Bay of Plenty Business News March/April 2019

Bay of plenty
MARCH/APRIL 2019 VOLUME 4: ISSUE 3 WWW.BOPBUSINESSNEWS.CO.NZ FACEBOOK.COM/BOPBUSINESSNEWS
The Enterprise Angels Team: Courtney Dick, Julian
So, Lara Greenaway, Bill Murphy, Kristen Joiner,
Nina Le Lievre and Kelly Taylor. Photo/Supplied.
ENTERPRISE ANGELS
RAISING THIRD FUND
Enterprise Angels has announced plans
for its third investment fund, EA3. The new
fund will initially target $2 million, but there
is provision to potentially issue up to $6
million if the demand is there.
By DAVID PORTER
Executive director Bill
Murphy says the key
difference in going to
market this time is the investor
group’s greatly increased
knowledge base on the early
stage investing market for
New Zealand companies.
Since launching in 2008,
EA has facilitated the investment
of almost $40 million
in nearly 80 early stage and
established businesses across
a variety of industries and
launched two earlier funds,
which are now fully invested,
Continued on page 3
KIWIFRUIT
Strong harvest
underway
P6
ZESPRI
Market update from
Shanghai
P8
BUSINESS LEADERS
Call for more
localism
P17
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2 BAY OF PLENTY BUSINESS NEWS March/April 2019
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BAY OF PLENTY BUSINESS NEWS March/April 2019
3
Enterprise Angels raising third fund
From page 1
aside from follow-on commitments
to existing investees.
Early stage angel investing
is generally accepted as being
a high risk proposition: investing
through a fund structure
that holds 20 or so companies
helps to spread that risk, says
EA.
“The really big difference
from our earlier funds is that
we now have much more data
about the actual and potential
risks and returns for a New
Zealand early stage company,”
said Murphy.
“In the early days we were
very much reliant on US statistics,
but now we’re really
starting to get a sense of what
the journey looks like in New
Zealand.”
Murphy noted that much of
the early stage investing data
available for US and European
early stage companies reflected
the fact that these companies
were usually already in
their target markets.
“But almost every company
we invest in, is invariably
not in its market and either
has to go offshore physically,
or its market focus has to be
offshore,” he said.
“Initially we didn’t know
how much risk and how much
cost were involved in that process.
We have been finding
out what the costs and risks
are of building that bridge
from New Zealand into markets
where we don’t have the
external capital relationships
that a lot of the US startups
already have. That’s an area of
real interest to New Zealand
investors and we’re starting
to have a much better understanding
of going that route.”
Mitigating risk
EA GP Limited chairman Neil
Craig remarks in the EA3
Fund offering memorandum
that investing in early stage
companies is high risk and
potentially high reward.
“A key way of mitigating
risk is to invest in companies
that have been through
a rigorous due diligence and
negotiation process backed by
experienced early stage company
investors,” he says.
“The other major way to
mitigate risk is to invest in a
portfolio of early stage companies.”
Craig cites the 2016
Wiltbank Study, one of the
largest studies on angel investment
in North America, which
showed the overall cash-oncash
multiple was estimated
at 2.5x capital and the holding
period was approximately 4.5
years with a gross IRR of 22
percent.
An earlier study indicated
that if an investor invested in
six investments, they had a 50
percent chance of return of
capital (1x). With 12 investments
this increased to 75 percent
probability of 2.6x return
and with 48 investments there
was a 95 percent probability
of a 2.6x return.
To date the EA Portfolio
has had 18 exits out of 71
companies - eight failures
and 10 positive exits. And
these include companies such
as Engender, which provid-
The really big
difference from our
earlier funds is that
we now have much
more data about the
actual and potential
risks and returns for
a New Zealand early
stage company.”
- Bill Murphy
ed a 5.2 times return over
five years to Enterprise Angel
investors, and SwipedOn,
which provided a 2.4 times
return over a 12 month period
(see accompanying story).
The EA3 Fund memorandum
notes that the formal
angel industry and its statistics
only began in 2006. A key
message from the data and
the experience of investors in
New Zealand and overseas is
that successful angel investors
needed to build a portfolio of
quality early stage company
investments – a minimum of
10, says EA.
EA3 is targeting a diversified
portfolio of indicatively
20-plus companies.
“Given that the typical
angel investor in New Zealand
invests between $10,000 and
$50,000 in each startup, the
only way to invest in so many
companies for all but the most
active and wealthy angel
investors, is to invest via a
fund,” the memorandum says.
“The primary purpose of
the EA Funds is to enable
investors to achieve this goal.”
Murphy said the EA was
now in a position to invest in
startups based on real information
from the experience
of New Zealand startups. He
acknowledged that this would
not make early stage investing
risk-free.
“However, interestingly
the statistics that we’re
starting to see are that in the
US angels will lose all their
money on seven out of 10 of
their investments, but of those
three where they make their
Enterprise Angels Investments to date by Sector
AGTECH 40%
TECHNOLOGY HARDWARE & EQUIPMENT 26%
SOFTWARE & SERVICES 26%
FOOD & BEVERAGE 7%
MEDICAL - HUMAN 1%
money, one of those will be a
20 x or 30 x return,” he said.
“We are not seeing the
same failure rate with NZ
startups - but we are also not
generally seeing those same
big returns.”
Maturing sector
Longtime EA board member
and investor Beppe Holm said
the latest fund reflected the
ongoing maturing of the angel
investment space and EA in
particular.
“With Funds 1 and 2 largely
committed, this is really
the next step for both existing
and new members. Enterprise
Angels now has more members
coming on all the time.”
The investment group,
which takes in both the Bay
of Plenty and more recently
Waikato, added around 60
high net worth individuals
over the past year and now
has around 210 members.
Continued on page 5
Source: Enterprise Angels
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4 BAY OF PLENTY BUSINESS NEWS March/April 2019
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From the editor
This month’s cover
story looks at the latest
developments with
Enterprise Angels. The early
stage investment group is
New Zealand’s biggest in
terms of membership and
has played an influential
role in helping inniovative
new companies get off the
ground.
EA has now announced
plans for its third investment
fund, EA3. The new fund
will initially target $2 million,
but there is provision to
potentially issue up to $6 million
if the demand is there.
Since launching in 2008, EA
has facilitated the investment
of almost $40 million in nearly
80 early stage and established
businesses across a variety of
industries and launched two
earlier funds, which are now
fully invested, aside from follow-on
commitments to existing
investees.
Early stage angel investing
is generally accepted as being
a high risk proposition: investing
through a fund structure
that holds 20 or so companies
helps to spread that risk,
says EA.
Executive director Bill
Murphy says the key difference
in going to market this
time is the investor group’s
greatly increased knowledge
base on the early stage investing
market for New Zealand
companies.We now have much
more data about the actual and
potential risks and returns for a
New Zealand early stage company,
he says.
Our writer Richard Rennie
reports from Shanghai that
China’s appetite for kiwifruit
appears to be continuing unabated.
Kiwifruit margeting
entity Zespri is anticipating
sales of almost 30 million trays
of fruit this season to mainland
China, with 20 million of those
being SunGold.
That total includes about
eight percent sourced from
Italian-based kiwifruit growers
contracted to supply Zespri
over the New Zealand low
supply period. That enables the
marketer to maintain valuable
12-month shelf space in the
competitive fresh fruit market.
Ivan Kinsella, Zespri
China’s corporate affairs manager
in Shanghai says that the
amount will mean China now
accounts for 15 percent of the
company’s sales.
We also note the changing
situations of two well-known
members of the Bay business
community. Tauranga lawyer
Bill Holland will transition in
April to a new role at major
David Porter
Bay law firm Holland Beckett
Law (HOBEC). He retired as
a partner effective the new
financial year, but will continue
working at the firm as
a consultant. “I’m not going
anywhere,” he told Bay of
Plenty Business News. “I continue
to really enjoy what I’m
doing and I won’t be changing
my law practice as such.”
Meanwhile, Tauranga
Chamber of Commerce chief
executive Stan Gregec has
decided to step down after
nearly four years in the role.
Gregec says the chamber board
is well down the track in finalizing
a new direction, which
will allow it to be much more
responsive to its members. “I
felt there was a window for
a transition to take place,” he
said.
Gregec hasn’t yet decided
what he will do next, but is
expecting to stay in the region.
He has been a strong supporter
of Bay of Plenty Business
News since we launched two
years ago, and we wish him
well.
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BAY OF PLENTY BUSINESS NEWS March/April 2019
5
Gregec steps down from
role at Tauranga Chamber
Tauranga Chamber of Commerce chief
executive Stan Gregec has decided to step
down after nearly four years in the role.
By DAVID PORTER
the board well
down the track in
“With
finalising a new
direction for the chamber, which
will allow it to be much more
responsive to its members, I
felt there was a window for a
transition to take place,” he said.
Gregec said he totally agreed
with the idea of a member-centric
chamber.
“For too long, the chamber
has been involved in too
many things that have taken it
away from a core focus on its
members. It has chased new
revenue streams at the expense
of members.
“The chamber needs to be
continually refreshing itself
with new ideas, new people
and new energy, and this is
an example that needs to start
from the top.”
Gregec said there was a
view that membership organizations
like the chamber have
had their day, but he did not
believe that to be the case.
“There are many examples
of membership organisations
that are still thriving. But they
do require an absolute and
complete focus on delivering
membership value.”
In Tauranga, the situation
was complicated by the large
number of other business
groups and networks that had
sprung up over the years. Plus
there were four Mainstreets,
all funded from a compulsory
levy, not to mention a privatised
economic development agency,
which uniquely also had a
membership.
“This makes it harder for
the chamber to operate as an
umbrella for everyone and to
speak as the collective business
voice. Therefore it needs
to refocus on its 750-plus members,
which still makes it the
largest single business organisation
by far in the region.”
Gregec - who has been a
strong supporter of Bay of
Plenty Business News since its
inception just over two years
ago - will finish up at Easter.
“I do intend to stick around
in Tauranga for now and may
look to go back into the private
sector, where I still have good
connections.”
Enterprise Angels raising third fund
From page 3
“A bigger fund means in
essence that it can invest in
and provide better opportunities
for the investors who may
be in there with a relatively
small amount of money, but
can spread that money over a
larger number of companies.”
Holm echoed Murphy’s
view that EA now had a much
more realistic understanding
of what might be achievable.
“And while we all hope
that one of our investees might
turn into the magical unicorn
and deliver phenomenal multiples
on what you put in, I
think history so far has proven
we are getting slightly less
grand returns - but nonetheless
good returns,” she said.
“Early stage is still a risky
space. The beauty of the fund
is that you can play in this
space without investing a
large sum of money in any
one investment. You have the
opportunity of have the opportunity
of your investment
being spread across many
more investments than if it
was invested in those companies
independently.”
Key sectors of interest
The Fund will focus on the
following investment sectors,
namely high growth
potential companies innovating
in: Agtech, Technology,
Hardware & Equipment ,
I think it really helped
our capital raise pitch
that we had local EA
investors who had
been in for eight years
and had reinvested.”
- Jennifer Boggiss
Software & Services, Food
& Beverage, and Medical-
Human.
Enterprise Angels and its
funds have played a key role
in developing innovation and
business in the Bay of Plenty.
Jennifer Boggiss, co-founder
and chief executive of Te
Puna-based Heilala Vanila,
which has recently raised
ANGEL INVESTMENT IN
NEW ZEALAND
New Zealand has undergone significant growth in
private equity investing in the past decade. Significant
progress has been made in building Angel market
infrastructure and capability over the past 12 years,
with many companies that received investor backing
achieving commercial success.
And the pipeline of future Angel investment
opportunities continues to be strong with a healthy early
stage investment sector in New Zealand led by the
Angel investment community.
In New Zealand, Angel investment in companies
is typically between $250,000 and $1,000,000.
Investment amounts for individual Angel investors will
typically be in the range of $10,000 to $50,000 per
investment.
Source: Enterprise Angels
capital to acquire access to
more land in Tonga as part
of its longer-term strategy of
building an integrated vanilla
supply company, said that EA
support had been key.
Boggiss said having local
EA support and long term
investors in Heilala Vanila had
really resonated with a new
lead investor who has come
into the company.
“A lot of the EA investors
have experience in horticulture,
so they understand the
importance and the value of
having an integrated supply
chain business model,” she
said.
“I think it really helped our
capital raise pitch that we had
local EA investors who had
been in for eight years and had
reinvested.”
Swiped on success
Tauranga-based software-asa-service
company SwipedOn
closed a successful cap raise
SwipedOn’s Hadleigh Ford:
Great return for investors.
Photo/Supplied.
of $1 million in January 2018,
with EA investors taking a
significant stake.
The start up’s innovative
worksite visitor management
solution was acquired by
UK AIM-listed SmartSpace
Software Plc less than year
later for $11 million in cash
and SmartSpace shares.
Co-founder Hadleigh Ford
described the deal as a great
success story for Tauranga and
the New Zealand tech sector.
“I see this acquisition as an
extremely positive thing for
the Bay of Plenty, especially
the burgeoning tech scene
here,” said Ford.
“We were really proud to
have the support of the local
angel network. We managed to
realize a return for our investors
that was extremely good.”
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6 BAY OF PLENTY BUSINESS NEWS March/April 2019
First off: Gisborne leads off this
year’s kiwifruit harvest season.
Photo/Supplied
The Gold - and Green - Kiwi rush is on
This year’s kiwifruit harvest is officially
underway in March with an initial estimated
industry-wide 150 million trays picked and
packed in Gisborne. But potential labour
shortage issues are very much on the
industry’s radar.
By DAVID PORTER tional 7000 workers by 2027.
NZKGI chief executive
Nikki Johnson said it was not
The kiwifruit industry’s
global revenue is expected
to jump from more
than $2 billion in 2017 to $6
billion by 2030 and industry
experts have said that a critical
labour shortage could hinder
this growth. In comparison with
2017 numbers, the kiwifruit
industry will require an addi-
yet clear if there would be a
repeat of previous labour shortage
issues in the sector.
NZKGI had sought to mitigate
the risk through a programme
of outreach and promotion
to potential labour
sources over the first quarter of
2019, she said. (see accompanying
story)
“We’ve gone all out to tell
our potential workers about the
roles, pay and other important
information – and dispel some
of the myths about the work.
We’ll soon know if it’s had an
impact, when the major picking
starts, and we’ll be doing
contingency planning if we do
have an issue in a month’s
time.”
Johnson said the industry
would require around 18,000
workers through the harvest
period, with the recruitment
campaign targeting Kiwis
including student and retirees
and backpackers.
The first run of kiwifruit is
predominantly the Gold variety,
with the Green kiwifruit
harvest coming into full force
now. The last fruit is typically
picked in June.
Faster maturity
Poverty Bay led the charge this
year because the crop matured
more quickly there than the rest
of the country, said Johnson.
“During March, orchards in
the Bay of Plenty, Northland,
Counties-Manukau, Waikato,
Hawke’s Bay, the lower North
Island and Tasman will follow
suit – it’s going to be a bumper
crop.”
EastPack was among a
number of growers picking
early fruit this year and chief
executive officer Hamish
Simson said the company was
expecting the season to start
earlier than usual.
“We’ve already packed
fruit at our Edgecumbe and
Opotiki sites and expect our
other four sites to be in full
We’ve gone all out to tell our potential
workers about the roles, pay and other
important information – and dispel some
of the myths about the work.”
- Nikki Johnson
swing now.
“Labour supply is well
and truly on our radar and the
team has run a comprehensive
programme to make sure we
provide people with an awesome
experience working in
the kiwifruit industry.”
Zespri chief grower and alliances
officer Dave Courtney
said the first fruit picking
was an exciting time for the
industry.
“We always look forward
to the start of harvest,” he said.
“And this year, we’re
expecting a fantastic crop of
great-tasting fruit to provide
to Zespri consumers around
the world.”
New kiwifruit labour
co-ordinator appointed
NZKGI has appointed
Gavin Stagg as a labour
co-ordinator to implement
initiatives to ensure the
industry has the workers it
requires for the 2019 season.
Stagg has been involved
in the kiwifruit industry
since 2012, working in operations
management roles at
Mount Pack and Cool and
more recently Birchwood
Packhouse in Tauranga, with
a major focus on health and
safety.
A former NZ Army chef
and hospitality industry manager,
Stagg has also worked as
a recruitment consultant and
employment officer and brings
more than 20 years’ experience
in managing and interacting
with people from many
countries and walks-of-life.
In his new role, he is
responsible for managing seasonal
recruitment initiatives
in conjunction with growers,
contractors and packhouses to
ensure as much as possible
is done to meet the sector’s
worker requirements.
Stagg said he was looking
forward to working with the
kiwifruit industry’s partners to
help the sector thrive in a period
of rapid growth.
“NZKGI has a massive
challenge to try to ensure we
have sufficient workers to get
all the fruit off the vines – for
this season and all our future
ones. I’m excited by the initiatives
already underway and
the opportunities to build a
collaborative response to the
labour demands.”
NZKGI’s Nikki Johnson
said the appointment was a
key part of the organisation’s
labour recruitment strategy.
“With the harvest now
poised to begin, Gavin will
be working closely with the
groups we’ve been reaching
out to, to support our labour
drive, and helping us process
the many queries we’re now
getting via social media about
jobs in the industry.”
- By DAVID PORTER
I’m excited by the initiatives already
underway and the opportunities to
build a collaborative response to the
labour demands.” - Gavin Stagg
Gavin Stagg: New kiwi labour co-ordinator at Toi Ohomai’s orientation day. Photo/Supplied.

