is not our core business but it was an opportunity for us to come up with some ideas,” Colin says. Colin says it’s taken nearly two years of “going backwards and forwards to the drawing board” to move the product to a stage where it was ready to show. “It’s now a matter of bringing the two sides of the project, the product development and the IP together, so he can go to the market or find a partner. “We would prefer to partner with someone so this product could sit among other similar child care products to complement a range, rather than trying to take it to the market ourselves to compete against existing products.”

Gareth, who has a background in marketing, says there are a number of export businesses operating in CHB, such as Philippa Wright Wool Merchants, Silver Fern Farms as well as Laver and Wood, producers of export cricket bats. continued over

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ADVANCING BUSINESS OPPORTUNITIES IN WAIROA & CHB

At the time The Profit went to print, CHB Mayor Peter Butler was setting up to announce a new business which will operate from the former Ovation meat plant in Waipukurau. “We’ve been working with our local MP John Hayes in talking to a Aucklandbased company about a possible move to that site. We had put a team together from day-one of that plant closing to help find solutions. Our biggest worry is that $6 million of wages a year has gone, which means there’s less money going around our local CHB businesses.” In Wairoa, walks around Lake Waikaremoana coupled with plans to upgrade State Highway 38, from the town to the lake and across to Rotorua, are key attractions which could generate more tourism business for the northern Hawke’s Bay town. “One of the big things for Wairoa is intermediate transport which links from the I-site to the lake, dropping people off there, making it easy to access

We’ve got another group that wants to set up a cycle way as a tourism business on the current railway line from Wairoa to Gisborne. Les Probert

Waikaremoana,” Annie Dundas says.

Waikaremoana.

“We’re talking with the Wairoa District Council and a local man running a bus service to the lake over the summer to get some continuity in a service that would really enable visitors to experience the lake. It is such an iconic walk (around the lake) for the region and we don’t perhaps market it enough … we need to do more to profile it,” Annie says.

“We’ve got another group that wants to set up a cycle way as a tourism business on the current railway line from Wairoa to Gisborne.

The Lions Club in Wairoa has set up meetings for the business community to come up with initiatives to drive more business activity. Wairoa mayor Les Probert says many of the ideas have been around tourism, particularly involving Lake

“It’s based on a cycle that can be fitted onto the railway track and that would give us a tourist track from Gisborne out to Mahia and to Wairoa.” Les’ pet project for the past year has been lobbying the Government to upgrade State Highway 38 but that’s under threat of being put on hold as more money is directed to fixing Christchurch.

Helping Hands Contacts for business ventures: James Baty Wairoa District Council (06) 838 7309, james@wairoadc.govt.nz Ian Sharp CHB District Councillor (06) 858 8060, amcalwpk@xtra.co.nz Gareth Pearce CHB Promotions Board (06) 858 5442, gareth@ezibed.com Dennise Elers Community Development Co-ordinator CHB District Council (06) 8578060, denise.elers@chbdc.govt.nz Karen Cooper Hawke’s Bay Chamber of Commerce (06) 876 5938, karen.cooper@ hawkesbaychamber.co.nz Jenny Brown Hawke’s Bay Regional Council (06) 833 8049, jennyb@hbrc.govt.nz

He believes the road will generate more business through increased visitor traffic in a loop around the East Coast to Rotorua and Bay of Plenty. “So we are coming up with different ideas to bring that to fruition and I think it’s just a matter of perseverance.”

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Feature

LOGAN STONE CONTINUES TO GO FROM STRENGTH TO STRENGTH In 25 years Logan Stone has been involved in some of the most significant and high profile property transactions in Hawke’s Bay. By Damon Harvey

The Hastings based valuation firm is celebrating 25 years and The Profit’s editor Damon Harvey spent some time with one of the firm’s Directors, Frank Spencer. Frank says the company was set up in 1986 by Gerard Logan and Roger Stone with the objective to provide a full range of valuation services across all sectors – urban, rural, commercial and industrial. Current partners Boyd Gross and Frank joined the firm in 1989 and in 1992, firstly as employees and then as Directors. “They (Gerard and Roger) wanted to offer a high quality valuation service across all sectors and to enhance reporting standards.

We have become specialists in a number of sectors, by understanding the drivers of each sector and the requirements that the participants have for property. Many of the assignments we are involved in are confidential. However, the acquisition of the former Tomoana Freezing Works site by Heinz-Wattie was a high profile project.

“The dynamics have changed – there’s financial requirements that have never been part of those sorts of property, so return on investment is a key driver rather than the lifestyle component that was part of traditional farming,” he says.

Frank says three disappointments he’s seen within the property scene have

Frank Spencer

Boyd Gross

What may have been an ongoing liability in Hawke’s Bay was now an opportunity and history has shown continued investment in the site.

“The firm grew from the two of them focused on rural and urban into a full range of property services and more latterly it has evolved into more specialist areas.

Gerard left in 2001 and Roger retired in 2005. Since then the team has moved from its premises opposite Hastings Pak’n Save to new corporate offices in Hastings St South.

“We’ve ceased residential valuation work and have focused on specialised work such as financial reporting along with work around property advisory and the valuation of special purpose properties.

Over 25 year’s there’s been a mix of dramatic changes, innovations and a range of highs and lows.

“Our point of difference is our understanding of business and the role property plays in that. Property is a resource that’s used in business and it has to perform for that industry.”

Other highlights include involvement in treaty settlements, land amalgamations, Craggy Range and Kemblefield Wineries and ongoing work with DOC to value its core asset base, the ‘visitor assets.’

to change from a lifestyle or cottage style industry to a corporate base.

Our point of difference is our understanding of business and the role property plays in that. Property is a resource that’s used in business and it has to perform for that industry.

Logan Stone recognised the surplus capacity in the processing sector at the time and the meat industry co-operated to acquire Weddel’s assets and take the sites out of production. This move significantly reduced the value of Tomoana and Logan Stone was able to demonstrate to Heinz how the site could be acquired within their New Zealand capital expenditure authority levels.

Logan Stone has a client base that is more business focus.

profile subdivisions such as Kingsgate, Brookvale, Knightsbridge and the early stages of the redevelopment of Ahuriri.

“We initially developed our own database software and then contributed (and still do) to industry wide software. What Logan Stone now offers Hawke’s Bay property investors is significant experience of property types and transactions nationwide. Logan Stone has been involved in the development of a number of high

been the under utilisation of the Whakatu ‘wet’ Industrial area, the failure to relocate the saleyards to a rural location and the decision not to develop an Ocean Beach settlement. “Whakatu hasn’t been developed to the full extent for wet industry. Much of the new development is dry industry which is not using the existing infrastructure. “The plan for an inland port at Whakatu is also yet to be advanced. Logan Stone has supported moves to relocate the antiquated Hastings saleyards to a consented site at Irongate where a contemporary facility would be without the existing urban conflicts. “Relocation would unlock an urban site for development whilst removing the conflicts of transport and stock effluent from a developing commercial and residential locality.” “Ocean Beach – is a disappointment. I believe that the plan protected the environment with a confined footprint of development, whilst providing a seaside settlement that could have accommodated a number of residents and allowed more people to enjoy the beach environment and appreciate its conservation.

Frank Spencer

The impact of the Christchurch earthquakes is yet to be fully felt in Hawke’s Bay and Frank predicts there will be significant property that will suddenly and unexpectedly be at the end of its economic lives. “This is the biggest challenge across the country, and will change the landscape for the owners of older buildings and the cost of occupancy of older buildings. “Businesses will not put staff into earthquake prone space. “Owners will be faced with spending money upgrading or having a building that can’t be used. For us all the occupancy costs of buildings are increasing, but not the net rental to the building owner. The economic model of property investment will take a significant shift as a result. Logan Stone look forward to the next 25 years of valuation and property advice and are committed to providing Hawke’s Bay business and property industry participants with a high quality robust and independent service.

Frank says the most challenging sector is the primary sector, which continues OCTOBER - DECEMBER 2011

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MOSES NEVER HAD IT SO GOOD

Technology is there to assist us in our daily pursuits, and indeed most of the time it does. There are many people engaged in the conception, design and manufacture of technology in its myriad forms. By Wray Wilson | Need a Nerd

One of the newest kids on the block, and certainly the technology device creating the most interest in the market today, and probably the most development effort, is the tablet – not a new idea by any stretch, but an idea whose time has truly come. Tablets have been around for longer than most people think - the first patent for an electronic tablet used for handwriting was granted in 1888 but it wasn’t until the 1980s that practical working tablets were commercially released.

The iPad Apple first entered the market in 1993 with the Apple Newton but the real maturation of the tablet was the

introduction of the iPad in 2010. It, and the subsequent iPad2, have dominated and currently have just over 68% of the world market - you’d need to be living in the middle of the Amazon to be unaware of them. < The iPad 2 – the current ‘gold standard’ in tablet computing

Speculation that the Apple iPad3 is being released in 2011 is probably unfounded – the iPad2 is still a very new product which is setting the standard in the market and the iPad3 is not anticipated before March of 2012 – selling iPad 3, or even making its release date known any earlier, would kill valuable Christmas sales.

We come to your business / home and take care of all your technology.

35476

Product sales, set-up, advice and ongoing support.

The Androids In competition to the iPad the Android tablet offering continues to grow rapidly with more and more manufacturers producing models. Andriod (for you Amazon dwellers) is an operating system for mobile devices such as smartphones and tablets. It is developed by the group of companies led by Google. Because it is a free and open source software licence, it has been picked up by a number of manufacturers for installation on their < Samsung Galaxy Tablet – a solid performer in the crowded android tablet market

tablet devices (such as Acer, Asus, LG, Samsung and Toshiba to name a few). Hewlett Packard also made a brief and disastrous foray into the market with its WebOS based Touchpad earlier this year – the Topuchpad was withdrawn only a few weeks following its global launch because of poor sales.

Microsoft

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Blackberry Just released to ‘so-so’ reviews is the Blackberry Playbook Tablet running their own Blackberry Tablet Operating System. According to the experts it leaves the iPad well behind in multitasking as the PlayBook doesn’t need to stop one application to start up another. They can keep all applications running simultaneously. Subsequently the PlayBook has no ‘Home’ button unlike the iPad because users don’t need to stop running one application to start a new one. One of the most important considerations to make in choosing a tablet (in essence you are choosing an operating system) is the range, and interoperability, of the software. Each of the operating systems mentioned above has its own < The Blackberry Playbook – touted as “the world’s first professional-grade tablet”

App Market where you can download programmes to use on your device.

About the same time as the iPad3 launch, we should expect to see the final version of Windows 8 come on the market – Windows 8 for Tablet is being touted as a serious challenger to the iPad. Developer versions are starting to see the light of day now, and even < The Acer Iconia Tablet can run Windows 7 and features its own click in keyboard

0800 NeedANerd (0800 63 33 26) www.needanerd.co.nz service@needanerd.co.nz

in its early forms it looks like a very attractive and useable system on the small touch screen.

Tablets have come a long way since Moses received his riding instructions and they’ve got a fair way to run yet. If you’re in the market for one do your research well – they all have their own strengths and weaknesses. The rapid market development means that whatever you buy will quickly be superceeded, so choose something you love and avoid jealous coveting later. Wray Wilson is the chief nerd and franchise owner of Need a Nerd Hawke’s Bay. Need a Nerd is a nationwide technical sales and support business to the SME and residential market. Email - wwilson@needanerd.co.nz


PRO Sales

ARE THERE NATURAL BORN SALESPEOPLE?

