SWOT Analysis of the New Zealand Chemical Manufacturing Industry
SWOT Analysis of the New Zealand Chemical Manufacturing Industry
STRENGTHS
Local manufacturers have:
Better understanding of market conditions e.g. weather variations / seasonal changes.
Better understanding of issues being treated e.g. local weed types to be controlled and chemicals to specifically target them.
Ability to supply short shelf life products e.g. suspensions where imported products may expire before arrival.
Local staff working for New Zealand owned companies who may be more committed / loyal to the company. Local staff should have better understanding of market conditions and form better relationships with customers.
Faster turn-around of raw materials into finished product resulting in:
Fresher product.
Reduced quantities to be warehoused.
Ability to provide urgent customer requests
Set up for smaller batch quantities resulting in:
Quick turn-around of production.
Reduced batch set up costs.
Superior quality compared to Asian manufacturers
Lower costs compared to European manufacturers
Proximity to Emerging Asia and Australia
Big agricultural sector
High political stability
WEAKNESSES
Local manufacturers have higher cost structure due to:
Smaller run size
Higher raw materials transport costs due to greater distance from supplier
Weak raw material buying power due to small batch size (extremely small by international standards)
Higher wages costs compared to Asian manufacturers – both:
Higher hourly rate and
Higher man-hours per kg produced (due to less automation)
Higher compliance costs compared to Asian manufacturers
Stringent Work Safe regulations
Environmental
Immigrants may be more familiar with internationally recognized brand names
Inability to source or source at viable cost Some materials – tied up to large multinational manufacturers
Small economy
Significant household and business debt
Shortage of skilled labour
Lack of scale limits ability to compete effectively with large players. It also reduces the bargaining power of
STRENGTHS
Local manufacturers have:
Better understanding of market conditions e.g. weather variations / seasonal changes.
Better understanding of issues being treated e.g. local weed types to be controlled and chemicals to specifically target them.
Ability to supply short shelf life products e.g. suspensions where imported products may expire before arrival.
Local staff working for New Zealand owned companies who may be more committed / loyal to the company. Local staff should have better understanding of market conditions and form better relationships with customers.
Faster turn-around of raw materials into finished product resulting in:
Fresher product.
Reduced quantities to be warehoused.
Ability to provide urgent customer requests
Set up for smaller batch quantities resulting in:
Quick turn-around of production.
Reduced batch set up costs.
Superior quality compared to Asian manufacturers
Lower costs compared to European manufacturers
Proximity to Emerging Asia and Australia
Big agricultural sector
High political stability
WEAKNESSES
Local manufacturers have higher cost structure due to:
Smaller run size
Higher raw materials transport costs due to greater distance from supplier
Weak raw material buying power due to small batch size (extremely small by international standards)
Higher wages costs compared to Asian manufacturers – both:
Higher hourly rate and
Higher man-hours per kg produced (due to less automation)
Higher compliance costs compared to Asian manufacturers
Stringent Work Safe regulations
Environmental
Immigrants may be more familiar with internationally recognized brand names
Inability to source or source at viable cost Some materials – tied up to large multinational manufacturers
Small economy
Significant household and business debt
Shortage of skilled labour
Lack of scale limits ability to compete effectively with large players. It also reduces the bargaining power of