BAY OF PLENTY BUSINESS NEWS March/April 2019
7
A GOLDEN
KIWIFRUIT
OPPORTUNITY?
OUR LATEST INSIGHTS REPORT ON KIWIFRUIT
The nationwide release of 750ha of SunGold Kiwifruit licenses could present an opportunity
for existing growers and potential investors. Our 2019 report* on the Kiwifruit industry
brings together industry trends and what we think are key investment considerations.
With local knowledge, experience and connections our team of kiwifruit specialists can
help you make informed decisions, making your banking a little easier.
To find out more go to anz.co.nz/businsights
* Our report is provided for information purposes and is not financial advice.
You should get professional advice before making investment decisions.
ANZ Bank New Zealand Limited 02/19 ANZ20728_BOP
anz20728_Kiwifruit_286x256_BOP Business News f.indd 1
18/02/19 3:41 PM

8 BAY OF PLENTY BUSINESS NEWS March/April 2019
Zespri predicts sound sales
for new season in China
China’s appetite for kiwifruit appears to be continuing unabated.
Kiwifruit margeting entity Zespri is anticipating sales of almost 30
million trays of fruit this season to mainland China, with 20 million
of those being SunGold.
By RICHARD RENNIE
in Shanghai
That total includes about
eight percent sourced
from Italian-based kiwifruit
growers contracted to
supply Zespri over the New
Zealand low supply period.
That enables the marketer to
maintain valuable 12-month
shelf space in the competitive
fresh fruit market.
Ivan Kinsella, Zespri China’s
corporate affairs manager, told
Bay of Plenty Business News
during a visit to Shanghai that
the amount will mean China
now accounts for 15 percent of
the company’s sales.
With SunGold orchards
coming on stream at the rate of
an additional 700 ha per year,
much of the anticipated growth
will be coming from the higher
value SunGold variety.
Kinsella acknowledged
Zespri’s success in China
today was in part the silver lining
of yesterday’s cloud, when
it experienced issues around
importation documentation
in 2011. That had resulted in
the imprisonment of a former
employee and Zespri assuming
the entire importation role
from shipping to distributor,
becoming the “importer of
record” in 2016.
Its distribution role extended
further last year when it set
up cool-stores in three regional
port hubs to supply key
accounts.
Kinsella said a major upside
of having more integrated control
over importation had been a
significant reduction in delivery
times, shortening from a week
to as little as four hours across
the wharf in China.
Key accounts support
turnover
Zespri has four high turnover
key accounts that receive particular
priority for delivery,
fruit size and delivery dates.
Marketing programmes in stores
and in media are also being
organised jointly with Zespri.
These four key accounts
make up 20 percent of Zespri’s
mainland China business, and
Kinsella anticipates more will
join their ranks as lower tier
accounts grow in turnover.
The Chinese consumer market
is undergoing a massive
upgrading in terms of what
consumers are buying, and the
food sector is no different.
The urban supermarket
environments in Tier 1 cities
like Shanghai and Beijing are
highly sophisticated and are
typically supported by online
purchase apps that are delivering
operators increasingly rich
amounts of data on consumer
expenditure and behaviour.
Estimates are Chinese consumers
are buying up to 40
percent of all items including
food online today, significantly
ahead of most western nations,
and well up on New Zealand
which sits at under 10 percent.
In top end Shanghai supermarket
City Shop owned by
Zespri, key account company
Fruit Day sells an eight pack of
Zespri SunGold kiwifruit for
128 yuan, or NZ$3.50 a piece.
Kinsella said SunGold
was proving a favourite with
Chinese consumers who identify
with the fruit, are familiar
with it, know it is healthy for
them and enjoy the taste profile
it has.
Green tends to be popular
with urban fitness seekers who
Chinese consumers
are buying up to 40
percent of all items
including food online
today, significantly
ahead of most
Western nations,
and well up on New
Zealand, which sits at
under 10 percent.
buy it for its high vitamin C
level, health benefits and lower
price.
Zespri has recently adjusted
its branding by adopting the
Chinese characters that spell
“Zespri”, pronounced “Jiapei”
in Mandarin. This was to further
aid uptake by Chinese
customers who struggle to pronounce
Zespri, with the three
consonants all together.
“We are using it more and
more in our advertising,” said
Kinsella.
“If consumers can pronounce
it comfortably, and
experience the fruit, it’s all
part of educating them about a
quality brand and their loyalty
in the future will increase.”
He acknowledged there
was a continuing delay with
the much touted red kiwifruit,
which had enjoyed positive
taste tests in Singapore and
New Zealand last year.
“The issue is not around the
fruit’s taste but around its shelf
life, which we are still working
on to try and improve.”