Contrary to popular belief, the best salespeople aren’t the best talkers, they are the best listeners. By Brett Burgess | Sales Impact Group

A question I am often asked is “Are there natural born salespeople that we should be looking for?” My answer to this is there is no such thing as a natural born salesperson. There are salespeople with the “gift of the gab” who make good sales but they tend to lack consistency in their results. The best salespeople, the consistent high performers, are those who have been trained in the best sales practices and then supported through management. A vast amount of “sales training” is focused on product or technical training rather than specific sales skills development. This tends to produce product focused salespeople who use the classic show and tell sales presentation. Typically the presentation goes something like this – The salesperson looks around the prospect’s office and finds some item of interest and begins a discussion on this, much to the annoyance of the prospect who has had the same discussion with a hundred other salespeople and hasn’t got time to waste with the usual so called rapport building techniques. They then ask a few self serving questions to uncover a potential need, then launch into a product/technical solution based presentation.

A study of over 500 buyers from the Fortune 1000 companies showed that salespeople jump in with a solution before the real problem has been uncovered. This happens in 63% of sales interviews. Sales like any other business activity is a process and needs to be systemized to ensure consistency in the results. Exceptional salespeople have a planned approach to selling not canned and follow a process. McDonalds doesn’t hire staff and then challenge them to figure out how best to do the job. Instead they work on the basis that there is a best way to take an order, greet a customer and put a burger together.

In sales there is a best practice too. Like assembling a cheeseburger, sales has a process. Firstly to identify your prospects, next to get a referral to them, then establish trust, uncover their need, if they have one, present a solution, and ask for the business.

Selling is very simple but not easy! Imagine sitting on a plane at HB Airport, waiting to take off, and the captain comes on and says – “This is my first flight in one of these really big planes – I’m going to try and figure out the best

way to fly this thing”. Many companies send their salespeople out into the field with great product training and very little if any sales training to “fly by the seat of their pants”.

It is a fact that the greatest asset in our businesses is staff. It costs businesses just as much money in salary, travel and costs for a poor sales performer as it does for a great sales performer. Therefore we need to lift the performance of all our salespeople to ensure consistency in sales results. The way to achieve this is through using best sales practices and measurement for accountability. A question I sometimes hear is “What happens if we train them and they leave?” I ask “What happens if we don’t train them and they stay?” Coming back to what makes great salespeople, Malcolm Gladwell wrote in his famous book “Outliers” – “success in any field comes from opportunity and practice”. Many companies give their salespeople the opportunity to undertake sales training - what makes the difference between good salespeople and the great is that great salespeople continue to learn and practice the skills they have learnt. They say “practice

makes perfect” – this is only partly true – perfect practice makes perfect. Therefore sales come down to using best practice. The first of these is developing a goals programme around what your sales targets are, the obstacles of achieving these, the solutions to overcome these obstacles, and a detailed plan of sales activities mapped out over the next 12 months.

We can’t control sales – we can control sales activities. We will look at this in my next article.

Action Steps – 1. Review your sales targets 2. Break down into monthly and weekly targets 3. Review your Prospecting Plan 4. List 3 actions you could implement this week to move forward e.g. Ask your key clients for specific referrals

“Until we learn the formula (process) for success we can’t repeat it”

Brian Tracey

Brett Burgess is a Programme Developer and Facilitator for Sales Impact Group Ltd based in Hawkes Bay. To contact Brett visit www. salesimpactgroup.co.nz

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903 Heretaunga Street West, Hastings. hastings@speedysigns.co.nz OCTOBER - DECEMBER 2011

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Feature

SOLID RESULT FOR NZCU BAYWIDE

A merger with Wine Country Credit Union and strong member growth can be attributed to the solid year-end result for NZCU Baywide.

NZCU Baywide chief executive Gavin Earle announced a $1.066 million operating profit, an increase of 50 percent from last year. He added that the membership base across the 14 branch network is now at a record 30,000 members. “This puts us in a stronger position than a year ago and is in part due to the merger with Wine Country, membership growth and against tough trading conditions.

prosper in a challenging market,” Mr Earle said. NZCU Baywide is currently celebrating 40 years and is now the largest credit union in New Zealand. The customer-owned organisation reported a 33 percent reduction in loan default related expenditure. “We have worked closely with members that are financially finding it tough while some are also saying they are in a slightly better financial position. Mr Earle continued his caution to people borrowing from high interest

banks,” he said. The credit union undertook a more aggressive awareness campaign, launched a new prepaid Visa debit card product and a programme for members to better manage their financial affairs called Starfish. “Our role is to help members achieve their financial goals, while maintaining support of the community. “Our members are our customers, as well as the owners of our business. Everything we do is for the benefit of our member-owners,” he added.

Overall, NZCU Baywide continues to perform very well. Our stable, broadened, market foothold in the regions we operate in provides a solid platform from which to grow and prosper in a challenging market Gavin Earle

third tier “loan sharks”, and is urging the government to take swift action to shut down lenders that are acting outside of the law. Gavin Earle

“The improved position is a reflection of the drive and focus of the board, management and staff.

Total assets increased by 12% ($18.6 million) to $168 million and the organisation holds 17.3 percent capital adequacy, well above the 8% minimum requirement.

“Overall, NZCU Baywide continues to perform very well. Our stable, broadened, market foothold in the regions we operate in provides a solid platform from which to grow and

“NZCU Baywide is financially very robust and well placed to grow and expand as the economy recovers. We have raised our profile and are now a true competitor to the mainstream

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NZCU Baywide chairman Iain Taylor said it was exciting that the credit union is celebrating 40 years with a vision for continued growth and focus on members’ needs. “As we celebrate 40 years of operation it is especially pleasing to be able to report to the membership upon another year of robust and successful performance. “The Credit Union was formed in 1971 and from very humble beginnings in Whakatu we are proud to now be acknowledged as New Zealand’s

Iain Taylor

largest Credit Union.” One area we have been foccused on is assisting members improve their own personal financial position, with a particular emphasis on consolidating and managing down their debt levels. NZCU Baywide has a BB stable rating from Standard & Poors.

This Years highlights • A $1.066 operating profit • Total assets increased by 12% ($18.6 million) to $168 million • Merger with Wine Country Credit Union • Member reserves of $27.4 million • Risk Weighted Capital of 17.3% • New branch in Wanganui and relocation of Wainuiomata.


A STRONG PRESENCE IN CREDIT UNION HISTORY IN THE BAY Bob Strong continues to have an impact on NZCU Baywide 30 years since he first became a credit union director.

by Damon Harvey

Bob’s also a trustee, which means he has additional responsibilities such as signing off all advertising and legal documents on behalf of NZCU Baywide. Bob, a former lab technician at Pan Pac, has been an active credit union member for over 30 years. He is a strong (sorry about the pun!) believer in the credit union’s philosophy of ‘people helping people’. Pan Pac had its own credit union – the Pan Pac Employees Credit Union of which Bob was a director for 10 years. It merged with NZCU Baywide in 1989. He also sat on the NZ Association Credit Union board for 10 years and the Australasian Institute

6

Bob Story

of Credit Union directors for five years. Over Bob’s time the number of Credit Unions throughout New Zealand has dropped dramatically due to amalgamation, but on the flip side they have become much stronger and offer a wide range of services. At one stage there was over 300 credit unions spread throughout New Zealand – many associated with large businesses like Pan Pac and Whakatu Freezing Works. Hawke’s Bay at its height had 24 but now there are just three credit unions. Although the number of credit unions has fallen the total number of members has grown, with NZCU Baywide the largest in NZ boasting more than 30,000 alone! “The reduction in numbers has come about by mergers which has strengthened the management and governance of the credit unions and, more importantly, has increased the security and benefits for the members,” Bob says.

Timeline of Credit Unions in Hawke’s Bay

1971

Whakatu Freezing Work Employees Credit Union is formed (pictured above)

1981

Membership opened up to employees of companies associated with Whakatu. Name changed to HB Meat Company Employees CU

1986

Name changes to Baywide Credit Union

1986

Whakatu Freezing Works closes and puts credit union at risk of closure as well

1987-1988

Mergers between Baywide, Pan Pac Employees, Williams & Kettle Employees, HB Consumers Co-op and Awatoto Workers CUs

1989

Change to the common bond to allow all residents of HB to join. It was at this time CUB experienced a fantastic growth in membership.

1988-1992

Strong year on year growth of between 20% to 38%

1990

Waipukurau branch opens

1991

Whakatu branch moves to Karamu Road and a service centre opens in Napier

1993

Napier branch moved to larger premises in Onekawa

1999

Merges with Wairoa District CU and HB Power Employees CU

2001

Napier branch moves to Thackeray Street

2000-2011

2011

New branches opened in Dannevirke (2001), Gisborne (2008), Masterton (2008) and Wanganui (2011). Further mergers with Napier City Council Employees Credit Union (2001); Credit Union MidCentral (2008); Harbour City Credit Union (2008); Hutt Valley Co-operative Credit Union (2008); Credit Union Taranaki (2010) & Wine Country Credit Union (2011) NZCU Baywide celebrates 40 years with 14 branches and 30,000 customers! NZ Credit Unions celebrate 50 years.

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HAWKE’S BAY A&P MERCEDES-BENZ WINE AWARDS LEAD BY EXAMPLE Awarding excellence at the Hawke’s Bay A & P Mercedes-Benz Wine Awards – New Zealand’s largest and most significant regional wine competition.

After hundreds of Hawkes Bay’s wines have been sniffed, swirled, sampled and spat, the judges made their decision. The Champion Wine of Show at the 2011 Hawke’s Bay A&P Mercedes-Benz Wine Awards is Villa Maria’s Single Vineyard Keltern Chardonnay 2010. Wine Awards Chairman Max Morton, on behalf of all involved extends a huge congratulations to the trophy and medal winners. “Many people are behind the success of these wines which showcase Hawke’s Bay to the world. The awards represent the best of the best from the local wine world and have significant relevance, not only because they are subject to tough judging criteria, but also because they are pitching like against like, with wines limited to a single region.”

Chairman of judges Rod McDonald says it’s no surprise that the winning Chardonnay topped the show. “This single vineyard wine is a great example of not only classic characteristics of Hawke’s Bay Chardonnay but also shows that stylistically Hawke’s Bay is moving forward with greater regard for finesse, balance of acidity and complexity. “This wine would not look out of place lined up with the greatest chardonnays from anywhere in the world – and

that's the benchmark we're judging against.” Rod was joined as a judge by Warren Gibson, Steve Flamsteed, Joelle Thomson, Matt Deller, Cath Oates, Ant MacKenzie, Leith Ashworth, Tracy Taylor, Damian Fischer and Brandan Nash. Hawke’s Bay’s usual varietal strengths shone through with a high number of gold medals awarded in the Chardonnay, Syrah and Cabernet and Merlot blends classes.

Alastair Maling - Villa Maria Group

This wine would not look out of place lined up with the greatest chardonnays from anywhere in the world – and that’s the benchmark we’re judging against. Rod McDonald Rod highlighted the power of Hawke’s Bay’s ability to produce gold medal wines across a range of grape varieties. “Such diversity is a real and unique strength of our wine growing.” Senior judge Steve Flamsteed from Giant Steps Winery in Australia, found the wines demonstrated a unique ‘Hawke’s Bay-ness’. “As well as meeting quality criteria, the most important thing to me about regional shows is that the wines demonstrate a sense of place - the Chardonnay and Syrah for me, have shown this in spades.”

The panel judged 350 wines over two days at the EIT Campus awarding 33 gold, 58 silver and 121 bronze medals. Sponsors

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In today’s market, having a strong and recognisable regional character is a huge strength, he says.

