Export Prospects For New Zealand Plastics

Press, Volume CII, Issue 30168, 27 June 1963, Page 14

Export Prospects For New Zealand Plastics

[By

T. J. H. SHORT,

Assistant General Manager,

Plastic Products, Hamilton]

'T'HE plastics industry ■*• has five major avenues through' which it can help to boost New Zealand’s export earnings:

☆ The export of fullyfinished products.

■& The export of product components for overseas assembly.

☆ The hiring of moulds and other production equipment which will be returned to New Zealand after overseas use.

•fr The manufacture and sale of production equipment and machinery.

•& The supply to other New Zealand exporters of high-grade packaging units and materials to up-grade the sales appeal of the products they will contain.

I believe that we have barely begun to scratch the surface of these activities and that if we do pursue these possibilities with the vigour and technical resources the plastics industry undoubtedly possesses, then the industry will make a very worthwhile contribution to New Zealand’s economic security and advancement.

One important factor . should be established at the outset of any discussion regarding New Zealand plastic export prospects: it is that this country is internationally recognised to have one of the world’s most advanced plastic moulding and processing industries in the world.

This is important because we tend, as a nation, to suffer from a severe inferiority complex when comparing the standard of our manufactured goods with comparable products produced in more industrially sophisticated countries. In actual fact, although our production volume is comparatively small, our standards are high.

Mr Lane, leader of the recent New Zealand trade mission to Australia, may have over-stressed the matter when he said that one of the inhibiting factors in increasing our manufactured exports to Australia was that our quality tended to be higher —and therefore more expensive—than required in

the market. But it is nevertheless a thought-provok-ing statement. Quality I personally believe, however,, that the quality of our manufactured goods intended for export can never be too high. But I do believe that highquality goods call for high - quality marketing procedures to make sales. For the simple fact is that every country without exception contains within it what are, by our standards, large groups of people who not only want high-quality products but also are prepared to pay well for that quality. The fact that the goods they want come from another country is, more often than not, an added attraction of no little importance.

This is not mere theorising. It is a fact which I myself and other senior executives of hay company have proved through personal market investigation in a number of countries —for example, Australia, Malaya, Britain, Europe and the United States—in recent months. '

And as a result of this and other activity, our company is exporting to these countries. We are also confident of exporting to others in the very near future. Know-How

In the context of plastics—and many other manufacturing fields —it is, I believe, of the utmost importance that we in this country broaden our definition of exports to include not only the sales overseas of fully processed goods ready for immediate sale on arrival but also our actual technical kndwhow and the physical means of production itself.

To take an example from our own experience: We are engaged in, among other plastic moulding activities, the production of blow-moulded containers—bottles, jars, jerrycanS and so ori. Now, to find an export market for these actual products would be difficult, if not impossible: it would cost far more to ship them than it costs to make them. But we have developed literally scores of complex, well - engineered moulds which can be used on hundreds of moulding machines in dozens of other countries.

Moulders in these countries are prepared to pay for the hire of these moulds, and are doing so. They do a production cycle on our moulds and return them to us—together with a royalty or hiring fee. This is income for our company and precious overseas exchange for New Zealand. Yet it did not involve the outright sale of a product: merely the use of our know-how.

Our company - along with many others, both in and outside the plastics field—has developed certain production techniques which have assisted us to raise the speed and qual-

ity of our output to lower the price. These techniques have involved the design and manufacture of special equipment, much of which has special features not found in similar equipment made anywhere else in the world' or alternatively costing less than similar equipment made elsewhere. There is a ready demand for this equipment in other countries and we are taking steps to satisfy this demand. One particular case is a range of automatic silk-screen bottle printing machinery. Now this is not exporting actual products but, rather, the means of production.

Again, it applies to many plastic moulders in this country that the cost of producing the components of certain plastic products are not high by world standards, but the cost of assembling those products—because of the labour involved—is too high to allow the finished products to be sold readily on a foreign market. In this case, is it not feasible to export only the components and to give an overseas company, operating in the desired market,

the right to assemble those products with comparatively low-paid local labour—thus allowing our products to be presented and sold overseas at a much lower price than they might otherwise be?

As a result of a recent visit to South-east Asia, where I spent a month investigating plastics markets and manufacturing techniques, I am thoroughly convinced that this process is feasible—certainly, as far as many plastic products are concerned. Well-Designed To return to the question of quality: it is a fact, and a number of New Zealand moulders ourselves included have found that overseas countries will buy our fully processed, and assembled plastic products. Examples include: housewares, electrical switches, milkingmachine cups (the first of their kind in the world), milk-flow indicators, toys, raincoats, thermostats, ahd many other products. Few were cheap by overseas standards. But all were well-designed, of topquality manufacturing standard, and novel in some fashion or other.

The question now arises: how do we export a greater volume in greater variety? There is only one answer: more of our moulders must conduct thorough on-thespot market investigations in over-

seas countries. Expensive? Not necessarily. For example, an economy-class return air ticket to Singapore costs a little over £ 200. With the special tax allowances now applicable to expenditure of this nature, that fare would cost the company only £5O in actual cash. Packaging One export activity in which I believe the plastics industry of this country could be far more active than it is at present is in the packaging and presentation of other kinds of export products.

There is an immense opportunity to improve the packaging and presentation of our foodstuffs, clothing and textiles, machine components, confectionery, Beverages and other products destined for overseas sale. Plastics —from soft wrappings to rigid containers—hold one of the major keys to this improved presentation and therefore improved sales in a wider variety of outlets.

Too many of our exports still travel overseas in limp, unattractive, and even inefficient containers which are well under par by international standards. Yet well-designed, stur-dily-constructed and high-ly-functional containers are a world “must” for successful selling.

If more exporters would seek packaging advice and assistance from plastic companies—and if more plastic companies would offer that advice and assistance on their own initiative then plastics would play a much greater role, than they do at present in raising the level of our overseas income. Containers

For example, we have barely begun to exploit the field of re-usable containers for our export products which would thereby gain greater prestige and acceptance, particularly in low - income countries, countries where “waste not, want not” is the rule of the day. r Blow • moulded and vacuum-moulded packaging has a sales appeal which glass, metal, and wood can seldom match.