BAY OF PLENTY BUSINESS NEWS March/April 2019
9
Schmidt Welcomes World Gymnastics
Power Houses to New Zealand
– Trustpower Baypark
Gymnastics New Zealand (Gymnastics NZ)
has announced they have secured hosting
rights for the 2020 Pacific Rim Gymnastics
Championships, to take place in Tauranga
17-19 April 2020.
The biennial event gathers
the best of men’s and
women’s artistic, rhythmic
and trampoline gymnastics
from the 21 eligible Pacific
Rim nations. That includes traditional
powerhouses the US,
China, Japan and Russia (with
new Oceania countries likely
to be added prior to the 2020
event).
Gymnastics NZ chief executive
Tony Compier said the
Pacific Rim Championships
was one of only three events
on its international calendar
that competed in all four
Olympic sports under one
roof. The other two events are
the Olympics and the biennial
World University Games.
“We are not taking these
hosting rights lightly and
are confident that together
with our event partners, we
will provide an international
spectacle that NZ has not yet
seen,” said Compier.
“The 2000 Championships
that we hosted was a successful
event. But now, two
decades on, the sheer heightened
calibre of international
gymnastics together with
digital advances will enable
us to really provide a gymnastics
showcase that NZ has not
seen, and the world has not
yet seen from NZ.”
Compier said the decision
to hold the event in Tauranga
and at Trustpower Baypark
had been an easy one.
“There are very few stadia
across the country that have
the spatial parameters to effectively
accommodate an event
of this magnitude,” he said.
We’re delighted to be welcoming the
Pacific Rim Gymnastics Championships to
Tauranga’s Trustpower Baypark Arena.
Nashville Live
“We have formed a
strong association with the
City, Baypark and the local
community, where the 2018
New Zealand Gymnastics
Championship were held.”
Gillian Houser, business
development manager,
BayVenues / Baypark, said
they were delighted that
Gymnastics NZ had been successful
in their bid to host the
Pacific Rim Championships.
“We view our association
as a working partnership and
know that with the continued
support and efforts of all parties
it will be a tremendous
success attracting national
and international exposure for
Gymnastics NZ and our destination,”
she said.
Tauranga Mayor Greg
Brownless said it was an honour
that the city had been
selected to host the international
spectacle.
“We’re delighted to be
welcoming the Pacific Rim
Gymnastics Championships
to Tauranga’s Trustpower
Baypark Arena. We are committed
to hosting world class
events and this will be an
incredible opportunity for
people to experience international
athletes competing at
the highest level.”
As has been the trend seen
in other Olympic years, the
event is expected to play a
key role in identifying the
Dylan Schmidt
leading athletes for the Tokyo
2020 Olympics. The 2016
Pacific Rim Championships
saw several subsequent Rio
Olympians take the floor,
including world gymnastics
phenomenon Simone Biles,
alongside New Zealand’s own
Olympians Dylan Schmidt
and Courtney McGregor.
Schmidt is no stranger to the
Pacific Rim Championships,
having won bronze in 2016
in the lead-up to his Olympic
debut in Rio. In 2012, he
gained recognition on the
world stage by winning gold in
the junior division. Tauranga
in 2020 will be Schmidt’s fifth
Championships.
Schmidt commented that
it was an Olympic year, so it
was still hard to say exactly
who would be there.
“But it’s generally a very
high quality field,” he said.
“It’ll be nice to have some
of the world’s best here in
my home country, and not
have to travel to a top event
for once. I’m probably most
excited for the opportunity to
have friends and family come
to watch.”
Upcoming Trustpower
Baypark events
Join leading Clinical
Nutritionist, Ben Warren, on
his inspiring nationwide tour
to start understanding the crucial
role nutrition can play in
supporting our anxiety and
mood.
Attend “Be Pure” on 4
April at Trustpower Baypark
Stadium lounge.
For the first time, Nashville
Live is coming to New
Zealand. Nashville Live will
feature four of the top country
music acts stepping up
to perform alongside the live
house band Complete with a
Grand Old Opry announcer to
reveal the hidden histories of
country music, audiences can
sing and dance to a mixture of
classic solos, stellar duets and
fantasy group harmonies. At
Trustpower Baypark Arena, 5
April.
The NZ Tattoo and Art
Extravaganza returns 13 &
14 April. Prepare yourself
for the best international and
local tattoo artists festival,
indoor and outdoor zones,
live entertainment, Wearable
Art Show, Creative Village,
caravan street art exhibition,
bike stunts, live bands, ‘The
Island’ - variety of food and
drinks and more. Come join
us and celebrate creativity &
celebrate life!
Celebrating 20 years of
building dreams in the Bay,
the annual Tauranga Home
Show takes place on 3-5 May.
Now spread across the entire
Arena as well as epic outdoor
displays, the Tauranga Home
Show will be bigger and more
inspirational than ever before.
Speedway continues to
attract the adrenaline junkies
to the Stadium for actionpacked
meets as the season
draws to an end. Remaining
Speedway events are the
North Island Midgets on 6
April, the Harry Fredrickston
Stock Car Gold Cup & Super
Stock Rumble 27 April.
There will be a spectacular
fireworks display following
the closing night for the season
on 4 May.
Imagine a full day, conveniently
located, a one-stopshop
for everything you need
for the most important day
of your life? Experience the
fun, the excitement and the
glamour at the Bay of Plenty’s
No.1 Wedding Show 26 May.
Featuring more than 100
exhibitors with everything
from gowns, jewellery, hair &
make-up, photographers, venues
& caterers, food trucks
and so much more.
For more information
on any events, enquiries for
Baypark venues, BayStation
activities or service on/
off site from BayCateirng,
BayAudioVisual visit www.
trustpowerbaypark.co.nz,
email events@bayvenues.
co.nz or call 07 577 8560.

10 BAY OF PLENTY BUSINESS NEWS March/April 2019
Capital Gains Tax - keep calm and carry on
The Tax Working Group (TWG) tabled its final report on the Future
of Tax sparking a media and public frenzy around capital gains tax
(CGT). With all the media commentary, you could be forgiven for
thinking the report was solely on a capital gains tax.
Of the 99 recommendations
the TWG made,
only TWO related to
capital gains tax.
Seldom reported is that the
TWG conducted a thorough
review of New Zealand’s current
tax system, and how it
could look in the future.
It highlighted areas of the
system that needed work as
well as making business and
taxpayer-friendly recommendations
that could encourage
savings and investment, support
business and ultimately
see us paying less tax.
The good news is that our
tax system is in good shape. It
works well, delivers adequate
revenue for the government’s
coffers and has relatively low
compliance and collection
costs.
Further it doesn’t distort
economic behaviour a whole
lot, except for certain areas of
property.
So, it’s doing all the things
a good tax system should
and not many of the things it
shouldn’t.
Given the introduction of a
CGT is not a given, let’s look
at some of TWG’s non-CGT
recommendations.
Scope for changes
Business taxation – Changes
to loss continuity rules to support
innovative start-up firms.
Allowing tax deductions for
certain expenditure (blackhole)
where there is currently
no entitlement to claim,
including seismic strengthening
costs.
Compliance saving measures
such as increasing the
provisional tax threshold from
$2500 to $5000, increasing
automatic deduction for legal
fees and extending this to
other expenditure types.
Allowing depreciation on
commercial, industrial and
multi-unit residential buildings
(if a CGT was introduced).
Retirement savings – No significant
changes to the taxation
of savings, but modest
tax changes recommended via
Kiwisaver to encourage saving
and investment for low
and middle income earners.
Measures include: increasing
member tax credit, lowering
PIE rates for lower
income bands, and refunding
Employer Superannuation
Contribution Tax for low
income earners.
Future of work – With the
increasing trend of gig economies
and transient workers
contracting their services on
a short-term basis, PAYE taxtake
predicted to decrease in
future, which could impact
government tax revenue significantly.
The review suggested the
use of withholding taxes and
robust reporting to mitigate.
Environmental taxes – The
tax system could play a role
in sustaining and enhancing
NZ’s natural capital.
TWG discusses what this
could look like in the short,
medium and long term.
And it recommends government
strengthen its tax
capabilities in this area and
look at implementing environmentally
friendly concessions
while reviewing current
tax concessions if they are
harmful to natural capital.
Administration of tax system
– The review suggests:
better use of data to help
inform future policy development
and respond to public
needs, establishing taxpayer
advocacy services to help
with resolution of tax disputes
with IRD, and to consider
simplifying the disputes
process for smaller taxpayers.
Taxation of charities – The
WTG supports IRD’s current
review of tax treatment of
charities.
It recommends considering
taxing profit accumulations
until they are applied to
charitable purposes.
Also, examining whether
there needs to be a distinction
between privately controlled
foundations and other charitable
entities and whether
greater governance required.
Leave as is
No GST changes or exemption
– Submissions were
received calling for the reduction/removal
of GST from
food, medical supplies etc.
While good in their intent,
exempting GST on certain
goods is inefficient from a
policy perspective as there
are more efficient, targeted
ways of addressing this than
using the tax system.
No change to top 33 percent
personal tax rate – Though
this is relatively low by international
comparisons, the
$70,000 kick-in threshold is
low.
No company tax rate reduction
– While our company
tax rate is now slightly higher
than the OECD average, at 28
percent it is still lower than
Australia’s.
The WTG says there is
no clear evidence that it is
discouraging overseas investment.
If Australia was to lower
its rate, then NZ should look
at doing so also.
No adjustment of tax system
for inflation – With inflation,
our wages/salaries increase
and we end up with more of
our income being taxed in a
higher tax bracket. Here we
have a clear case in principle
for adjusting the tax rates.
But practically it is very
hard to do given there are
hundreds of thresholds in the
tax rules.
The review suggests government
should keep an eye
on and look at the current
thresholds from time-to-time.
No wealth or land taxes –
There were lots of submissions
supporting these taxes
on equality / wealth distribution
grounds.
But none were found
acceptable based on fairness,
as many would not have the
cashflow to afford an annual
tax.
No GST on financial services
– International experience
is that it’s very hard to
tax properly and the WTG
was concerned the cost
would be passed onto the end
consumer.
Capital Gains Tax
A lot has already been said
in the media about CGT and
conjecture is rife. What is a
fact is that if the government
REGULATORY MATTERS
> BY GRANT NEAGLE
Grant Neagle, a director at Ingham Mora Chartered Accountants
in Tauranga, is a business advisor and tax specialist. He can be
contacted on 07- 927- 1225 or grant@inghammora.co.nz
proceeds with its CGT journey,
the road ahead is not a
long one.
It’s incredibly short and
fraught with political risk and
danger at every turn.
NZ First holds the political
key. The government will
need its coalition party’s support
every step of the journey.
That will run from the
government’s planned
announcement in April as to
what TWG recommendations
it will pick up and run with,
through the tax policy process,
to the introduction of
any legislation to Parliament
by October/November.
Then there is the Select
Committee stage before any
Bill’s third reading and enactment
on July 2020. NZ First
could reconsider its position
at any point along the way.
The timeframe is incredibly
tight - and some would
say unachievable - to achieve
a comprehensive CGT including
the amendments required
of the current legislation as
it applies to the taxation of
capital.
Australia took five years
to design its CGT system,
two-to-three years to legislate
it and approximately 10 years
fixing it up. Even now it is
not perfect.
The government has 15
months if it is to meet its
timeframe of passing it into
law by July next year.
A wise person would not
panic yet as nothing may
eventuate. And if the government
chooses to take a CGT
further, it will be a different
beast to what is suggested by
the TWG, given it will almost
inevitably have been made
more politically palatable.
So keep a close eye on
the coverage and debate, but
wait until the government’s
announcement in April before
taking stock and assessing its
impact.
The comments in this article
are of a general nature
and should not be relied on
for specific cases, where
readers should seek professional
advice.
Conference to celebrate
women forging their own path
The Business Women’s Network -
an arm of the Tauranga Chamber
of Commerce - is hosting its
biennial Craigs Investment Partners
and Cooney Lees Morgan Regional
Business Women’s Conference on
17-18 May at Trinity Wharf, Tauranga.
This year’s theme, “Forging your
own path”, was based on the idea that
success took a different form for everyone,
said the organisers. Conference
speakers had been chosen as trail-blazing
individuals who had broken the
mould, challenged the status quo and
taken risks in order to achieve career
success..
The programme starts with a dinner
on Friday evening, followed by a full
day of speakers on the Saturday.
Speakers include:
• Lisa King, 2019 New Zealander of
the year finalist, social entrepreneur
and founder of Eat my Lunch.
• Dr Farah Palmer, lecturer and former
Black Ferns captain.
• Sandra Clair, founder of Artemis,
health scientist and traditional plant
medicine expert.
• Tonia Cawood, chair of Chiefs
Rugby Board, independent chartered
director and advisor.
• Teresa Hodges, founder of Blak,
• Rebecca Anderson, founder of
Chaos & Harmony.
The conference has been held biennially
since 2002 and has gained a
must-attend reputation for women
in business in the Bay of Plenty.
Organisers said some past attendees
had found it had been a life-changing
experience, and had garnered strength
from speakers and delegates to take a
significant career step.
This year’s conference is anticipated
to again be a sell-out, with around 190
women expected to attend. Attendees
will come from all ages and stages in
business, from senior businesswomen,
through to those thinking of making
the first step into business. Organisers
said based on previous experience, the
attendees would be a cross section of
women with an interest in business.
The organisers said they envisaged
the speakers’ diverse experiences
would inspire attendees and give them
courage to explore opportunities outside
their comfort zone and challenge
some of the boundaries they perceive
for themselves.
For further conference information
see bwn.org.nz/conference/