Judge and wine columnist Joelle Thomson was also struck by the variety and innovation on show. “The structured ripe Merlots, the rounded-bodied Sauvignon Blancs, the drop-dead gorgeous Syrahs and even a very pure expression of Sangiovese all show yet again how many strings Hawke’s Bay winemakers have to their bow.” The high standards set by the awards are also contributing to the skill set of the new breed of winemakers currently studying at Eastern Institute of Technology (EIT). “The student class of wines was also a surprise and it was a delight to see the high quality come through.”


TROPHY WINNERS

CHAMPION OF CHAMPIONS

SILVER BEST IN CLASS

GOLD

CHAMPION MERLOT Church Road Cuve Merlot 2009 Wine Maker: Chris Scott .......................................................................

CHAMPION RED BLENDS CABERNET SAUVIGNON DOMINANT Newton Forrest Estate Cornerstone 2009 .......................................................................

CHAMPION RED BLENDS MERLOT DOMINANT Church Road Hawke’s Bay Merlot Cabernet Sauvignon 2009 Wine Maker: Chris Scott .......................................................................

CHAMPION SYRAH Alpha Domus The Barnstormer Syrah 2010 Wine Maker: Paul Ham .......................................................................

PINOT NOIR (BEST IN CLASS) Osawa Wines Prestige Collection Pinot Noir 2010 Wine Maker: Mark Lim .......................................................................

CHAMPION OTHER PREMIUM RED VARIETALS AND BLENDS Villa Maria Reserve Malbec 2009 Wine Maker: Alastair Mailing .......................................................................

CHAMPION CHARDONNAY Villa Maria Single Vineyard Keltern Chardonnay 2010 Wine Maker: Alastair Maling

CHAMPION SAUVIGNON BLANC AND/OR SEMILLON Trinity Hill Hawke’s Bay Sauvignon Blanc 2011 Wine Maker: John Hancock

CHAMPION MUSEUM CLASS Black Barn Vineyards Barrel Fermented Chardonnay 2007 Wine Maker: Dave McKee

.......................................................................

...............................................

CHAMPION PINOT GRIS Sileni Estate Selection Parkhill Pinot Gris 2010 Wine Maker: Grant Edmunds

EXPORT AWARD Matariki Quintology 2007

.......................................................................

CHAMPION VIOGNIER Villa Maria Single Vineyard Omahu Gravels Viognier 2010 Wine Maker: Alastair Maling .......................................................................

PREMIUM WHITE VARIETALS (BEST IN CLASS) Esk Valley Hawke’s Bay Verdelho 2011 Wine Maker: Gordon Russell .......................................................................

CHAMPION SWEET WINES Alpha Domus Noble Selection 2011 Wine Maker: Paul Ham .......................................................................

BRONZE

TROPHY GOLD

BRONZE BEST IN CLASS

BRONZE TROPHY

H AW K E ’ S B AY A & P MERCEDES-BENZ

W I N E AWA R D S

SILVER

.......................................................................

SUSTAINABLE AWARD Villa Maria Single Vineyard Keltern Chardonnay 2010 Wine Maker: Alastair Maling .......................................................................

WINERY OF THE YEAR Esk Valley Winery .......................................................................

RESERVE CHAMPION WINE OF THE SHOW Alpha Domus The Barnstormer Syrah 2010 .......................................................................

CHAMPION WINE OF THE SHOW Villa Maria Single Vineyard Keltern Chardonnay 2010

CHAMPION ROSÉ Esk Valley Hawke’s Bay Merlot Malbec Rose 2011 Wine Maker: Gordon Russell

...........................................................

.......................................................................

YOUNG VINTNER’S SCHOLARSHIP Sophie Harris

SPARKLING WINE (BEST IN CLASS) Morton Estate NV Reserve Sec NV

GOLD CHAMPION OF CHAMPIONS

SILVER

HAWKE’S BAY CELLAR DOOR OF THE YEAR Church Road Winery .......................................................................

.......................................................................

BEST STUDENT WINE Johnathan Musther

SPONSORING SUCCESS “The wine industry is a vital part of our primary sector with a significant impact on the look and feel of Hawke’s Bay. “We are committed to supporting industry growth through education, international critical acclaim from the judging panel and the validation of the quality of wine produced here. From left: Max Morton chairman HB A&P Mercedes-Benz Wine Awards & board member HB A&P Society, Robert Pattullo president - HB A&P Society, Rod McDonald chairman of judges, Brent Linn general manager HB A&P Society

The Hawke’s Bay A & P Society continues to champion our region’s primary sector. As the underwritter and organisational force it provides seamless event management and drives nationwide publicity. Awarding winemaking heroes of tomorrow, the society also provides a scholarship to an outstanding EIT Wine Science (second year) student each year, which covers their third year of study. Celebration of excellence is the perfect fit for the ideals of the society, says general manager Brent Linn.

“We are recognising Hawkes Bay’s unique terroir, the people, the land and the philosophy.”

The awards sit well alongside other key events backed by the society including; the Hawke’s Bay Farmer of the Year, the Farmers Market, the Horse of the Year and one of the most successful A & P Shows in the country.

“We’re in the business of celebrating excellence in Hawkes Bay’s primary sector and in the process we’re identifying the leaders of the future.”

‘Best in Show’ is an appropriate description for the principal founding sponsor of the awards, Mercedes-Benz New Zealand. Mercedes-Benz New Zealand is excited to be supporting the very best in Hawke’s Bay wine, which is a natural partnership, says CFO and executive general manager Steve McHutchon. “We applaud the consistently high calibre which emerges during the rigorous judging process and we share a commitment to outstanding quality and attention to detail. “Year after year the stunning wines presented make for riveting competition and a recognition of excellence.” Celebrating 125 years as a leader in automotive design, innovation and engineering since inventing the automobile, Mercedes-Benz captures the thrill and fascination of the definitive driving experience. “We look forward to increasing profile in the region thanks to some exciting developments in our dealer network.”

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A dedicated family of sponsors ensures the on-going success our region’s wine awards. Sponsors ha the way in which the wine industry permeates so many facets of the Hawke’s Bay community. We sa successful business leaders in our region. WHK - sponsors of

Chartered accountant and financial services firm WHK has been offering sound advice and knowledge to the wine industry for the past 30 years.

Merlot Category

A founding sponsor, WHK is proud to have seen substantial growth in the quality of wine produced from Hawke’s Bay, says principal Steve Alexander. WHK has a wine specialist team working alongside wineries implementing practical solutions and inside knowledge. “We’re providing expert support such as budgeting, cash flow forecasts, financial analysis, outlining trends, and identifying

BAYLEYS HB REAL ESTATE - sponsors of

Steve Alexander

First time sponsor Bayleys Hawke’s Bay Real Estate has been marketing properties including wineries and vineyards since 1996.

Red Blends Merlot Dominant Category This year it was Bayleys who successfully managed the sale of Paritua Vineyard in Hawke’s Bay. Recent accolades include the Bayleys “Ultimate Result Award” for best sale results which recognised the concurrent auction

FLUIDEX TRANSPORT LTD - sponsors of

areas for improvement to enhance business in what is a challenging environment.” The team, includes vineyard owner Catherine Howell who provides first hand working knowledge of the industry and region and Steve recently presented at national Romeo Bragato conference on budgeting and cash flow.

of two significant rural properties sold on the same day, going under the hammer for a combined total of $15.45 million. The company has been previously associated with national wine awards (Air New Zealand) through the Bayleys Viticulture Division.

Fluidex Transport carries bulk wine and juice throughout New Zealand by rail, road and sea.

Syrah Category A founding sponsor, managing director Tony Galbraith says the team takes pride in being recognised by leading wine producers as an integral part of the industry. “The support and endorsement of our customers is something of an award for us.”

MARKHAM’S HAWKE’S BAY - sponsor of

Established 60 years ago, Fluidex was the first New Zealand transport company to achieve ISO 9000 status and is part of TGL Group. Road tankers are dedicated to wine and juice ensuring maximum integrity. Units are available in different sizes to suit various parcels of product.

Markhams Hawke’s Bay has been part of the local community for 99 years, with exciting centennial celebrations planned for 2012.

Pinot Noir Category As an integral part of the region’s business environment the independently owned firm of chartered accountants and business advisors is actively supporting the region. Along with the awards, they support a number of wine industry initiatives including the Markhams Young Viticulturist of the Year competition and the six-monthly national Markhams wine business confidence survey.

Principal and spokesman for Markhams wine business development unit, Hamish Pringle says the firm works hard to establish strong relationships based on understanding, trust and reliability. “We’re a keen member of the group’s wine industry business development group, and experience and expertise we’ve developed is shared with a number of local grape growing and winery clients.” Hamish Pringle

Sponsors

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CHAMPION OF CHAMPIONS

SILVER BEST IN CLASS

GOLD BRONZE

GOLD CHAMPION OF CHAMPIONS

SILVER TROPHY

rs hail from a vast range of backgrounds, their number and variety reflecting We salute all sponsors and take this opportunity to toast their achievements as

ATI ENGINEERING - sponsors of Chardonnay Category

ATI Engineering are precision engineers, designers and fabricators specialising in food and beverage processing equipment including wine tanks, bottling conveyors and other associated winery equipment.

In another recent achievement ATI has the procedures and qualifications to fabricate HASNO tanks for chemical, fuel and hazardous goods storage. Managing director Sam Wood says: “We hope to support and service the wine industry for many years to come and appreciate the opportunities we’re been given in return. “We also enjoy working with such a passionate bunch of people.” Sam Wood

ATI design and manufacture WilliamsWarn brewing appliances, that can produce chilled beer in seven days to a commercial standard. These are also suitable for sparkling wine, cider, mead, ginger beer and non-alcoholic refreshments.

MR LABELS - sponsors of

HURFORD PARKER INSURANCE BROKERS LTD - sponsors of

For Prime Trading director Peter Penman, helping the wine industry grow is a highlight of his business.

Abbie Single

MR recently acquired Strawberry Hill, adding a glass and porcelain printing division and glassware can now be printed to match labels. “We are having a great time devising cool ways for people to promote their businesses with this.”

GOLD BRONZE

TROPHY

H AW K E ’ S B AY A & P MERCEDES-BENZ

W I N E AWA R D S

SILVER

Recently independent trial work has been completed in New Zealand on Brimstone™ 90, a unique Sulphur-Bentonite prills. “This has been proven to increase the quality of Sauvignon Blanc and the trial report is now available,” says Peter. Prime Trading has a nationwide network with an environmental division, offering environmental remediation and waste management services.

A second year category sponsor Peter has just signed up for a further five years, reflecting the company’s long history of commitment to the wine industry. Supplying raw materials and chemicals to the industry for more than 25 years, Prime Trading provides specialist fertiliser products.

Pinot Gris Category

For directors of MR Labels Abbie Single and sister Jo Single seeing their work on so many bottles at the awards is a bonus to top off a great evening.

“We like to make sure that the label is functional, looks great and attracts the target market.”

Sauvignon Blanc and/or Semillon Category

SOMERSET SMITH PARTNERS - sponsors of

Viognier Category

Specialising in high quality self-adhesive labels, Abbie says labels are a big part of getting the product to market.

PRIME TRADING LTD - sponsors of

BRONZE BEST IN CLASS

Adding value to the appeal of Hawke’s Bay as a place to live and work is an important part of investment advisers Somerset Smith Partners’ sponsorship. All three partners are Hawke’s Bay born and bred with numerous connections to the local wine industry, including a love of wine. The firm has a committed ownership structure having just eight partners

in its 77 year history, along with a dedicated and faithful staff and a loyal client base. Managing partner Anthony Sabiston says some clients are in their fourth generation dealing with Somerset Smith. An NZX firm, its six HB advisers recently gained Authorised Financial Adviser accreditation to meet new legislation. The firm’s commitment to customer service has been recognised three times at the Napier Inner City Customer Service Awards winning Gold for “consistently exceptional customer service”.

