Businessmen told to plan for survival

Press, Volume CXI, Issue 32677, 5 August 1971, Page 14

Businessmen told to plan for survival

Christchurch businessmen were told yesterda that they had five years to plan for the survival of the: firms. Mr G. W. J. Dryden, senior marketing executr of U.E.B. Industries, Ltd, told an export marketin seminar that this was the effect of the Governmen decision to phase out import control over a five-year period.

After this, New Zealand firms would be open to international competition. Mr Dryden said that the best way to meet international competition was to go out and compete with it in overseas markets, and he suggested the best place to start was Australia.

Apart from gaining this experience overseas before the crunch came in New Zealand, there were two other compelling reasons why firms should start exporting in their own self-interest, said Mr Dryden.

One was the assistance with expansion which was provided by export taxation

incentives, and the other , was the opportunity to expand production runs. Dealing with the national need, Mr Dryden said that New Zealand over the next eight years would have to increase its annual exports by about $5OO million—some 40 per cent—if it was simply to meet the National Development Conference target of a 2.5 per cent annual increase in the average standard of living. This target he described as ludicrously modest. With modem technology, New Zealand’s natural resources and greatly improved management and marketing, he believed we could double our living standards within 10 years. POPULATION RISE “Given our average annual population increase, to achieve this target would require an average annual increase of 7.5 per cent in New Zealand’s gross national product—7.s per cent in real terms, excluding inflation,” said Mr Dryden. The bulk of this would have to come from greater

processing of farm products, but even to reach the conservative N.D.C. target, nonforestry manufacturing exports would have to increase from $26 million a year in 1967-68 to $2OB million by 1978-79. However, if each of New Zealand’s 10,500 factories exported an average of $40,000 a year, manufactured exports would total $420 million. TOP 20 Obviously, said Mr Dryden, not all firms were in productfields where sizeable exports were possible, but perhaps 2000 should be. Of these, the top 20 should each aim for a minimum annual export turnover of at least $5 million within a few years, leaving the remaining 1980 firms an average of about $55,000 a year to fill out the minimum N.D.C. target of $2OB million.

Only a slight extra effort would be needed to make the N.D.C. target look like chicken feed, he said. “My own company’s exports were negligible five years ago. By 1968 we had managed to lift them to 700,000, by 1969 to $2.8 million, and in the just-com-pleted financial year they have topped $4.6 million. "And we would regard these as very modest achievements. If we don’t top the $lO million within the next few years I will be very surprised.”