hello@globox.nz

12 BAY OF PLENTY BUSINESS NEWS March/April 2019
High global debt dampening
economic rebound
Economic growth and political concerns remain elevated, despite
asset prices recovering over the quarter ended 28 February 2019.
A
reversal of Central Bank
policies away from
increasing interest rates
towards more accommodative
policies helped asset prices
stabilise. In China, policy
stimulus has begun to positively
impact credit growth,
addressing fears of an economic
slowdown.
Further progress on solving
global trade disagreements is
still required for global economic
growth to rebound.
However, even if this
occurs, the high level of global
debt is likely to prevent
economic growth rebounding
strongly.
Housing market weakness,
now emerging in more developed
economies is expected
to be a further drag on global
economic growth.
Markets reset
In response to Central Bank
policy decisions, positive equity
market returns in the first
two months of 2019 offset the
negative end to 2018.
Financial conditions are
expected to be supportive
of markets for the foreseeable
future, however risks to
earnings growth are becoming
more elevated.
In the recent New Zealand
company reporting season,
downgrades to FY19 forecast
earnings outpaced advances
by 2:1.
In Australia, the weaker
housing market is likely to
see a similar result from companies
there, with the trend
of upping dividend payments
and share buybacks at the
expense of investment, likely
to provide a further challenge
to achieving earnings growth
forecasts.
Given the cyclical challenges
(both regionally and in
the global economy), investors
now favour defensive sectors
and asset classes.
This should reduce return
expectations. We expect low
inflationary pressures to provide
sufficient comfort to
Central Banks to keep interest
rates low. This ongoing stimulus
should reduce risks of a
collapse in economic growth.
However companies will
need to deliver earnings growth
if markets are to strengthen
further.
We note that earnings
growth is becoming harder to
find, although opportunities
still exist for selective investment
within the various global
markets.
Income/structural growth
over cyclicals
Any financial market weakness
in 2019 is expected to
arise from economic rather
than just financial market reasons
and we don’t expect any
major credit event to disrupt
markets.
Labour markets should
remain relatively firm, which
will ensure consumption ticks
over, albeit this may increasingly
pressure costs.
Domestically, weaker
growth in house prices and
tightening credit conditions (as
financial institutions are forced
to hold more capital against
loans) are also likely to impact
investor sentiment.
Accordingly, despite cyclical
growth investments (such
as the retail sector) increasing
in attractiveness from a
valuation perspective, defensive
income-generating invest-
ments (such as the listed property
sector) and companies
with the ability to grow earnings
regardless of economic
conditions (such as the healthcare
sector), remain preferred.
WHAT TO DO WITH YOUR MONEY
> BY BRETT BELL-BOOTH
Investment Adviser with Forsyth Barr Limited in Tauranga, and an
Authorised Financial Adviser. Phone (07) 577 5725 or
email brett.bell-booth@forsythbarr.co.nz.
This column is general in
nature and is not personalised
investment advice. This
column has been prepared
in good faith based on information
obtained from sources
believed to be reliable
and accurate. Disclosure
Statements for Forsyth Barr
Authorised Financial Advisers
are available on request and
free of charge.
The flight to small industrial
We are seeing unprecedented
prices being
paid for smaller industrial
and commercial properties
in the Bay of Plenty at the
moment, especially in my own
forte of industrial at Tauriko
and Mount Maunganui.
It’s not difficult to understand
why. We are seeing the
impact of the flight of investors
out of the residential sector
and into smaller commercial
and industrial units where
they can enjoy more attractive
yields.
The trend has also included
investors strategically landbanking
by securing strategic
sites. And there is a shortage of
quality industrial stock, which
is putting upward pressure on
pricing.
Without a doubt, smaller
residential investors are reacting
to recent regulatory changes
and government policymaking,
which have made it much
less attractive for them to be in
the rental residential market.
Yes, there is a potential capital
gain for residential investors
over the longer term. But
in today’s market, they may
only be getting a three to four
percent annual yield on residential.
And out of those returns,
the residential landlord is paying
for all the costs, maintenance
and other outgoings.
By contrast, in industrial/
commercial, the tenant typically
pays for the outgoings, and
the landlord may be looking
at typical yields of five to six
percent.
And that is excluding any
potential capital gain.
So we are seeing good
numbers of investors both
contemplating and actioning
on selling their properties to
reinvest in industrial or commercial
properties.
We are seeing strong
inquiries for smaller industrial
properties and units, especially
in Mount Maunganui and
Tauriko.
In my five years or so specialising
in this sector, I’ve
found it can be subject to quite
dramatic changes.
For example, we may see
a new development come on
stream with 14 or 15 brand
new units, which might saturate
the market for a while.
But currently, there is only
limited availability in the market.
I’ve been heavily involved
in working with developers
in properties ranging from 50
REAL ESTATE
> BY PHILIP HUNT
Philip Hunt is the Managing Director and Principal of
Ray White Commercial Tauranga. He can be reached at
philip.hunt@raywhite.com.
sqm to 300 sqm and I try to
recommend to my developers
where the demand is at any one
time and where and how it is
likely to develop.
This part of the sector is
definitely emerging as an
attractive investment for residential
investors wanting to
dip their toe in industrial.
Basically, if you have a
choice between investing
$600,000 in a residential and
getting three or four percent,
or in a small industrial and
getting five or six percent,
its won’t be surprising if this
trend is maintained over the
next year or so.
This trend may see more
housing freeing up for firsttime
home buyers.
But there are certainly some
concerns about the longer-term
impact of this on the residential
rental market.

BAY OF PLENTY BUSINESS NEWS March/April 2019
13
To license or to franchise?
FRANCHISING
> BY NATHAN BONNEY
Nathan Bonney is a director of Iridium Partners. He can be
reached at nathan@iridium.net.nz or 0275-393-022
It’s a common journey for
many New Zealand franchised
businesses - the
founder develops a successful
single unit business, grows
organically to multiple outlets
and then looks externally to
expand further.
Franchising is an attractive
vehicle, providing the ability
to expand utilising the capital
and efforts of others (franchisees).
However, when founders
start to explore the possibility
Generally speaking,
licences are added
to the activities
of established
businesses, while
franchising is often
associated with new
or start-up businesses,
therefore making it
a better platform for
growth.
of franchising, they may come
across the concept of licensing,
and inevitably questions are
asked - what’s the difference,
what’s better for my business,
what’s going to be more attractive
for potential investors,
franchisees or licensees?
Licensing covers just one
element of the business – the
use or access to the Intellectual
Property of another while
ownership of the IP is retained
by the original owner.
Franchising encompasses
the entire way of doing business,
usually reproducing a
proven or successful business
concept extending to marketing
and brand development.
Franchising is also based on
documentation and processes.
What’s best for the
founder?
The very nature of franchising,which
is intended to reproduce
a successful business,
makes it more suited to growth
than licensing.
Licensing lacks the business
processes required to
establish a business.
Without the necessary documentation
of business processes,
it is very difficult for
new entrants.
Generally speaking, licences
are added to the activities of
established businesses, while
franchising is often associated
with new or start-up businesses,
therefore making it a better
platform for growth.
Maintaining control is a
major consideration for founders.
Licences may be acquired
by an established business,
in effect self-selecting, while
franchises are appointed or
selected against established
criteria designed to ensure performance.
Founders have greater control
over who acquires or distributes,
effectively fronting
their brand.
A further-reaching aspect
is overall business conduct
control.
Franchising is able to
include negotiations on pricing
(subject to the cartels act) how
the business is run, maintenance
of service consistency
and all the things that build and
support a brand.
The best option for an
investor and operator
While someone looking to add
a product or service to their
existing business may look
towards a licensed product
or brand, licensing is a poor
option for someone looking to
enter and own their own business,
but not by themselves.
Franchising provides an
entire business system including
initial training, ongoing
support and guidance, marketing
and branding.
Good franchise systems
will continuously innovate
and add improvements to their
systems, including those made
by franchisees, licensed situations
have little incentive to
innovate and certainly none
to share.
Investors need to consider
both defending their capital
position and the ability to
grow it.
Franchise agreements will
usually provide a defendable
territory in which to operate
(often exclusively) and a fixed
term, whereas licenses are not
usually exclusive.
Critically a franchise agreement
provides a mechanism to
build (and sell) the goodwill
component of the business,
which in most cases a licence
does not.
While more expensive and
time-consuming initially, in
my opinion franchising is the
superior format for developing
an overall business or system
for expansion.
For investors and/or operators,
franchising provides more
tools in the box and a much
stronger and more defendable
business format compared
with a licensed arrangement.
Ray White Commercial Tauranga
INVESTMENT OPPORTUNITIES
Keahi Court, Tauriko Business Estate
Portside Industrial Park – 72 Portside Drive, Mount Maunganui
ONLY 3 LEFT
Artist impression
Artist impression
• Modern Industrial Units
• In Tauranga’s thriving Tauriko Business Estate
• A chance to ‘own your own’ in NZ’s largest
industrial estate
• Prices ranging from $675,000 to $1,195,000
• Completion anticipated late 2019
• Magnificent Industrial development under way
• 20 Units sized from 86m² to 150m²
• Freehold land (Unit Titles apply)
• High quality build with medium stud height of
6.2m (approx)
* Completion estimated November 2019
Call the Sole Agent now
Artist impression
Philip Hunt 021 378 348 philip.hunt@raywhite.com Ray White Commercial Tauranga - BOP Commercial Realty Limited MREINZ (REAA 2008)