Gold medals are a key part of business for insurance brokers Hurford Parker.

Champion Sweet Wines Category Managing director Jeff Parker says its tailored Gold Medal Vintage insurance policy has been widely accepted with over 80 wineries and wine making facilities taking up cover. ‘Local, personal and professional’ whilst ‘insuring your

future’, Hurford Parker with 12 staff, is the largest locally owned and operated insurance brokers in the region. Hurford Parker is experienced in general insurance underwriting and has associations to 12 independent New Zealand insurance broking companies, providing clients the advantages of an effective lobby group, translating into negotiating ability on policies and policy wordings.

OCTOBER - DECEMBER 2011

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PRO

Feature

WINEWORKS HAWKE’S BAY - sponsors of Sparkling Wine Category

Bubbling success is even sweeter for the team at Wineworks. The bottling contractors has installed its first sparkling wine production facility in Hawke’s Bay. The new line brings achievable margins within reach of wineries making

JENNY NILSSON HOUSE OF TRAVEL - sponsors of Hawke’s Bay Cellar Door

Founding sponsor Jenny Nilsson from House of Travel Hastings and Havelock North, says it’s been a “fantastic journey.” “Born and raised in Hawke’s Bay I wanted to be part of something very special and unique, showcasing the best of the Hawke’s Bay wine industry and sitting well with my love for the region.

sparkling wine, and is now producing thousands of cases of bottled bubbles each week. Wineworks used economies of scale to bring benefits to its customers since its establishment by Tim Nowell-Usticke on his grandfather’s retirement farm outside of Hastings in 1995. These days the company’s success relies on a team of experts dealing with a myriad of issues that arise from bottling, warehousing and distributing our customer’s wines to the world.

specialised sector of the public,” says Jenny The relationships formed with numerous wineries is rewarding and inspiring. “Nothing beats reading about a winery’s success in a new market or in a prestigious international competition and knowing that we played a part in getting them there by organising their travel.”

“It’s a wonderful fit for us and a great way to establish our name in a

Sponsors

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OCTOBER - DECEMBER 2011

BLUEWATER HOTEL - sponsors of Museum Class Category

The Bluewater Hotel’s Rodney Green has lived his life in Hawke’s Bay and loves the wine industry and its people. He’s a major benefactor of many events throughout the industry and believes its success is important to the welfare of all those living and working in the Bay. For 13 years the team has welcomed and given great service to visitors, including a recent visit from the Canadian rugby team, and they are

ATTN! MARKETING PR - sponsors of Rosé Category

Attn! marketing pr is tickled pink to be sponsoring the Rosé Category. This could be because directors Anna and Damon Harvey have a family of five girls, or because Attn! simply adores Hawke’s Bay wine. As the region’s most influential marketing and communications

also the preferred accommodation for Central Districts cricket and other visiting sports teams. Rodney contributes success to the staff, who love seeing visitors returning every year and recommending to others The Bluewater and its rooms with commanding sea views.

company, Attn! aims to maximise reputations and build strong brands through communications and marketing strategies for a wide range of clients. Anna says the awards are an excellent example of a reputation being earned. “It’s not what you say, it’s what others say that really matters. “The awards help tell a story of Hawkes Bay’s success to wine consumers’ throughout the world. “It takes time to build a reputation – you have to work at it and maintain the highest standards.”


CHAMPION OF CHAMPIONS

SILVER BEST IN CLASS

GOLD BRONZE

GOLD CHAMPION OF CHAMPIONS

SILVER TROPHY BRONZE BEST IN CLASS

GOLD BRONZE

TROPHY

H AW K E ’ S B AY A & P MERCEDES-BENZ

W I N E AWA R D S

SILVER

LOGAN STONE - sponsors of

From Hawke’s Bay Logan Stone has become the leading provider of valuation services and property advice to the vineyard and wine sector throughout New Zealand.

Export Award “Our New Zealand- wide understanding of this sector is comprehensive and we are well placed to give you the benefit of our knowledge and experience,” says director Boyd Gross.

NZ FROST FANS LTD - sponsors of Sustainable Award

NZFrost Fans plays a critical role in protecting hundreds of hectares of vineyards across the region, which every year face the threat of severe frost damage.

A company built on innovation, NZ Frost Fans are world leaders in this field. NZ Frost Fans has the leading edge in design through to manufacturing as well as field

EIT - sponsors of Judging Facility

placement, installation and servicing. Specialist service centres and technical staff are located at the three major horticultural regions of Bay of Plenty, Hawke’s Bay and Marlborough.

The Eastern Institute of Technology’s (EIT) involvement brings invaluable learning opportunities for students.

Centre for Viticulture and Wine students assist with the judging using at the EIT’s sensory laboratory and as stewards at the dinner and School of Tourism and Hospitality students help with catering and front of house. EIT and the regional wine industry have always enjoyed strong, mutually beneficial links. Head of EIT’s School of Viticulture and Wine Science

MARDIGRAS EVENTS - sponsors of

“The team has the skills to add value to your property dealings, traversing all property sectors from primary industries to commercial and industrial.”

Diane Marshall says the industry’s input into EIT’s teaching and research programmes is essential, providing work experience, field trip opportunities, guest speakers, sites for staff and student research, grapes for winemaking and student scholarships. “In turn, EIT contributes to the regional and national wine industry by providing well trained, knowledgeable and skilled graduates who are

When there’s a special event on in Hawke’s Bay, chances are Mardigras Event Hire is part of it.

Hire Equipment They’ve been behind the scenes at awards, the A&P Show, RWC games at Mclean Park, the Charity Wine Auction, Mission Concert, Holly Hospice Trail, Art Deco Weekend and the CJ Pask Great Long Lunch – to name a few! Managing director Greg Gilmour attributes growth of

HAWKE’S BAY TODAY AND RADIO NETWORK Media Partners

Hawke’s Bay Today has been a long-standing and proud supporter. “We see it as an icon event for the region, one that has grown in stature over the years and which will continue to play a leading role in promoting Hawke’s Bay’s fine wines to the world.

the event hire industry in part to the wine industry. “The many harvest weekends, wine and food festivals, concerts and at wineries and restaurants as wedding and function venues everything has a positive impact on our business.” “Having worked closely and seeing the effort put in by the society and sponsors there is a great sense of pride shared among our team at being part of this event. “Winners are true standouts as the competition is world class.”

Spreading the word on the airwaves about the awards in Hawke’s Bay is Newstalk ZB. Award’s news and coverage is broadcast to an increasingly large audience with Newstalk ZB rated as Hawke’s Bay’s Number One station for listeners 40 years and over. The station is now on FM and AM

providing extensive coverage to its primary audience of information seekers. Radio Network’s eastern region general manager Rebecca Johnson says listeners are business owners, decision makers and community influencers from key upper socio groups. Rebecca says the awards provide the perfect partnership for aligning Newstalk ZB with their target audience, the local wine industry and the Hawke’s Bay community.

OCTOBER - DECEMBER 2011

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PRO HR

LANDING THE RIGHT FISH

Recruiting is a bit like fishing…the process is often costly, time consuming and sometimes fails to result in a fish for tea (or results in you hooking an eel when you wanted snapper). By Sue Whiteley | Grow HR

For the candidate, often the fishermen is using the wrong bait or when they do bite they wish they hadn’t because the next step is the frying pan! Unless you are an expert, when you want to hook a good fish you go out with a mate who knows where the best spots are and who can give you a bit of advice to improve your chances of success. Conversely when recruiting, many think they can land the best snapper, even when they have no idea where to fish! My other half was recruiting recently and despite my encouragement to use a specialist agency, he decided to go it alone on the basis of cost and “how hard can it be?” Of course, I insisted that he did a proper job of it, and afterwards he commented how much time it took to get it right. I am sure that if he multiplied the hours taken by his charge out rate, it would have been cheaper to get some expert help. Of course, he did most of the process in the evenings and on weekends, which would have been time that he could have spent fishing…well, if he did that sort of thing!

So how do you increase your chances of success? • Know what you want to catch – be clear about your

requirements – make sure you have a meaningful and measurable job clearly documented in a job description.

• Fish in the right places – use specialists who can ensure your adverts get seen by the right people and who will help you word them in such a way as to stop eels from biting. They can also help you ensure that you ask the right (and often the difficult ) questions and that you deal with the ones you throw back fairly, professionally and legally.

assessment” as part of the selection process. Invest your money in getting the right support –you can waste a lot of time trying to make something edible out of that nasty eel you caught! An HR expert can help you develop your

recruitment agency or testing support, we have strategic alliances with the best in the business and we recommend Red Consulting Group for recruitment support and People Central for candidate testing and assessment. Next time we’ll talk about what to do when your fish has been landed!

• Get advice on what bait to use – the money, the job and the Terms & Conditions have to be reasonable (and even attractive, particularly if you want to catch a rare fish). Then make sure the fish gets what it was expecting – don’t lure your fish in with the promise of a nice juicy squid and then deliver a horrid plastic imposter.

• Make sure your fish is “legal” – check their right to work, their criminal history, their sickness and ACC records, check they are healthy and get detailed references about previous work history.

• Know what you might be about to catch - using testing as part of your recruitment process to make sure that your fish is what is what it appears to be. You may even consider giving the person an “on job

structure, provide clarity around what your needs are, help you decide what remuneration is correct and what terms and conditions are appropriate and advise you on the support you may need to get your processes right. At GrowHR we do not provide

Sue Whiteley is a Director of Grow HR. Sue has 20 years experience in all aspects of HR and has extensive knowledge of how to build a culture of high performance within large and small organisations. To contact Sue, email sue@growhr.co.nz

Because we know what

your worth

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Experience to understand your business value and credible advice to help you grow.

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p.06 870 9850 e.valuers@loganstone.co.nz THE

OCTOBER - DECEMBER 2011


PRO

Primary

TAKE A BREAK FROM THE FARM & HAVE SOME FUN! It is time to take some profit and enjoy the times, you deserve it and it almost certainly will increase your productivity… By Brent Paterson | Rural Directions

Someone once suggested to me that farmers were an extraordinary breed of people with such long term views on their farms or ‘lifestyles’ that they forget to put a dollar value on their time. From where I stand in the industry I think that there was a huge amount of truth in that statement. Now things are different, we run businesses not farms and we have to record employee’s holidays and pay for overtime, we have 6 month,12 month, 3 and 5 year plans and forecasts, we are well researched and embrace modern technology but have we lost the lifestyle factor? The ingredient that helps draw people to a life on the land. Many now have a focus on debt reduction and are starting work on deferred maintenance programs including specking up the bikes and

vehicles but few have invested in themselves and their families - I believe this will give you your greatest return on investment. Reading through some old diaries of my forefathers I turned to July and there was a line through it saying TAUPO and there it was again in January! Of course this is not possible for many, but the message is clear - if it’s not in the diary it won’t happen. Perhaps now we can see through the mist and begin succession planning; I know for a fact that it’s easier selling a dream when it is a dream and not a nightmare. I challenge you to invest in yourselves and your families; get the white board out and do some planning, get the diary out and mark in the holidays and have some well-deserved fun. I was recently at a conference with 700 - 800 people in attendance and a presenter from America. It was so refreshing to see his ability to mix business and fun as he explained the

I challenge you to invest in yourselves and your families; get the white board out and do some planning, get the diary out and mark in the holidays and have some well -deserved fun. Brent Paterson

importance of getting yourself in the wake up”! The lesson to Dad was just right state of mind in the morning. For keep it simple; this now makes me example you could watch funny videos laugh every morning. I emailed this to in the morning (e.g. http://www.youtube. the presenter and it makes him laugh com/watch?v=2O15DXv3Vwg) rather also, so mission accomplished. than the news of murder and storms I encourage people in the primary sector and wars. This guy was hilarious and to take some profit and take some time gave messages about how productivity - your productivity will increase through can be lifted by the use of fun. freshness, wellbeing and family. After the conference I got home and Brent Paterson is the founder and said to my six year old daughter “did managing director of Rural Directions. His rural credentials are impressive from you know that the most important running a sheep stud and beef operation thing to do in the morning is laugh”. I in Patoka, through to setting up Rural then went on to bore her about the Directions HR and Rural Direction Primary conference speaker. Not so long into the Industry Management. To contact Brent conversation she came back and said Email - brent@ruraldirections.co.nz “Dad, the most important thing you can do in the morning is to

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OCTOBER - DECEMBER 2011

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Feature

COTTAGES NZ STAYS AHEAD OF THE GAME WITH ITS LATEST PRODUCT Award winning local business Cottages New Zealand has launched its latest product range that’s targeted at the education sector. By Damon Harvey

The new product range – called the Excel Series, was officially launched by New Zealand Prime Minister John Key in September. The product range has been a work in progress for some time and has evolved from Cottages NZ’s ability to build prefabricated buildings in its purpose built workshop, which are then transported to the property.

opportunity to supply modern learning environments, was the catalyst to pushing forward. “The building methodology of transporting to a property has been tried and tested with huge success. Cottages NZ has delivered new homes to remote beaches and New Zealand Police Stations to far fetched places such as Russell.

John Roil

Managing Director John Roil said although it was a tough call to invest further in the business when the economy was at a low ebb, the

“We only had to do site preparation and then it was basically dropping off

Primary. It was built off-site and after we transported it out there, we hooked them up to power and telecommunications. It was then we knew we were on to a good thing. “We received huge praise from the school’s principal and that gave us confidence in looking at a new arm to our business,” Mr Roil said. What impressed Patoka School staff, parents and pupils was the limited

Prime Minister John Key meets students from Frimley Primary. Also pictured is John Roil (right) and Sarah Roil (foreground)

the building and within 24 hours it was ready to be used. Since completing the Patoka project, Cottages NZ has gained further knowledge about the education sector. It developed a strategic partnership with highly respected school furniture company Furnware along with technology experts Eastek and local fibre company UnisonFibre. Furnware’s managing director Hamish

M eet the cla ssr oom of the fut ure

Find out mor e at 32

THE

Whyte, a highly respected innovator, suggested that for Cottages NZ to gain traction in the sector, a wise move would be to develop a prototype classroom, which could be taken

“We built a classroom for Patoka

We only had to do site preparation and then it was basically dropping off the building and within 24 hours it was ready to be used. The company has researched classroom design over the last four years and has invested significantly in the last 18 months including increasing its production footprint with a new purpose built construction facility in Maraekakaho Road, Hastings.

on-site construction, with 90 percent of the work done off-site.

www.cottagesnz.co.nz

OCTOBER - DECEMBER 2011

around the country. The idea stuck with John and he approached the Hawke’s Bay Principal Association to see if a classroom would be welcome at their annual conference in Taupo. First though he held an open evening at the new construction facility and further information was gleaned from principals, teachers and board of trustee members.


E

The response was overwhelming but the deadline was tight. However within 6 weeks a 46.8sqm

attending was fantastic.

The key advantages of building offsite are • Minimal disruption to the School, staff and pupils. • Higher quality control. • Reduced and guaranteed construction time frames.

modern learning environment with the latest in classroom furniture, IT infrastructure and learning technology, matched by the latest design features including non graffiti external cladding, was on a truck and making its way to Taupo. John says his business is challenging conventional construction methods. CNZ has with the support of Tech NZ funding, designed four production types – transportable, modular (which links a series of buildings together), prefabricated panels and prefab pods (a component of buildings linked together).

• Reduced Health & Safety risks One of the major benefits for a school is the reduction of costs associated with project management and design fees. “This allows money to be spent in the right place – the classroom, through enhancing the learning environment with modern and comfortable furniture and latest technology advancements. There are also options to use solar energy as an alternative energy source providing the school with an ability to earn credits for their electricity when the class is not been used. John says the reaction from those

“They immediately got it – that they no longer needed the school to look like a construction zone. That they could choose a design and then within a short period of time, what was ordered would arrive ready to be used.

Local project managers have been asked to decide on who will build and when.

Another string to Prime Minister John Key launching the Excel Series the bow of the Excel Series is Cottages Although John has rattled a few cages, NZ’s partnership with EIT Hawke’s he’s hit a brick wall with the project Bay. In 2012 its anticipated that premanagers. apprenticeship carpentry students will build six classrooms using CNZ plans “I believe there is a great opportunity and guidance as part of their ‘real here to replace the older PMC world’ training scheme. classrooms at Schools without However the gate keepers, the Ministry disrupting the staff, pupils or learning. of Education contracted project managers are yet to be convinced. Between 300 and 500 classrooms and school buildings will be replaced throughout the East Coast from Dannevirke to East Cape over the next 5 years, with a budget of over $100 million.

“The Excel Series exceeds the Ministry of Education guidelines for construction while also taking into account the ‘Whole of Life Costs’ associated with a building during its life period. “What more could we offer, it just makes sense,” John says.

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OCTOBER - DECEMBER 2011

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PRO Ed

EIT PROFESSORS JOIN ELITE RESEARCH GROUP

EIT’s three research professors are to join a select group of influential academics assessing research projects to determine funding for tertiary educators nationwide.

BUSINESS HEAD LEADS BY EXAMPLE

Professors Roger Maaka, Bob Marshall and Kay Morris-Matthews have been appointed to expert peer review panels for next year’s Performance-Based Research Fund (PBRF) round. EIT chief executive Chris Collins says the appointments show EIT is punching well above its weight in the field of academic research.

EIT’s Head of School Business Frina Albertyn leads by example in encouraging academic staff to undertake research projects.

“Out of 269 panel members, only eight are from institutes of technology, polytechnics or wananga. Of those eight, EIT has three panel members – more than any other ITP or wananga. “Our research professors are at the top of their game and underscore EIT’s commitment to developing research and research leadership.” Dean of Te Manga Maori, Professor Maaka has been appointed to the Maori knowledge and development panel. Professor Marshall, whose research speciality is biomechanics, will serve on the health panel, while Professor MorrisMatthews, a specialist in educational history and policy, has been selected for the education panel. Over recent years, EIT has created the positions for research professors and it actively encourages and supports the research efforts of its academics.

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Dr Albertyn’s PhD research was aimed at developing a methodology that would help businesses make decisions about what e-processes to use when developing an e-Commerce Information System (eCIS). ABOVE Left to right : Roger Maaka, Research Professor for the Faculty of Maori Studies/Te Manga Maori; Bob Marshall, Research Professor for Faculty of Health and Sport Science, and Kay Morris-Matthews, Research Professor for the Faculty of Humanities, Arts & Trades.

Our research professors are at the top of their game and underscore EIT’s commitment to developing research and research leadership. Chris Collins

Research projects submitted by EIT staff members for the upcoming PBRF assessment will encompass

OCTOBER - DECEMBER 2011

the institute’s full range of academic subjects across its ten degrees.

Using e-commerce websites for trading products online is becoming an increasing important option for businesses wanting to expand. The Internet offers opportunities for running flexible and adaptable sites for buying and selling goods electronically, and also for executing financial processes using e-Commerce websites or eCIS. Dr Albertyn explored four different decisionmaking methods in her research project. Each method was applied to a business in Hawke’s Bay – an event management company, a quilting business, a packaging company and a kayak shop.

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PRO

Feature

BUILDING HIS WAY IN BUSINESS

Simon Lack

Preparation and planning is the way to gain a flying start to your business venture.

t

By Lawrence Gullery

Hawke’s Bay boat builder Simon Lack’s ultimate goal is to see his vessels cross the finish line for Olympic gold in the hands of the New Zealand rowing team.

“I had particular sections I was interested in but the judges asked me different questions which made me really think about things like intellectual property, cash flow, and summarising those details, which is very hard,” Simon says.

And thanks to the inaugural ANZ competition, he’s one step closer to the winner’s podium and putting his fledging business on the international map.

Simon had been a competitive rower for 14 years, out of the Hawke’s Bay Rowing Club and a few years ago he thought he could build a boat that was of a high quality, was more practical and could deliver consistent results. He started putting his business together in April last year and is now working from a shed in Puketapu, built especially with enough room to construct the boats, which include fours (13 metres), double pairs (10m) and singles (8m).

Simon was awarded one of the 16 regional prizes, valued at $3000, in the business plan competition. His application was among 500 received by judges who had to select those which best showed they had growth and export potential. “I had just finished my own business plan and so had a good idea on what I wanted to submit. It’s good enough to come up with a business plan but writing it down on a piece of paper and explaining it to people is a different story. RURAL RETAIL CHATTELS MORTGAGE INDUSTRIAL INSURANCE RESIDENTIAL COMMERCIAL

“I don’t have a website at the moment so I’m looking to set one up and also use the money for social media, which really gives you a borderless market.”

Simon Lack, outside his workshop near Puketapu, Napier

He’s already allocated his prize money; one third will go towards building capital, another third towards building his first website for his SL Racing business and the final third will go towards legal fees.

Simon is using his network in the rowing industry to help market his products with an eye firmly on exporting to Australia this summer and later on US and Europe. Simon says the initial focus is on the domestic market and building towards plans to provide the New Zealand rowing team with a fleet of boats for

international competition. “Most boats used by New Zealand are German or Italian … but building boats for them is probably in my plans in five year’s time. For now it’s about building a consistent, reliable boat.”

Simon’s Business Plan Tips • Identify the key issues and problems your business will face and how you plan to tackle/resolve them. • Think about what the business short term and long-term goals are, how you can achieve those goals and a timeframe to reach those goals. • Have confidence in your work and believe in your business, have perseverance. • Have a mission statement which outlines what you want to achieve. Put it on display for staff to see.

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OCTOBER - DECEMBER 2011


PRO

Motoring

A BIG MINI, IS THAT AN OXYMORON?

Well previously a Mini was only big if you were small in stature but the latest addition to the Mini fleet - the Mini Countryman is a BIG car.

Review by Damon Harvey

The Mini family now has an impressive new big brother, in fact it’s a five door powerhouse that can juggernaut with the best of them. In a hectic weekend, the silver Mini Countryman Cooper S from Jeff Gray BMW was used like any typical stationwagon. It was even used as a wedding party vehicle! The Countryman must not have been sighted by too many people yet as most people who asked about the car were surprised that it was a Mini.

flipside of this ought to be that the Mini is no longer miniature, and therefore shouldn’t drive like a Mini is expected to.

$3000 add-on, it can send up to 100 percent of drive to any one wheel as and when traction is lost.

The 2011 MINI Cooper Countryman is offered in four models: Cooper, Cooper S, Cooper S ALL4 or D ALL4.

With its transverse engine keeping the weight well behind the front wheels, making the nose lively and responsive to steering input, and despite a 10mm increase in ride height there is a

The system works as both a safety feature and performance tool, providing excellent levels of grip and go in conjunction with Mini’s suitably noninvasive dynamic stability control (DSC).