14 BAY OF PLENTY BUSINESS NEWS March/April 2019
Tauranga Home
Show turns 20
Exhibition
Flooring
Design&Build
Lighting / AV Solution
Signage
The Tauranga Home Show proudly launches its 20th anniversary
show in 2019. From humble beginnings, this iconic exhibition has
evolved over two decades into the huge exhibition we see today.
Bay Events was established
in 1995 by
Raewyn and Graeme
Martin, and has since put on
over 60 trade events.
This includes the current
‘big three’, the Tauranga Home
Show, the Seriously Good
Food Show and the Spring
Home Show, as well as previous
events such as the Grow
Expo, the original Tauranga
Boat Show, and a handful of
one-off expos.
In the beginning, the focus
was on making shows successful
for exhibitors.
“We quickly realised that
we had to focus on visitors just
as much as exhibitors,” says
Graeme.
“We strive to create an
atmosphere where visitors are
happy to stay and enjoy the
atmosphere, and from there
they build relationships with
the exhibitors. Those relationships
are the main driver for
our business, and they’re why
we are here today.”
The show, its exhibitors
and its suppliers have grown
together over the years, with
some current exhibitors on
board since the first Tauranga
Home Show took place in the
Marquee & Outdoor Events
Display products
Furniture Hire
exhibitionhire.co.nz
. Commercial and Industrial Electricians . Display & Exhibition
. Lighting, Power & Data
www.ryanelectrical.net.nz
Ryan Electrical have been working with Bay
Events and the Home Shows since 1995 carrying
out all their lighting and electrical requirements.
Ryan Electrical enjoy a very good relationship
with Bay Events which has evolved over the years
of working together.
Bill and the team at Ryan Electrical would like to
congratulate Dana and the team at the Tauranga
Home Show on their 20 year anniversary!
AEGIS Private Security are proud to be supporting
Bay Events and the Home Show.
Phone: 09 570 8955
Mobile: Bill 0274 962 566
Mobile: Ian 0274 795 066
PO BOX 51895, PAKURANGA,
AUCKLAND 2140
ryanelectrical@xtra.co.nz
To secure & protect phone Heather Jones
07 576 3055 or 021 323 535
heather@aegisprivatesecurity.co.nz

BAY OF PLENTY BUSINESS NEWS March/April 2019
15
Mount Action Centre in 2000.
When Raewyn and Graeme
discovered a group of dusty
storage sheds at Baypark, they
saw the potential for larger
shows in what they later named
the Pavilions, and moved their
shows across town.
Bay Events was pleased
to be involved in helping to
evolve the Baypark site from a
speedway venue to a community
hub, including the Arena’s
sport and exhibition centre.
“Baypark is incredibly valuable
and meant a real step up
for us,” says Graeme.
“It started out as 14 hectares
of swampland, but with the
facilities here the city has grown
around it. As a single-level
venue with huge carparks and
multiple loading zones, it’s one
of the most workable event venues
in the country.”
Raewyn and Graeme’s
daughter Dana joined Bay
Events in 2011 ready to drive
the business further into the
future, and recently their son
Richard has also joined the
team, creating a truly family
business that is local and
immersed in the community
wqww
they work in.
Even in today’s digital age,
exhibition-style marketing is
strong and growing. “Face
to face marketing and dealing
with real people is still key, it
has become even more relevant,”
says Dana.
“People are happy to buy
online, but when you’re making
big money decisions for
your home, you want to look
your supplier in the eye.
“At a home show, a supplier
puts themselves directly in
front of their customers, and as
the organisers we aim to make
that process an enjoyable one
for everybody involved.”
Despite its growth and success,
Bay Events still have the
same ethics and goals that they
did on day one.
“We succeed when our
exhibitors succeed, and not
before,” says Dana.
“By recognising that
and striving towards it in
everything that we do, we have
created an incredible show that
is now celebrating 20 years of
helping the community build
their dreams here in the Bay
of Plenty.”
NOW EVEN BIGGER - SPREAD ACROSS TWO HALLS!
SPECIAL GUEST
JO SEAGAR
3rd, 4th & 5th
MAY 2019
DON’T MISS OUR
LOUNGE EXPO
TRUSTPOWER ARENA BAYPARK
10am-5pm daily | Adults $10 | Children 13 & under free | taurangahomeshow.co.nz

16 BAY OF PLENTY BUSINESS NEWS March/April 2019
More localism needed for
effective development
The audience of leading business people at
this year’s Business Leaders’ Lunch heard
Tauranga MP Simon Bridges and Mayor
Greg Brownless share major concerns
over how government was holding back on
needed infrastructure funding.
By DAVID PORTER
Meanwhile, the third
speaker, University of
Waikato senior deputy
vice-chancellor, professor
Alister Jones, emphasised the
positive impact that could
be expected with the new
Tauranga campus opening.
The annual lunch was
chaired by Tauranga Chamber
of Commerce chief executive
Stan Gregec, who has recently
announced he plans to step
down to explore new options
after four years in the role.
It was hardly surprising that
Bridges, addressing the leaders’
lunch for the first time in
his new role as Leader of the
Opposition, would be highly
critical of central government
pulling the plug of major local
infrastructure projects that had
been on the books under the
National government.
“In the 18 years I’ve been
in Tauranga it has become
a much more complex and
diverse city,” he said. “But
the issues are fundamentally
the same - the challenges of
growth and infrastructure and
amenity development.”
Bridges cited concerns over
the government’s decision to
freeze funding for new roading
north and to serve fast-developing
Tauriko, and what
he described as a land supply
crisis, and the NZ Transport
Agency leadership in disarray.
“The Tauranga council is
going to stop contracts on key
roading projects...until the government
gets its act together.”
The region needed to see
more bold leadership given the
issues of dealing with faceless
bureaucracies, and planning
that could stretch on for years,
Bridges added.
He went on to express
his support for the concept
of incentivising councils by
allowing them to keep the GST
for local use when they had
acted effectively to cut planning
blockages and create genuinely
new developments.
“It’s not National Party
policy - yet,” he said. But
he stressed that land supply
was critical for the region’s
development.
The growth challenge
His comment reinforced
Tauranga Mayor Greg
Brownless’ plea for more
localism and less government
in decision-making.
“A 2016 analysis of one NZ
city saw its council invest $93
million for growth infrastructure,
yet at best that council
will only recover its costs,”
he said. “The government on
the other hand will make a
$52 million net gain on GST
relating to the land sales alone.
Brownless said the number
one issue facing Tauranga
and the surrounding areas
was the growth challenge,
with 35,000 additional houses
required over the next 30 years
in Tauranga alone, and significant
population aging with
most growth expected in the
65-plus demographic.
For the council the initial
priority was to push ahead
with development at Te Tumu
(7000-8000 homes) and
Tauriko West (3000 homes).
The transport network suffered
significant constraints
and the network was already
under significant pressure in
some locations. More growth
will exacerbate this problem
without significant investment,”
said Brownless.
And growth would bring
significant financial pressures
in the form of infrastructure
investment, putting significant
- and eventually unsustainable
- pressure on the council’s
balance sheet and debt levels
Brownless said that to get
Tauranga and the subregional
share of Government funding,
TCC, Western BOP Council
and the BOP Regional Council
through the Smartgrowth
The issues are
fundamentally
the same - the
challenges of growth
and infrastructure
and amenity
development.
– Simon Bridges
Partnership and together with
NZTA, were working on an
important urban development
and transport project called
the Urban Form and Transport
Initiative (UFTI).
“This is a collaborative
approach driven by the understanding
that to create a better
future, Bay leaders must all
work together to more fully
integrate and action urban
development and transport
planning,” he said.
“There are transport projects
being held up that must
be delivered now. Much needed
land supply can only be
developed when all parts of
the puzzle line up. The missing
piece is roading and NZTA’s
share of those costs.”
But rather than thinking the
answer to every question was
more control from Wellington,
Brownless argued for more
localism. That meant a more
effective partnership between
local and central government
and a willingness to incentivise
local government to take
a greater role in shaping their
own social and economic outcomes.
And it required more effective
partnerships between
councils and their communities,
from business organisations
to groups to neighbourhoods.
“Localism involves giving
greater choice to communities
about the nature of local public
services and how they are
delivered,” he said.
“Change is necessary
because our highly centralised
institutional settings are not
working and are acting as a
drag on effective functioning
of our economy and society.
The NZ policy landscape is
riddled with one size fits all
thinking.”
More human capital
Professor Alister Jones told the
audience that the University
of Waikato’s ultimate purpose
was to create and disseminate
knowledge for the benefit of
society.
“The opening of our new
campus is the beginning of a
really exciting transformation
for Tauranga – becoming a
university city,” he said.
“Our vision is to be deeply
embedded in the social and
economic systems of the Bay
of Plenty, and to transform
Tauranga into a true university
city.”
Universities attracted people,
staff and students from
the region, the country and
around the world, all of which
benefit the local economy, he
said. This year’s numbers were
already up on this time last
year, and were projected to
grow exponentially.
“Our vision is to be up
skilling more and more people
from the region so that your
innovation system and industries
have access to a greatly
increased pool of people. We
attract valuable income and
investment to the Waikato and
Bay of Plenty, as well as talented
researchers from around
the world who want to work
with us.”
Jones said the university’s
vision was to expand the
innovation clusters currently
offered so the innovation system
in the region continued
to grow and expand. And he
cited current areas of significance
such as:
• The high performance sports
at the Adams Centre
• Coastal marine research
through our field station
• PlantTech – an industry-led
research organisation based
in the Western Bay of Plenty,
focused on technology and
innovation in premium,
plant-based value chains
Our vision is to be
deeply embedded
in the social and
economic systems
of the Bay of Plenty,
and to transform
Tauranga into a true
university city.
– Alister Jones
“Universities don’t generate
wealth – we are an enabler
and catalyst for wealth generation
for others,” he said.
The opening of the new
campus signalled new opportunities
when it came to the
role the new campus would
play in the future economic
growth of the Bay of Plenty.
“University and business
research collaborations are
an essential part of growing
a knowledge-based economy,
bringing advanced skills to,
and growing them from, the
region,” said Jones.
“We continue to engage
with the business community
to demonstrate linkages
between qualifications and
career opportunities.”
The new campus was the
most innovative example of
partnership in tertiary education
in New Zealand, he added.
“We have signalled to the
Bay that we are committed to
the region for the next 100-plus
years and beyond, ensuring a
diverse talent pool that will
serve in our future workforce.”
Localism
involves giving
greater choice to
communities about
the nature of local
public services
and how they are
delivered.
– Greg Brownless
Challenges and opportunities: Stan Gregec, Simon Bridges, Greg Brownless
and Alister Jones at the Business Leaders Lunch. Photo/David Porter.