Standard safety features consist of dual front airbags, front side airbags, curtain side airbags, tyre-pressure monitor, anti-lock brakes with brake assist, traction control and electronic stability control.

Mini claims that the Countryman’s boot is bigger than that of a Golf, and that its rear space is more generous than the BMW X1. Damon Harvey

What struck me about the car – was the roomy interior – both in the front and the back. Mini claims that the Countryman’s boot is bigger than that of a VW Golf, and that its rear space is more generous than the BMW X1.

The Countryman is an attractive package. It’s genuinely practical, seems to be a good drive, is a highly desirable product in what is arguably a rather indifferent segment of the market, and should hold onto its value better than many of its less exciting rivals.

QUICK FACTS

MINI Countryman Cooper S

Output: 135 kw (184hp) @ 5500rpm

The other feature that struck me was its roundness and roundness of display units. The speedometer was nearly overkill! It’s huge and could easily feature on the wall at home as a clock!

Torque: 240Nm @ 1600 – 5000rpm Acceleration The Mini Countryman with its spacious interior

The biggest challenge to earn the right to be a Mini is how it drives.

conspicuous absence of body roll in tight, fast corners.

The clever team at Mini headquarters must have spent a lot of time pondering how to pull this off and the Countryman has earned its emblem.

And a potential boon for the Cooper S, and Cooper D alongside it, is the option of Mini’s ‘All4’ four-wheel-drive system.

Big achievements in bigness.

The

So what’s the verdict?

The Countryman remains in essence a front-wheel-drive car, but with this

Along with the new model comes an enhanced engine for the top Cooper S model, making 184 hp with a dual-scroll turbo, direct injection and variable valve timing to ensure that the performance enhancement does not cut into fuel economy.

(0-100 km/h): 7.6 sec (man) Top speed: 227 km/h Fuel consumption (combined): 6.6 l/100 km (man) CO2 emissions: 154 g/km Price: $57,200 incl. GST (man) – add $3k for auto

OCTOBER - DECEMBER 2011

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PRO

Feature

SMART METERS ARE COMING Hawke’s Bay lines company Unison is confident consumers will not see big changes in their power bills when it starts rolling out smart electricity meters early next year. by Catherine Wedd

The plan is to replace the century old analogue meters with digital smart meters giving consumers real time, accurate information on their power consumption. Unison believes a fragmented approach to using smart meters will mean the full benefits won’t be realised. That’s why it’s the logical party to own and operate the smart meters, so consumers can access not only better information, but better network reliability and access to a more competitive retail market. Unison’s commercial manager, Jonathan Kay says Unison’s approach will be cautious: “we want to do a good job and do it right”. It will be the first time Unison has direct contact with its customers. Greenmeadows will be the first suburb to have smart meters installed and the company has begun talking with residents who it says so far have are

very receptive. All going well, smart meters will then be deployed across the region over two years. “People have been suspicious about (what will happen to their) power bills in the past but smart meters are a good way of keeping customers informed,” Jonathan says. Unison has invested $40 million in its Smart Grid initiative, and will use its own contracting team to install the meters, power retailers will then be charged to use the data. Consumers should not see any change in their power bills, says Jonathan. “It will be up to individual retailers to charge consumers for their smart meters. But we are conscious of making sure retailers manage tariffs properly. ” Energy retailer TrustPower, which has over 2000 customers in Hawke’s Bay, doesn’t believe smart

People have been suspicious about (what will happen to their) power bills in the past but smart meters are a good way of keeping customers Jonathan Kay informed. meters bring advantages and says it will keep analogue meters and continue with meter readers.

negotiating with Unison to use its smart meters. But the other big player in the region isn’t. Energy Online, a subsidiary of Genesis Energy has over 20,000 customers here and will install lines company Vector’s “advanced smart meters”. This is the technology that sparked controversy on TVNZ’s Fair Go programme when a customer received a very high bill from an advanced smart meter reading. Genesis said the bill was accurate.

TrustPower communications manager, Graeme Purches says “there is no real return on investment for consumers or retailers and there are already issues with the technology. Customers’ bills have gone up and data has been billed to the wrong address.” However, Consumer New Zealand’s Bill Whitley says: “the only reason power bills have escalated is there is no such thing as an estimate when you have a smart meter. Consumers are getting real readings and that is not the smart meters fault.”

Richard Gordon spokesperson for Genesis Energy says 3000 of its Hawke’s Bay customers already have these smart meters.

HBP ICP Count by Retailer Contact Energy Genesis Energy Energy Online

40000

30000

20000

Mercury Energy Meridian Energy TrustPower

10000

Bay of Plenty Electricity King Country Energy

Jul-11

Sep-10

Nov-09

Jan-09

Mar-08

May-07

Jul-06

Sep-05

Nov-04

Jan-04

0

supplied by TrustPower

The watchdog initially didn’t support smart meters because consumers were not getting any more information than what they had before. However it says Unison’s smart meters initiative should benefit consumers because the company is also planning to create a webpage for customers to monitor their electricity consumption more efficiently. Contact Energy, which has nearly 50 percent of the market in Hawke’s Bay, has confirmed it is

Jonathan Kay

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OCTOBER - DECEMBER 2011

Major retailer Meridian Energy, who right now has little market share in the region, says its negotiating with Unison to use its smart meters. Meridian says its successful trial of Arc Innovations smart meters in Central Hawke’s Bay three years ago led to Meridian’s recent rollout in Christchurch. Meridian’s retail manager Bill Highet says: “we learnt people don’t like estimated bills. Smart meters are the only way forward.


PRO

Feature

LOCAL TELECOM BUSINESS HUB A STRONG PERFORMER Hawke’s Bay’s Telecom Business Hub is one of the strongest performing of its kind in the country. by Damon Harvey

Telecom Business Hub owner Simon Fletcher says the top performance can be attributed to the new streamlined services by Telecom and a local approach backed by familiar faces.

stronger relationships with its existing customer base.

market, those with between one and 20 employees.

“Telecom spoke with a number of their customers and asked them what makes us stand out from the competition. Our customers said they wanted to deal locally, they want it to be easy, reliable and ensure we are

The Hawke’s Bay team meet with businesses from Wairoa to Takapau when and where customers want. In total there are 30 Business Hubs throughout New Zealand. In the past this has been a market that has been

Five years ago you would have paid $5000 for hardware on-site, now similar software is available free and can be accessed on the go through a smartphone. Simon Fletcher

capable of delivering the service they want. Simon has been in the telecommunications game for over 10 years and prior to securing the Business Hub license for Hawke’s Bay late last year, he operated the Telecom ORB store.

Since February Simon’s team have completed a number of health checks and bundled up a range of telecommunication solutions combining mobile, voice, data and IT solutions.

He says the fresh approach by Telecom will see his team focus on building

Telecom Business Hub Hawke’s Bay is focused on the small business

starved of support and many have had a range of telecommunication products and services spread across a range of providers. “In the past these customers would have had to call 126 for support but we have such fantastic resources at our finger tips that we don’t just drop off the box and leave it to the customer to figure out. It’s about learning about the business and finding solutions.

The team at Telecom Business Hub Hawke’s Bay - left to right are Amanda Dumbleton, Simon Fletcher, Jonathon Taylor, Tash Nelson, Julie Brenchley, Di Graham and Jeremy Burkett.

“The team have been in the dealer channel for a very long time – they are the experts.” Simon says the future is all about convergence of technology and he says you only have to look at the development of Android and Google’s investment in open source (and free) software. “Five years ago you would have paid $5000 for hardware on site, now similar software is available free and can be accessed on the go through a smartphone. “You can sync Outlook on the fly and can access cloud based information straight to your smartphone,” he says. Fibre will be another important step.“It’s early days for fibre, it’s like a field of dreams, build it and they will come; we just don’t know what services will come from it.” He also predicts a massive increase in Voice Over IP (VOIP). “VOIP and cloud computing will just take off,” he says. The Telecom Business Hub in Napier’s will be officially opened on November 16.

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Business

THE IMPORTANCE OF HAVING A PLAN

Feasibility studies are an important tool for assessing new business opportunities, both start-ups and new initiatives aimed at growing existing businesses – and they perform a critical role in guarding against wishful thinking! By Cedric Knowles | KNOWLedge Accountants

A lot of decisions are made by owners who are immersed in the day to day demands of the business - they haven’t stepped back, thrown away the rosetinted glasses and put the time into objective analysis of the opportunity they are presented with.

A recent incident in the Knowles house got me thinking. One of our boys has a goldfish tank in his room and late one night, almost with a sense of premonition, my wife popped her head in to check on him and the tank, to find that the two goldfish had vanished.

A well-executed feasibility study doesn’t just address if a project is feasible or not, but also should help determine what course of action is most feasible, and become the starting point for your actual business plan.

After waking our son and finding that he had no idea where they had gone, we woke the girls in the next room. The small child (our perfect one!) happily admitted that she was friends with the fish, that they were cold and wet, so she had snuggled them up in bed! And there they were, in the spare room, their fish heads on a pillow and a duvet keeping them warm!

The main reasons for carrying out a feasibility study are: • Gives focus to a project and outlines alternatives. • Narrows down business alternatives • Identifies new opportunities through the investigative process. • Identifies reasons not to proceed. • Enhances the probability of success by addressing and mitigating factors that could affect the project early on. • Provides quality information for decision making.

Sadly the fish did not survive, and I have seen similar results in business when the consequences of what seemed to be a good idea were not fully thought through - the essential components of a feasibility study were missed.

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1. Market Analysis A product or service is likely to be feasible if it can be shown that there is sufficient market demand - that is, that you can show there are enough customers in your target market who will purchase a sufficient quantity of your products or services at a price that is required to generate a profit. I have seen many business owners fall into the trap of confusing enthusiasm with reality - they are convinced that their product is so much bigger and brighter and better than the competition, that they believe they can enter a saturated market and survive – a very risky proposition!

2. Economic Environment Analysis Economic feasibility should include analysis of current government fiscal and monetary policies, where exchange rates and inflation rates might be heading, to assess whether the business can be competitive in the economic environment.

3. Technical and Personnel Analysis Technical and operational feasibility is met if a company has the necessary expertise, infrastructure and capital to develop, install, operate and maintain the proposed business activity. Is there sufficient access to resources? One of the main reasons that new businesses fail is under-capitalisation - not enough money to keep the business going from start-up until it starts to make a profit, which often leads to a lack of resources.

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• Provides documentation that the business idea was thoroughly investigated. • Helps in securing funding from financial institutions and other lending sources. • Helps to attract equity investment Following is a very brief, and somewhat generic outline of what you should endeavour to include in a feasibility study:

OCTOBER - DECEMBER 2011

4. Financial Analysis Financial analysis must show that the profit or benefits from a project exceeds

its costs, to a degree where there is sufficient return on investment. Some of the factors to be assessed are: • What are the total start-up costs needed for the project to commence? • At what level can your products or services be priced and what are the margins over direct cost at each of those levels? • What is your expected demand, and therefore total sales revenue at each price point? • What are the day-to-day overhead operating costs? These questions will help you calculate the economic viability and cashflow requirements of the business.