BAY OF PLENTY BUSINESS NEWS March/April 2019
17
Bill Holland
moves to new
role at HOBEC
Well-known Tauranga lawyer Bill Holland will
transition in April to a new role at major Bay
law firm Holland Beckett Law (HOBEC).
By DAVID PORTER
Holland retired as a partner
effective the new
financial year, but will
continue working at the firm as
a consultant.
“I’m not going anywhere,”
the affable lawyer told Bay of
Plenty Business News.
Holland Beckett was originally
started by his father,
William Holland Senior, in
1937.
The son joined in 1976, and
has been a mainstay ever since.
HOBEC - as it is generally
known - has grown into one of
the region’s biggest law practices,
with some 50 lawyers and
offices in Tauranga, Rotorua,
Whakatane and Opotiki.
“It’s a big outfit now and
the firm’s going really well,”
said Holland, who has a long
history of active involvement
in both the business community
and in philanthropy.
The well-liked and respected
lawyer, who is now 66, said
the firm used to have a retirement
age of 65, but after discussion
with fellow partners a few
years ago, it was raised to 70.
But Holland said that,
given the rate of technological
change in the law sector, he
had never envisaged working
till that point.
“I’ve got these younger
partners who are much smarter
than I am,” he said.
“I’m not up with the play
in terms of new technology
and I’m happy for others to
be driving that forward. I was
thinking last year that I was
going to stand down sometime
as a partner.
“But I never intended to
retire. I continue to really
enjoy what I’m doing and I
won’t be changing my law
practice as such.”
Holland notes that some of
his clients have been with him
for 40 years and were originally
clients of his father or their
children.
“I have a wonderful relationship
with them and I
wouldn’t want to stop.”
One issue that has blindsided
Holland over the past year
was his diagnosis of bowel
cancer last August, which he
emphasises was completely
unrelated to his plans to retire
as a partner.
“It was entirely coincidental
that I’ve had this major
health incident.
“Fortunately, after two bouts
of surgery and subsequent tests,
I am currently not showing any
signs of the cancer.”
Holland specialises in
trust law and commercial and
property transactions. He was
born, raised and educated in
Tauranga.
He is deeply immersed in
the city’s business world and
has had a long involvement
with economic development
agency Priority One.
Chief executive Nigel Tutt
said Holland had played a
huge role in shaping Priority
One as an organisation.
“Bill has been a passionate
supporter of economic development
in Tauranga and in
particular has recognised the
important link between the
economy and the wider community,
especially for young
people,” said Tutt.
“We look forward to his
continued enthusiasm and support
in the future.
Community contributions
Holland acts as legal advisor to
a large number of Tauranga’s
leading business people and
has been active with a number
of community organizations.
He has received a number
of awards over the years for
his services to the community,
including being made a Member
of the New Zealand Order of
Merit (MNZM) in 2012 for services
to the community.
He recognised from an
early stage the huge potential
benefit to the community in
encouraging private philanthropy
and in 2002 he travelled
to the US to investigate the
concept of community foundations,
which have long been
utilised there as a tool in promoting
philanthropy.
Upon his return he played a
major role in establishing the
Acorn Foundation.
In 2003 he produced the
original trust documentation
on a pro bono basis, and served
as the chair for eight years.
The success of the Acorn
Foundation in Tauranga has
provided a model for other
community foundations to follow
in both New Zealand and
Australia.
Because of his personal philanthropy
and his involvement
with the Acorn Foundation,
Rotary International honoured
him with a sapphire pin to add
to the Paul Harris Fellowship
(Rotary’s highest honour) he
had already received for service
to philanthropy.
He was elected in 2012
to the Board of Trustees of
Tauranga Energy Consumer
Trust and has served as TECT’s
chair since 2014.
He also serves on a number
of national and local Charitable
Trusts, voluntary boards, and
advisory committees.
Holland has also been
actively involved in helping
bring the University of
Waikato campus to Tauranga.
Senior deputy vice-chancellor,
professor Alister Jones,
told Bay of Plenty Business
News that Holland had been
an enthusiastic supporter of
Bill Holland is retiring.
We won’t miss him at all.
That’s because Bill will continue to work with us as a consultant.
For over 40 years Bill Holland has
been one of the shining stars at
Holland Beckett Law.
As a senior partner specialising
in trust law and commercial and
property transactions, Bill has
provided legal counsel to many
of Tauranga’s leading businesses
and a long list of community
organisations.
Along the way Bill has received a
number of awards for his services
University of Waikato’s development
in Tauranga.
“His leadership was instrumental
in guiding the funding
arrangements from community
funders and he worked tirelessly
to ensure its success,”
said Jones.
“It is a pleasure working
with him and his guidance is
always valued.
“Bill understood the operating
environment of the university
and ensured that both
parties’ expectations would be
met to create a truly iconic
development for the city and
the university.”
to the community, including being
made a Member of the New Zealand
Order of Merit (MNZM) in the
Queen’s Birthday Honours List 2012.
On April 1st, Bill Holland retires as
a partner. We want to acknowledge
and thank him for the outstanding
contribution he has made to
Holland Beckett as one of our senior
partners. And we look forward to
welcoming him back the next day as
a consultant.
T 07 578 2199
Tauranga / Rotorua / Whakatane / Opotiki
hobec.co.nz
WAVE24869

18 BAY OF PLENTY BUSINESS NEWS March/April 2019
Be aware of the potential value gap
When eyeing up commercial or industrial property for sale, RV
or rateable value, will be listed on the information memorandum.
But just how much weight does this figure carry?
In the residential property
arena, much jousting goes
on between agent and prospective
buyer as to the relevance
between expected sale
price and RV.
How much higher than RV
could the sales price on that
home be? Could the sales
price be lower than RV for this
property?
The same conversations
can occur in the commercial
and industrial sectors.
However, regardless of the
sector, the RV is simply what it
states – a figure assigned to the
land and buildings for council
rating purposes.
That figure’s relevance to
the current market value or a
registered valuation is inconsistent
and, often, irrelevant.
Anecdotally, the latest release
of RVs in Auckland puts some
commercial and industrial
property around 10 percent
above market values.
Agents say this is creating a
disparity. Vendors’ price expectations
may be pegged against
a too-high RV, and inflated RVs
could put potential buyers off
pursuing a property.
Carl Waalkens and Paul
Butchers of Bayleys Valuations
distil the RV versus market
value debate down to some
key fundamentals.
Is rateable value the same as
capital value?
Essentially, yes. Both values
are the sum of the land
value and the improvement
value of a property.
Who compiles RVs?
RVs are undertaken on
a mass appraisal basis by
Quotable Value Ltd (QV) on
behalf of local councils.
How are commercial/industrial
RVs calculated and established?
The valuer analyses sales
and value trends for an area by
investigating sales data.
Once a trend is established,
parameters are applied to properties
within that area on an
indexed, mass appraisal basis.
QV aims to ensure uniformity
across a defined area,
thus maintaining alignment
of market values and rating
liability.
For properties outside the
“norm”, with special features,
higher specifications and the
like, value deviations are often
normalised.
The freehold market property
values are then independently
audited by the
Office of the Valuer General
before being published by the
local council.
RVs are assessed on a
full-occupancy basis regardless
of whether a property is
currently tenanted.
Notional market data – not
the actual lease on a property
– is used for valuations for
rating purposes. Chattels are
not included in the RV.
Questionnaires are sent out
to property owners to help
establish fair market value
based on active leases.
How often are they reassessed?
New RVs are produced
every three years.
How does an RV differ from an
insured value?
Insured value typically
refers to the reinstatement
cost of a building (excluding
land value) based on construction
prices, whereas an RV
is based on market sales data
and includes land and building
values.
The two valuation types
generally produce significantly
different figures.
What is the relevance of the RV
to market value?
RVs are not overly relevant
to market value. As RVs
are only updated every three
years, they quickly become out
of date.
Also, properties assessed
for rating purposes are not
inspected internally and baseline
assumptions are just that
– assumptions.
An RV may not reflect a
property’s true value, particularly
when occupancy is based
on notional lease terms and
inputs.
What factors create a “value
gap” between RV and market
value?
As RVs are only updated
three-yearly, timing is
the major contributor to
value gaps.
Additionally, baseline
inputs such as notional occupancy
terms give rise to discrepancies.
As properties are not typically
inspected internally during
the RV process, seismic
upgrades, major fitouts, quality
of interior work and other
capital improvements are often
not considered.
What general advice would
you offer sellers or purchasers
trying to determine a commercial
or industrial property’s
value?
Seek independent advice
from a qualified professional.
If a vendor engages a registered
valuer to provide a
market assessment from the
outset of a property’s sales
campaign, this can assist with
negotiations and help set value
expectations for both parties to
the transaction.
From a purchaser’s perspective,
registered valuers are
usually engaged post-transaction
for mortgage security
purposes.
https://www.bayleys.co.nz/
totalproperty/articles/knowyour-value
At Bayleys, we believe relationships are what businesses are built on and how they
succeed. We understand that to maximise the return on your property you need:
Professional property management
A business partner that understands your views and goals
Contact the Bayleys Tauranga Commercial Property Management team today.
Bayleys Tauranga
Commercial Property Management
07 579 0609
jan.cooney@bayleystauranga.co.nz
SUCCESS REALTY LTD, BAYLEYS, LICENSED UNDER THE REA ACT 2008
ALTOGETHER BETTER
Residential / Commercial / Rural / Property Services

Bay of plenty
TAURANGA
MAGAZINE
Rotorua
Hamilton
newsletter
news
BAY OF PLENTY BUSINESS NEWS March/April 2019
19
The dangers of the
social media car yard
In my role as a private investigator specialising in fraud and
financial recoveries, I have noticed two alarming developments
- a new scam targeted at recent immigrants, and some dodgy
deals aimed at vulnerable people in our community. These are the
exiting working / studying tourist scam, and the Facebook car
sales and self-financing scenario.
In the last three months we
have seen the same scenario
play out 10 times. An
overseas student or work visa
holder finances a vehicle for
around $10,000. They make all
the payments as required for
three-to-six months leading up
to the date that they are scheduled
to leave NZ for home.
They then sell the vehicle
for $5000 to a recently made
acquaintance who has just
arrived in NZ, without clearing
the $8000 or so remaining
balance on their secured loan.
The unsuspecting purchaser
then registers the vehicle in
their own name and at their
address, which is flagged on
the system of the finance company
and triggers a “security
at risk” repossession order to
be generated.
Armed with all the correct
paperwork and licenses, the
repo agents go and uplift the
vehicle. Not only is the purchaser
out $5000 and their car,
they also do not have a chance
of legal redress from the seller
who is now thousands of miles
away in another jurisdiction.
It’s never a bad investment
to do a Carjam or similar
ownership and finance check
on any vehicle purchased
privately.
The other new scheme that
seems to be becoming increasingly
popular is what we call
“Facebook financing”.
More and more Posts are
appearing on social media
pages along the lines of “car
wanted, must have warrant
or at least not de-Reg, needed
for young family, can pay
100 per week, condition not
important”.
Sometimes the posts will be
on behalf of friends or loved
ones.
But although the intention
But although the
intention seems to
be charitable and
innocent, there are
real risks for those
on both sides of the
transaction.
seems to be charitable and
innocent, there are real risks
for those on both sides of the
transaction.
If the seller has no formal
agreement, they have no rights
of vehicle recovery should
payment not be made, no right
to add late payment costs, no
control over what modifications
can be made to the vehicle
while there is still money
owing, and no proof that the
transaction even occurred.
(There have also been cases of
theft accusations against “purchasers”
that had paid deposits
before the “seller” changed
their mind).
When we are asked to
pursue debts of this nature it
is a nightmare and the value
of the time spent working it
all out and gathering proof
often eclipses the transaction
amount.
You have to think, with
all of the hundreds of vehicle
financing options that
are available, the prospective
purchaser is either so
credit unworthy that no one
will finance them, or they
potentially have fraudulent
intentions.
There is a reason why
finance companies have ID
Checks, Equifax or Centrix
credit checks, and hold PPSR
securities over vehicles.
Licensed car dealers and
finance companies are regulated
by law and these regulations
are designed to protect
consumers.
One simple question to
ask is this: if companies that
CREDIT MANAGEMENT
> BY NICK KERR
Nick Kerr is Area Manager BOP for EC Credit Control NZ Ltd.
He can be reached at nick.kerr@eccreditcontrol.co.nz
understand risk and debtor
behaviour refuse to finance
these people into vehicles,
isn’t it crazy to risk your own
money doing it?
Also for purchasers the
chances of being sold an
unsafe, badly repaired or even
written off vehicle is much
higher when these “bargain”
deals are sought out. There
are some very good cars being
sold by very honest people on
social media, but how is the
average person meant to tell
them from sellers who are not
so honest?
So remember, sometimes
a good deal can be very onesided.
Nick Kerr is also a licensed
private investigator with his
own firm, International
Private Investigations.
Bay of plenty
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20 BAY OF PLENTY BUSINESS NEWS March/April 2019
How much is my business worth?
What is the value of my business? …
This is a very common question we are
asked as Business Advisers and one
that requires a high level of skill and
experience to answer, it is also one that
would be asked more often depending
on the outcome of the proposed CGT
(capital gains tax).
You can value a house
based on its condition,
its location, the number
of rooms and the amount comparable
properties have sold
for. You can value a painting
on the reputation of the artist,
the quality of the painting
and auction prices for similar
works.
But these are tangible
values and, while most businesses
have things that can
be discreetly measured there
are many intangibles too, from
copyright and intellectual
property to brands and patents,
and many other business assets
that can add to a company’s
value.
Suffice to say, there is no
simple formula to determine
the value of your business.
Valuing a business is a very
difficult calculation for any
valuer to make unless market
conditions are perfect – that
is, where there is a true market
base with buyers and sellers
regularly entering into similar
transactions.
However, markets are volatile.
So getting an accurate valuation
of your business relies
on choosing a skilled valuer
– someone with the ability to
combine knowledge and experience
with application of valuation
principles to come up
with an ‘opinion’ on the value
of the business.
To give you an idea of what
is involved, following are
some of the key accepted principles
a valuer will use:
A hypothetical
marketplace
Here, the valuer considers the
valuation in terms of a willing,
but not anxious seller and
willing, but not anxious buyer,
with both possessing similar
facts and in friendly negotiation.
Income stream
A business’s value is determined
by the income stream it
will generate, either from the
profits/cashflow of the business
or from the ultimate realisation
of the assets of the business.
Determining the future
maintainable profits (FMP) of
the business is therefore a critical
component of the valuation
process. To determine the FMP
the valuer must not only look
at historic events, but look at
trends to provide a guide to
the future.
Appropriate multiple
Once the FMP is determined
the valuer must determine an
appropriate multiple to apply
to it. The multiple represents
the risk profile of the business.
The lower the multiple the
higher the risk profile of the
business. As an example there
may be two businesses which
generate a profit of $200,000
per annum. Business A could
have a diverse customer base,
a strong management team and
good reputation in the marketplace,
while Business B could
be heavily reliant on one customer
and only have traded
for a year. A prudent purchaser
would be prepared to pay a
greater price for Business A
than for Business B. The multiple
applied to the FMP of
Business A would therefore be
greater than Business B.
Underlying business
assets
Having considered the FMP
and appropriate multiple for
the business the valuer must
then consider the result in light
of the underlying assets of the
business. If a figure results
in a value significantly less
than the underlying net tangible
assets of the business, the
valuer should then consider the
merits of a notional liquidation
valuation. Whereas if a figure
results in a value significantly
higher than the underlying
net tangible assets, the valuer
should consider the level and
appropriateness of the resulting
goodwill element.
MONEY MATTERS
> BY STEPHEN GRAHAM
Stephen Graham is a Director and Managing Partner at BDO Rotorua,
Chartered Accountants and Advisers. To find out more
visit bdorotorua.co.nz or email rotorua@bdo.co.nz
Despite these principles,
the valuation of any business/
company is actually more art
than science. It requires the
ability to take into account
all surrounding business facts
along with knowledge of the
sector, precedents and risks
- all while making judgment
calls along the way.
Quite simply, if you’re after
an accurate assessment of the
value of your business – make
sure the valuer is experienced.
TERMS
OF TRADE
CREDIT
CHECKING /
MONITORING
DEBT
COLLECTION
Nick from
EC Credit Control
is the Bay of
Plentys leading
debt prevention
expert.
CREDIT
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nick.kerr@eccreditcontrol.co.nz | P: 027 713 2128
0800 EC GROUP | www.eccreditcontrol.co.nz

BAY OF PLENTY BUSINESS NEWS March/April 2019
21
Tauranga firm launches new
affordable housing concept
The founders of Bay-based Golden Homes
- one of New Zealand’s largest privately
owned residential building companies -
have launched a new company targeting
the country’s housing shortage.
By DAVID PORTER
Len and Jill Helms have
launched a new company,
Ubuilt, a self-starter new
kitset home, which they say
can be produced in volumes of
up to 10,000 homes a year.
Golden Homes has already
built thousands of homes
across New Zealand. Len
Helms said that the new Ubuilt
concept could be easily scaled
up because they owned the
New Zealand-based factories
that produce the frames, and
the company that sells ZX
Panel, a new non-combustible
aluminium panel cladding system.
The kitsets, which range
from $49,667 for a 45sq m
house to $85,471 for 103sq m,
would be constructed at a factory
the couple had owned for
about five years in Hewletts
Rd. The Helms own the supply
chain with 50 staff already
employed and said staff numbers
were likely to climb.
The exterior of the homes
come in 400 possible colour
An artist’s impression of a UBuilt home.
combinations. All Ubuilt kitset
homes can only be ordered
online, and the company
said they could be delivered
in New Zealand within 20
working days.
Helms has spent 40 years
in the building industry and
said it was a complex exercise
bringing Ubuilt together at the
offered pricing, especially considering
the parts were mainly
New Zealand-made.
“We wanted to bring a
beautiful home to the market
that you would be proud to
live in without compromising
value and quality,” he said.
“We designed these homes
so the buyers could assemble
their Ubuilt with a qualified
builder. If you already have
a section and a builder, then
from the time you receive your
Ubuilt to completion could be
as little as eight weeks. We
have designed the homes so
you can build your place, at
your pace – but for many there
is an urgency, as they need
somewhere to live.”
Helms has proposed that
the government and iwi con-
sider leasing land to Kiwis, so
they could erect Ubuilt homes.
“In this way they could
quickly offer New Zealanders
a warm and stylish home to
raise their family and a mort-
gage that would be cheaper
than rent.”
The leasing approach for
the land could enable banks to
provide small or zero deposit
loans, or they could use their
Kiwisaver, he said.
“There is no problem too
big, you just have to be creative.”
Ubuilt houses were
designed to maximise the
space inside and felt much
bigger than they were, he said.
Founder Len Helms: Ubuilt offers solution to housing
shortage. ZX Panel’s Steven Longhurst (below).
Photos/Supplied.
The target market would be
people on limited budgets, or
those wanting to put an extra
home on their property, build
a bach or build a sturdy investment
property.
“All Ubuilt home designs
come with double glazed thermally
broken aluminium windows
and quick to construct
ZOG Steel Framing, which is
stronger, straighter and significantly
lighter than traditional
timber.”
Houses can be viewed
online at ubuilt.co.nz or at the
Mount Maunganui showhome
by prior appointment.
New cladding system
It is designed for our country’s
weather conditions and brilliant
news for coastal buildings, as
aluminium doesn’t rust.”
- Tony Longhurst
The Ubuilt cladding system
ZX Panel, also
developed by Helms, was
recently launched as an easy
to install non-combustible system
aimed at overcoming what
the company said were the
limitations of some other commercial
cladding systems. ZX
Panel has a world-wide design
registration and pending global
patents.
ZX Panel said its system
offered a global solution for
preventing exterior fires to
buildings, because it was pure
aluminium, and did not contain
any composite. Currently
many apartments and medium-rise
buildings in New
Zealand use composite claddings,
which ZX Panel said
were potentially flammable.
National manager Tony
Longhurst said ZX Panel was
the only fire-resistant cladding
product of its kind in New
Zealand.
“The ZX Panel® has been
thoroughly tested and passed
all of the relevant independent
tests to ensure maximum
safety and product preference,
including fire,” he said.
Golden Homes founder Len
Helms had spent the past five
years working on creating this
system. .
“We have spent thousands
of hours dreaming, researching,
debating, tinkering,
assembling and testing our
product,” said Helms.
“Our end goal has always
been to help the person building
a house or a medium-rise,
to try and bring down the cost
while offering an aesthetic
design look, ensure weather-tightness
and be non-combustible
- and we have definitely
achieved that.”
ZX Panel has been
approved for residential homes
up to 10m high, and approvals
were pending for medium rises
up to 25m.
Designed from the ground
up, the ZX Panel system was
made up of a two mm thick
powder coated aluminium
panel, which was clipped into
specially engineered aluminium
extrusions to create what
the company said was a reliable,
robust cladding system.
“It is designed for our
country’s weather conditions
and brilliant news for coastal
buildings, as aluminium
doesn’t rust,” said Longhurst.
The ZX Panel system was
made from 100 percent recyclable
aluminium, he said.
Altus, a company located
in Hamilton, extruded and produced
all of the products then
powder coated the necessary
exposed items and carried a
New Zealand Made trademark,
said Longhurst.
People can order online or
through Carters, Placemakers
and ITM New Zealand. ZX
Panel said it could also arrange
installation solutions through a
network of approved installers.