5. Sensitivity and Risk Analysis I believe this is one of the more important areas overlooked with a lot of business ideas – the big ‘what if’ questions. Sensitivity involves checking how the results might change with movements in your variables such as volume, price, new competition, interest rate changes etc. Risk analysis aims to assess what factors could derail the project, for example lack of support from management, failures in your supply chain or negative market publicity. So when you are planning something new, think through all of the requirements for it to be feasible, and don’t be blinded by your own enthusiasm or perceptions – as in the case of our goldfish, a quick analysis would have ascertained that lack of water was not going to result in a good outcome, no matter how good a nice snuggly warm bed might seem! There is quite a handy little tool online that can be used as a first ‘filter’ for your next idea http://www.i2monline.com/ evaluation.php Cedric Knowles is director of KNOWLedge Accountants, Hawke’s Bay. He has worked as an accountant in the Bay since 1987. Contact Cedric by email: Cedric.Knowles@knowles.net.nz


PRO

Finance

Disclaimer “The opinions expressed in this article are those of Stewart Group’s advisers and should not be considered as advice. Investors should obtain professional advice regarding their own financial circumstances and objectives before making any investment decision. Under the Financial Services Act 2008 a copy of our Disclosure Statement is available on request and free of charge."

A WINNING INVESTMENT STRATEGY

News, like the share markets can be unpredictable. The recent volatility in the markets has demonstrated this, but that’s the way financial markets operate – they have periods of both downward and upward movements. By Nick Stewart | Stewart Group

Volatile markets can be an emotional rollercoaster for some investors and can bring a range of familiar emotions to the surface, including a strong urge to try to time the market. The temptation, as always, is to sell into falling markets and buy into rising ones. Investors who are perceived to be ‘wellinformed’ - those who regularly monitor the financial papers - are the ones who feel most compelled to try and time their exit and entry points. The suspicion that ‘sophisticated’ investors are the most prone to try and outwit the market was given validity recently by a study, carried out by London-based Ledbury Research, of more than 2,000 affluent people around the world. The survey found 40 percent of those who were questioned admitted to practicing market timing rather than pursuing a buy-and-hold strategy. Interestingly, the market timers were more than three times more likely to believe they traded too much. “On the face of it, you might think that those who were trading more actively would be more experienced,

Whilst there are things you can’t control (such as the ups and downs in the markets), an adviser will show you there are things that you can control. This includes ensuring your investments are properly diversified - both within and across asset classes, ensuring your portfolios are regularly rebalanced to meet your long-term requirements, keeping costs to a minimum and being mindful of taxes.

sophisticated and able to control themselves,” the authors said. “But that seems not to be the case - trading becomes addictive.” These behavioural issues and how they impact on investors are well documented by financial theorists. Commonly cited traits include lack of diversification, excessive trading, an obstinate reluctance to sell losers and buying on past performance. Mostly, these traits stem from over-confidence. We all tend to think we are above-average in terms of driving ability and we also tend to over-rate our capacity for beating the market. This ego-driven behaviour has been shown to be more prevalent in men than in women. A study quoted in The Wall Street Journal showed women are less afflicted than men by over-confidence and are more likely to attribute success in investment to factors outside themselves – like luck or fate. As a result, they are more inclined to exercise self-discipline and to avoid trying to time the market. What often stops investors getting returns that are there for the taking

And of course, remaining focused and disciplined – particularly in times of adversity when markets are volatile. Ultimately, discipline is the way to building long term wealth and a winning investment strategy.

are their very own actions - lack of diversification, compulsive trading, buying high, selling low, going by hunches and responding to media and market noise.

So how do you remove egos and emotions from the investment process? One way is to create some distance from the daily noise generated by the media and work with an adviser who focuses on your long-term interests.

Nick Stewart is an authorised financial adviser (FSP21383) and specialises in providing advice to wealth management clients. To contact Nick email: Nick@stewartgroup.co.nz Data Sources: Dimensional Fund Advisors June 2011 Risk and Rules: The Role of Control in Financial Decision Making’, Barclays Wealth, June 2011 Barberis, Nicholas and Thaler, Richard, ‘A Survey of Behavioral Finance’, University of Chicago ‘For Mother’s Day, Give Her the Reins to the Portfolio’, Wall Street Journal, May 9, 2009

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Customer

SURVEYS, POLLS AND FOCUS GROUPS Benchmarking is a must-use tool if you want to record how well your business is travelling. By Virgil Troy | SIL Research

We’re fast approaching election season, a time when it seems every political issue is under the microscope of public scrutiny and we are bombarded with opinion polls and political research. Regardless of the research outcome, we can be assured of two things: If the polls are in favour of any party then we’ll hear “we enjoy a comfortable lead in the polls”. If the polls are not so rosy for a given party we usually get “… you can’t necessarily rely on the accuracy of opinion polls”.

to vote for?”. Qualitative research is concerned with exploring issues in depth i.e. “Why do people vote a particular way or think the way they do” or “How people feel about a given an issue or topic”. These research approaches are usually complementary; researchers may explore reasons why people vote in a particular way via a focus group, then measure how important these reasons are in a poll or survey and vice versa. We’ll now review three common methods used to collect political opinion data.

population wants or thinks. Surveys can be either quantitative or qualitative in their approach.

Focus Groups: A focus group is

a qualitative research approach where subjective opinions and perceptions of a small targeted group of the public on a certain topic is solicited. Focus Groups are usually made up of 6 to 8 targeted consumers (but they can be larger or smaller depending on the issue in question). A focus group is an interview, conducted by a researcher among a small group of respondents. Focus groups are great for exploring

Then there’s the jargon; 'confidence levels', 'error margins', 'focus groups', 'polls', 'recent surveys' or 'a survey of voters' and so on. To help you navigate your way through the jargon and hopefully make some sense of the research here are a few definitions and general research method 'rules of thumb' to guide you.

To help you navigate your way through the jargon and hopefully make some sense of the research here are a few definitions and general research method “rules of thumb” to guide you.

Type of research: Market or

discuss as we have all at some stage come into contact with a survey either over the phone, online or face to face. A survey is a standard way in which researchers gather market or political information. The general aim of a survey is to collect information from a smaller group of respondents in order to be able to predict what the

political research can generally be divided into two types of research; quantitative and qualitative research: Quantitative research is about getting the facts and stats in relation to an issue or question i.e. “Who is your preferred Prime Minister” or, “On election day, what party are you likely

Virgil Troy

Surveys: This is the easiest to

Strategy, Intelligence, Leverage

issues in depth, but they cannot be used to state the views of the general population; for that you need polls.

Polls: A political poll is a quantitative

approach which uses a typical sample size of around 500–1,000. Anything less than 400-500 and the chance of the results being inaccurate are higher. It is important to note that a sample size greater than 1000 to 1200 does

not necessarily mean the result will be more accurate. Polls are ideal for addressing a few issues across a large group of people, quickly.

Confidence levels (intervals), margins of error: We often hear how a poll is

95 per cent accurate with an error margin of + or - 3 per cent. A 3 per cent margin of error means if the same research was conducted over and over again, 95 per cent of the time the outcome/result of the poll would be the same, plus or minus 3 per cent. If we polled 1200 people and 80 per cent of them stated “Mr Lock” as preferred Prime Minister with a result that was 95 per cent accurate + or - 3 per cent, it would mean if we had run the same survey in multiple instances within the same survey period, 95 per cent of the time the result would have been the same + or - 3 per cent. Ultimately who you vote for is up to you, so make sure you get out on voting day and tick your preferred candidate and party.

Dr Virgil Troy has a PhD in Customer Relationship Management and is Managing Director and principal researcher for Napier based market research firm, SIL Research. To contact Virgil email virgil@silresearch.co.nz

Online surveys Opinion polls Satisfaction surveys Benchmarking Telephone interviews Focus groups

Locally owned, Napier based, New Zealand wide research services Ph: 834 1996 e:queries@silresearch.co.nz

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PRO

Culture

BNZ’S TOP MAN IN MAORI BUSINESS EXCELLENCE The Profit was at the Takitimu Indigenous Peoples Business Conference in September where it caught up with a senior lawyer who is BNZ’s first Head of Maori Business.

By Lawrence Gullery

Expect to see more of Pierre Tohe in Hawke’s Bay over the next couple of years. The Waikato man, a senior lawyer at BNZ for seven years, earlier this year accepted a role to head the financial institution’s new division dedicated to Maori business. His Maori language skills and knowledge of tikanga Maori have been much sought after at BNZ and his new job is a chance to marry his love for Maori culture with his career aspirations. Pierre is charged with driving and coming up with the Maori business strategy for the bank, bringing together the retail side and the BNZ Partners side,” Pierre says. “Part of my role is making sure BNZ has a good grasp of what’s happening (with Maori enterprise and customers) around the country so we can create one space to build an excellence for Maori business.

“It’s also about making sure every staff member in BNZ has had the opportunity to learn Maori culture.”

investment in a term deposit and it’s a matter of educating Maori about the options out there. There are some low-risk investments that you can consider.”

He is aware that in Hawke’s Bay, two Ngati Kahungunu hapu settlements, worth more than $40 million, had

For other hapu groups, like his own

Most people would put their investment it into a term deposit and it’s a matter of educating Maori about the options out there Pierre Tohe

moved to agreement in principle stage with the Crown over the past year. There are likely to be four more hapu settlements to come to fruition over the next few years.

BNZ Head of Maori Banking, Pierre Tohe

policies which could offer more lending opportunities for projects and development on Maori land. Major work on surveying and registering title of Maori land has been made in an effort to reach the level of lending criteria required by banks. “There is a lot of Maori land which isn’t being put to use because it doesn’t meet lending criteria. If we can move that to something that is a bit friendlier to Maori, I would say that would be one of my main goals.”

in Waikato, it is a matter of offering advice on economic growth.

“A lot of the hapu settlements are cash plus assets and yes while the bank is here to make money, we also have a lot of really good skills to help people manage their commercial properties or look at investment options.

“We have received our settlement but now our marae are into writing economic development plans and it’s our job to understand what the iwi and hapu are doing and what they want to achieve,” Pierre says.

“Most people would put their

Another priority is working on new

Ngati Kahungunu Iwi chairman Ngahiwi Tomoana, at the Takitimu Indigenous Peoples Business Conference.

ATTN10TPR03#3RUD

• PRIMARY INDUSTRY MANAGEMENT • RURAL RECRUITMENT & HR EXPERTISE

w w w. r u r a l d i re c t i o n s . c o . n z OCTOBER - DECEMBER 2011

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Property

REVIEW OR NOT REVIEW THE RENTAL QUESTION

For any first time Landlord or Tenant negotiating a lease can be fraught and it pays to get some good legal advice, check things out before signing any documents. By Paul Harvey | Williams’ Harvey Registered Valuers

This is a very subjective process that often gives rise to quite divergent opinions on what the current market rent is. Consequently, I endorse the view that regular rental assessments keep the lines of communication between landlords and tenants open and that is why it is important for both parties to observe rent review dates. There are two main reasons, firstly, it ensures that the property owner maximises their return from their property asset and secondly, it ensures that the tenant does not suffer from any major increases in their occupation costs which can happen if rents are not reviewed for a number of years. For any first time landlord or tenant negotiating a lease can be fraught and it pays to get some good legal advice, check things out before signing any documents. Such as, insist each side pays its own legal fees to draft and register the lease, check out if there is a ratchet clause which allows for rent increases, never a rent drop. A rental assessment from a Registered Valuer is important because it allows you, whether you are the landlord or the tenant to negotiate the terms of the lease based on current market rates.

The concept of “current market rent” is as much a legal concept as it is an economic concept. Current market rent is defined as by the Property Institute of New Zealand (PINZ): The estimated amount for which a property, or space within a property, should lease on the date of valuation between a willing lessor and a willing lessee on appropriate lease terms in an arms length transaction, after proper marketing wherein the parties have each acted knowledgably, prudently and without compulsion.

The main method of determining current market rent is to identify new lettings and reviews of similar space, analyse these rents to an effective rate per square metre (by making allowance for inducements), then relate those rental rates to the subject property by adjustments for such variables as location, size, lease term, space, building quality and the provision of various services. Comparable rents are analysed on a ‘Gross’ basis or ‘Total Occupancy Cost (TOC), with any lessee outgoings then being deducted from the TOC figure to determine the net rent. The majority of commercial leases use a standard Auckland District Law Society (ADLS) format and allow for periodic reviews of the current rental. The process which both lessor and lessee must follow will be outlined in the lease.

Waggs & Amy

The general form is as follows: • At a date specified before the rental is due to be reviewed, the lessor (landlord) gives the lessee (tenant) notice of the new current market rent. This advice is usually supported by a valuation from a Registered Valuer.

• If the lessee disputes the figure sought, they can obtain their own independent valuation advice and must respond to the lessor in writing within a prescribed timeframe.

• If both valuers are still at odds with each other, with the written authority of their principals (lessor & lessee), they can meet face to face and try and resolve the difference. This is in effect a form of mediation.

• If the valuers are unable to resolve their differences, then in accordance to the process set down in the lease, the valuers may appoint a third expert to act as an umpire to set the rent or the parties (lessor and lessee) will appoint an Arbitrator who will conduct an arbitration in accordance with the Arbitration Act 1996.

From a cost perspective it is usually advisable to avoid this last step, as taking a dispute to arbitration can be relatively expensive, takes time and can cause anxiety levels to rise. There is also no guarantee that any one party will have a 100% win. Like any litigation process, it is always a bit of a gamble. Generally both parties must equally share the cost of the umpire along

The Morning Fix Weekdays from 6AM

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OCTOBER - DECEMBER 2011

with the fees of their own valuer. It is therefore important to ascertain whether the value of the amount in dispute exceeds the likely cost of the exercise. Many tenants appear reluctant to observe rental assessments as they think the landlord will put up the rent. However, regular reviews also ensure that the tenant does not suffer from any major increases. This can occur when rental assessments are not observed for long periods and can mean substantial rental increases. Drastic increases usually end up in arbitration. We have a database call-up notification system that gives clients three months notice for rent reviews and lease expiry dates. We also have a large database of rental evidence which assists us when assessing a market rent. We assess the current market rent of the property and compare this to the passing rent to ascertain whether there should be any rent increase at the review date. Experience has taught us it’s about being fair and keeping good relations between property owners and their Tenants, as both have obligations to fill. Keeping lines of communication open on a regular basis means less chance of a disagreement between the parties which means that rather than disputing rental levels, each party can get on with what is important - their business!!


PRO Legal

LEASE RIGHTS OF RENEWAL & TENANTS RIGHT TO FAIL Many commercial leases require a landlord to renew a lease if called upon by the tenant to do so. The standard ADLS lease will require the tenant to provide notice in writing to the landlord within a timeframe stipulated by the lease. By Emma Dawson | Bramwell Grossman Lawyers

Upon receipt of this notice, provided the tenant has paid rent on time and otherwise complied with the terms of the lease, the landlord grants the renewal and both parties record the same in a deed of renewal.

But what happens if the tenant forgets to give notice in accordance with the lease? It is not uncommon for tenants to simply forget to give notice in accordance with the lease. When this happens, in some circumstances the conduct of the parties determines whether the lease has been renewed by implication. This may involve e-mails, letters or verbal communications between the parties recording that the right of renewal has been exercised.

What happens if the landlord tries to cancel the lease because the tenant has failed to give notice? In the event of no such communication, the parties may wish to rely on the status quo to prove the right of renewal has been exercised. If the tenant remains in occupation of the premises

and continues to pay rent in the usual manner, the landlord, by accepting such payment, may be deemed to have accepted that the tenant has exercised the right to renew the lease on the same terms. If at some later date the landlord gets a better offer or wants the premises vacant for some other reason, the landlord may attempt to cancel the

lease based on the fact that the lease has not been formally renewed and is on a month to month basis (due to the current economic climate, it is probably more common place for a struggling tenant to attempt this). If this happens, the tenant can apply to the court for relief under the Property Law Act 2007 within three months of receiving notice from the landlord.

What will the Courts take into consideration when deciding whether to grant either party relief? In deciding whether to grant relief, the following factors will be taken into consideration: (a) reasons for the tenants failure to give notice to renew the lease. In most cases, the tenant has simply forgotten to give notice. The old adage ‘out of sight out of mind’ applies and a Deed of Lease which may have been signed and filed away, in some cases years ago, is simply overlooked. (b) whether the landlord has contributed to the

failure. Recent court decisions suggest that the onus is on the landlord to make enquiries of the tenant as to whether they wish to renew the lease when the time comes for the notice of renewal to be given. (c) whether the tenant has been a good tenant and complied with the terms of the lease. If the tenant is frequently late in paying their rent or has not complied with the terms of the lease in another way, the court is likely to be reluctant to grant relief. (d) the landlord’s reasons for refusing to renew the lease and whether they knew the tenant would have wanted to renew the lease. This will be dependent on the circumstances.

A word of warning This article is intended to be a general comment on a sub-part of the law surrounding renewals of leases. As the wording of renewal clauses and surrounding circumstances differ from lease to lease, contact the team at Bramwell Grossman for advice specific to your situation. Emma Dawson is a partner at Bramwell Grossman Lawyers in Hastings. She has a Bachelor of Law from Otago University. Emma specialises in commercial law, asset planning, trusts and succession planning. To contact Emma – eeld@bramwells.co.nz

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Out & About

Port of Napier Hall of Fame Three business legends were inducted including New Zealand Aerial Mapping founder Henry Piet Drury van Asch (CBE), Tobacco Company founder J. Gerhard Husheer, and legendary wine maker Thomas Bayne McDonald. Guest speaker Bruce Mactaggert (right) gave an insight on what’s great about Hawke’s Bay.

Logan Stone Chamber after 5 Hawke’s Bay Valuation firm Logan Stone held a Hawke’s Bay Chamber of Commerce after 5 function at its premises in Hastings recently. Logan Stone is also celebrating 25 years in business.

Launch of the HB Maori Business Network Directory The 2011 HB Maori Business directory book and website were launched at the BNZ Partners premises in Hastings.

NZCU Baywide AGM NZCU Baywide held its AGM in Hastings, which also combined with the organisations 40th birthday celebrations. The credit union has undergone a brand revamp recently and posted a strong profit.

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THE

OCTOBER - DECEMBER 2011


PRO

Out & About

Indigenous Peoples’ Business Conference: Business leaders from around New Zealand, the Pacific and North Canada presented at the conference which was run as part of the Takitimu Festival in Hastings in September.

HB A&P MERCEDES-BENZ WINE AWARDS JUDGING

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PRO Diary

p p e n in g ? what’s ha

Oct 19: Business After 5, A&P Society President’s Tent, Hawke’s Bay Showgrounds. October 19 to 21: Hawke’s Bay A & P Society Show, Hawke’s Bay Showgrounds, Hastings.

Do you have a business event you want to tell the rest of the region about? Email your diary listing to damon@attn.co.nz

Nov 5: Ngati Kahungunu Sports Awards, at the AW Parsons Stadium River Terrace, Waipukurau, phone (06) 858 8507 or 845 9333 for more information. Nov 7: Hastings Young Achievers Awards, Hawke’s Bay Opera House, Hastings. Nov 7: Westpac Hawke’s Bay Secondary School Sports Awards, Napier Municipal Theatre www.sporthb.net.nz Nov 9: Business After 5, Kitchen Studio Christmas Function.

Oct 23: Rugby World Cup Final, fan zones set up at the Napier Municipal Theatre, in Napier city and the Hawke’s Bay Opera House in Hastings. Entertainment starts at 7pm with the game kicking off at 9pm. October 25: Hawke’s Bay Signature Dish Awards. Nov 2: Lion Foundation Young Enterprise Scheme Awards (YES), held at the Mission Estate Chapel.

Nov 3: Westpac HB Chamber of Commerce Business Awards Cocktail, Awards Ceremony and gala dinner at HB Opera House, Hastings. Come and celebrate with the winners of the 2011 Westpac Hawke’s Bay Chamber of Commerce Business Awards. Tickets available at www.hawkesbaychamber.co.nz Nov 5: A day on the Green with Steely Dan, Church Road. For more info www.adayonthegreen.co.nz

Nov 11: Institute of Architects Regional Awards, Gisborne and Hawke’s Bay, at the Hawke’s Bay Opera House in Hastings. Nov 12: Danks Hawke’s Bay Sports Ball, Rodney Green Centennial Events Centre, Napier. info@murphyevents.co.nz or 027 2970238

Dec 10: Official results for General Election 2011 and referendum released. Dec 10-Jan 10: Opti World Champs, Napier, Invitation Regatta, www.optiworldsnz.org.nz

Nov 12: Kai in the Bay, The traditional Maori and Wild Food Festival held in Ahuriri, Hawke’s Bay. The festival will not only showcase a variety of traditional Maori kai, pre / post European, and outside the square wild food, but there will be art, music and lifestyle displays for all to enjoy. Fresh whitebait fritters, mouth watering crayfish or drizzling pig on the spit. For more info www.kaiinthebay.co.nz Nov 26: General Election 2011, Polling is open from 9am to 7pm. Preliminary results will be released from 7pm onwards. All advance vote results for general election and referendum released by 8.30pm.

Dec 27 – Jan 6: Black Barn Open Air Cinema www.blackbarn.co.nz Dec 30-Jan 10: Opti World Champs in Napier. For more info www.optiworldsnz.org.nz Jan 14: Blues Brews & BBQ Festival, Waikoko Gardens, HB Showgrounds, Hastings. Tickets available from www.bluesbrews.co.nz Feb 10: Accelerate Conference, Entrepreneurs and business owners get together and share stories, and experience. More discussion than lectures Accelerate provides the forum to talk about what really works and share those anecdotes that make the difference. At the Black Barn in Havelock North. For more information http://0to60.

EDITOR/PUBLISHER: Damon Harvey 06 878 3196, 021 2886 772, damon@attn.co.nz Twitter - @profithb

THE PROFIT is independently owned by Attn! marketing pr and is published four times a year. Copyright ©2011: Attn! marketing pr

SENIOR JOURNALIST: Lawrence Gullery

All material appearing in THE PROFIT is copyright and cannot be reproduced without prior permission from the publisher. Neither editorial opinions expressed nor facts stated in advertisements are necessarily agreed to by the editor or the publisher of The Profit. While all due care and diligence has been taken to ensure accuracy, no responsibility will be taken by the publishers for inaccurate information or for any consequences of reliance on this information.

CONTRIBUTORS: Wray Wilson, Nick Stewart, Cedric Knowles, Brett Burgess, Paul Harvey, Brent Paterson, Sue Whiteley, Emma Dawson, Dr Virgil Troy, Anna Lorck, Catherine Wedd, Kate de Lautour ADVERTISING SUPPORT: Gerard Cook 06 878 3196, gerard@attn.co.nz PHOTOGRAPHY: Lawrence Gullery, John Cowpland. DESIGN: Adam Russ & Lawrence Gullery PRINTING: FORMAT DISTRIBUTOR: Reach Media SUBSCRIPTION ENQUIRIES: gerard@attn.co.nz

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Dec 2: Stewart Group Professional Series, Post election Breakfast with guest speaker Craig Foss. Venue: Shakespeare Room, Hawke’s Bay Opera House. Time: 7.15am-9am. Cost $20. for more info go to www. stewartgroup.co.nz

THE

OCTOBER - DECEMBER 2011

Attn! marketing pr Phone 06 878 3196, Fax 06 878 3194 PO Box 8809, Havelock North 4157 Vol 07 • October 2011


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