Bay of plenty
CONNECTING
BUYERS AND
SELLERS OF
QUALITY
BUSINESSES
First on the scene
Photos from the recent Business Bubble Breakfast networking event held at Vinyl
Destination. This was fourth of these annual events, run by INfuzed in collaboration with
Small Business Tauranga, and with sponsorship this year for the first time, by Brother NZ.
Photos/Sue Wilson, Messenger Marketing
When is the right time to sell
your business? Right now.
At TABAK, we promise to guide
you through the sales process
with focus, integrity and
complete confidentiality.
1 2
1 Tenby Powell (Small Business Council of NZ), Craig Hudson (Xero), Zita Cameron (Infuzed), Steven Farrant (Small Business
Tauranga), and Grant Young (Brother). 2 Jill Fryer (Upshot NZ) and Stan Gregec (Tauranga Chamber of Commerce).
FOCUS • INTEGRITY
CONFIDENTIALITY
3 4
3 Tony Snow (Stratus Blue) Andrew Aldred (Brother NZ) 4 Katie English (Vital Sure), Tenby Powell (NZ Small Business
Council) and Holly Bennett (HSB Consulting).
WHY TABAK
INDUSTRY EXPERIENCE
REALISTIC APPRAISALS
5 6 7
5 Steve Warburton (Prime Rentals) and Mark Irving (Priority One). 6 Nicole Santos (Park Lane Jewellery), Tim Taylor (Stratus
Blue) and Antony Cameron (INfuzed). 7 Nico de Jong (The Loft Legal) and Aaron Wheeler (Cell Wellbeing).
TEAM APPROACH
PRE-QUALIFIED BUYERS
P5177Y
147 Cameron Road
p. 07 578 6329
e. tauranga@tabak.co.nz
w. tabak.co.nz
8 9
8 Fiona Coupland (Wealth Health), Zita Cameron (Infuzed) and Stuart Harris (Wealth Health). 9 Camella Anselmi (Link
Business Sales), Craig Hudson (Xero) and Natasha Arnott (Mount Osteopaths).

BAY OF PLENTY BUSINESS NEWS March/April 2019
23
Bay of plenty
First on the scene
Photos from the Tauranga Chamber of Commerce BA5 networking
event hosted by Crombie Lockwood.
Photos by Helen Chapman Photography
1 2 3
1 Rachel Gemming, EY; Chris Turner, Balanced Success, with
Andrew Taylor, Video Storyteller.
2 Rose Gilmore, Stratus Blue and Stacie Taylor, BOP
Business News.
3 Brett Down, Crombie Lockwood.
4 5 6
4 Tami Hadfield, Flowers by Tami; Sindy Saunders and Roger
Smith, Eves; with Vanessa Laval-Glad, Indigo Moon Photograpohy.
5 Steve Munford, Brandline-Messenger Marketing NZ with
Richard Chelley and Lynn Irving, NZISM Tauranga.
6 Connie Smith, Beca; Emma Hotchin and Stephanie Joblin,
Talent ID Recruitment, and Sonia Tibble, Beca.
7
7 Bronwyn Jackson, Grief Support services and Adrienne von
Tunzlemann, McKinlay Douglas.
8
8 Wayne Lowry, Vodafone; Reynar Hodge, IOCA and Dean Howie,
University of Waikato.
9
9 Stan Gregec, Tauranga Chamber of Commerce; Margaret
Holes, Engine Room Chartered Accountants; Andy Cameron,
Oasis Engineering and Brett Yeatman, N-Gon Group.
10
11
10 Ryan Waite and Heather Down, Crombie Lockwood. 11 Rosie Mallon, smarterworks-nz; Laura Clayson, Soul Design Group with Sally Green and Chloe
Grantham, DropIt.

24 BAY OF PLENTY BUSINESS NEWS March/April 2019
Seeka acquires Aongatete
Coolstores for $25 million
Seeka has agreed to buy the kiwifruit
orcharding, packing and coolstore business
and assets of Aongatete Coolstores in the
Bay of Plenty for $25 million.
Seeka chief executive
Michael Franks said the
acquisition was aligned
to the company’s growth strategy
and builds on Seeka’s
kiwifruit foundation.
“Aongatete’s kiwifruit
packhouse and coolstore
facility processes around 4.5
million trays of Green and
Seeka CEO Michael Franks.
Gold fruit, providing Seeka
additional market presence in
a growth industry,” he said.
“The acquisition complements
our existing business
with further infrastructure in a
great growing location.”
NZX-listed Seeka is the
biggest kiwifruit producer
in Australasia and a major
post-harvest operator. In addition
to increasing Seeka’s
catchment, the purchase was
expected to increase business
performance and deliver sustainable
EBITDA of between
$3.5 million and $4.5 million,
the company said.
Aongatete is an integrated
kiwifruit orcharding and
post-harvest company operating
across the Bay of Plenty.
The assets acquired are of
excellent quality and according
to a statement from Seeka,
the people and operation are
renowned for their excellent
performance for growers,
grower focus and furthering
technology.
Aongatete Coolstores was
founded in 1983 by Allan
Dawson and Roger Stiles,
who secured the site of the
old Aongatete Railway Station
alongside State Highway 2,
Katikati, and bought the land
from New Zealand Railways.
The company went on to build
a coolstore and packhouse and
then began to lease and manage
orchards.
Seeka plans to retain all
permanent staff and will
continue to provide services
and support to growers who
have been supplying fruit to
Aongatete.
Michael Franks said the
facilities and team had a considerable
reputation for efficiency
and innovation.
“This season’s harvest
is underway with orchards
already being picked and it
will continue to operate under
the existing experienced
team,” he said.
“Our focus will be to deliver
support to the team as they
need it.”
Allan Dawson, who continues
to serve as managing
director, said growers’ futures
would stand in good stead
with Seeka.
“Seeka brings its own
skills and economies of scale
and recognises the Aongatete
site will remain a centre of
excellence and innovation
for the kiwifruit industry,” he
said.
Seeka is committed to the
local area and sees benefits
for both existing and new staff
and grower partners.
“Seeka’s significant size
and scope brings increased
capacity and ability to support
the Aongatete site during peak
harvest times,” said Franks.
“With Seeka’s geographical
spread throughout the Bay
of Plenty transport distances
can be reduced with fruit processed
closer to where it is
grown.”
Seeka said another benefit
for Aongatete was that its
Grower Shares Scheme and
Employee Share Scheme will
be offered to new associates.
The Scheme is an opportunity
for growers and staff to benefit
from being part of Seeka
and share in returns generated
by the business.
The purchase was expected
to settle in March, and the
facilities will be rebranded as
Seeka Aongatete.
Gates
Fences
Balustrades
Automation
0800 2 GATES www.RedStagGatesAndFences.co.nz info@RSgates.co.nz
Red Stag Gates and Fences, your Tauranga experts since 2007.
Helping our clients feel safe and secure

BAY OF PLENTY BUSINESS NEWS March/April 2019
25
Taking the first
hydrofoil e-bike
to the world
Manta5 asked Company-X to design
and develop four e-commerce
websites simultaneously.
When you’re launching
the world's first
hydrofoil e-bike you
need multiple websites internationally
that can withstand
hundreds of thousands of hits
per month.
Hamilton-based Manta5
designed and developed the
$7490 Hydrofoiler XE-1 in
New Zealand for riding over
lakes, rivers and oceans.
“We had developed a minimum
viable website,” says
Manta5 chief executive Greg
Johnston.
“We chose Company-X to
take it to the next level in preparation
for international sales
because we knew they had the
knowhow for building e-commerce
websites that could sell
the Hydrofoiler XE-1 in multiple
regions across the world.”
Manta5 approached
Company-X professional services
manager Michael Hamid
for help.
“We have worked with
Michael on multiple projects,”
says Greg. “He ran the software
development team that
supported Torpedo7 and 1-day
for Manta5 founder and director
Guy Howard-Willis and his
son Luke.
“Manta5 marketing manager
Louis Wilks and I came in
and spoke to Michael, and he
was able to bring in designer
and developer Pete Stewart
who had skills in the Shopify
front end.”
The Shopify e-commerce
platform was designed with
online stores and retail pointof-sale
systems in mind.
“We got a lot of value out
of talking to Pete,” Greg says.
DESIGNER AND DEVELOPER:
Company-X's Pete Stewart.
“We understood what he was
really good at. Pete was up
front about what he could do
and was quite happy to collaborate
with another developer
on it.”
Manta5 appreciated
Company-X’s honesty and
transparency.
Pete did a really
good job of getting
a good balance
between what we
wanted and what we
needed.
Company-X gave Manta5
direct access to its systems
for planning, tracking and
launching the websites in
New Zealand, the European
Union, United Kingdom and
the United States.
It was equally valuable
for Pete to have quick and
easy access to the Hydrofoiler
XE-1 subject matter experts at
Manta5.
“Manta5 provided a
style guide and photos and I
designed some mockups based
on their existing website,” Pete
says. “I worked directly with
Louis, which meant I could
gather their requirements, and
also implement any changes
they required quickly.”
It took about six weeks from
the start of design to launch
the New Zealand website and
about another month to launch
EU, UK and US websites.
“Michael did a great job
making sure that everything
worked beautifully,” Louis
says. “Pete was understanding
of our needs and great to
work with. If we had a question
he was straight there with an
answer no matter what time of
day or night we asked. It was
very reassuring to have someone
like that working on our
e-commerce site.
“Pete did a really good
job of getting a good balance
between what we wanted and
what we needed.”
The Hydrofoiler XE-1
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26 BAY OF PLENTY BUSINESS NEWS March/April 2019
Lessons from the
pub for business
storytellers
In my earlier years working as a journalist, a wily old editor
once told me to always write as if I was talking to a good
mate at the pub.
TELLING YOUR STORY
> BY JAMES HEFFIELD
Director of Bay of Plenty marketing and PR consultancy Last
Word. To find out more visit lastwordmedia.co.nz or email
james@lastwordmedia.co.nz.
Taking this advice literally
could have ended
badly, especially if my
pub language had been particularly
colourful or I had a
penchant for clichés after a
few drinks.
But for me, it was an epiphany,
and it got me thinking
about the kind of language that
resonates with people and how
to construct a story that holds
people’s attention.
One of the main points he
was trying to make was that
the most powerful stories are
told in plain English.
Most people leave their
buzzwords and jargon behind
before visiting the pub, and in
cases where a shorter word can
be substituted for a longer one,
Jargon, buzzwords
and overly complex
language will lose a
large portion of your
audience before they
have read or listened
to what you want to
tell them.
the wise storyteller will opt for
the simpler option.
This is sound advice for
business writers as well as
journalists.
Jargon, buzzwords and
overly complex language will
lose a large portion of your
audience before they have read
or listened to what you want to
tell them.
Your point may be a stroke
of genius, but if they can’t
understand or aren’t engaged,
they are very likely to miss it.
The way you construct a
story is critical as well, whether
you are articulating what
your business stands for or
trying to sell a product.
In the pub setting, there’s
nothing worse than hearing the
vagaries of what someone had
for breakfast, how the weather
was and how many steps it
took to get across the street
before they get to the main
point of their story.
If the point is that earlier
in the day you escaped a
mugging, don’t bore people
with all the lead-up. It’s much
more effective to start with
the key point – “I just escaped
a mugging” – before filling
them in on who was after you,
when and where it happened,
how you escaped and why you
think they chose to go after
you specifically.
The key is to understand
your audience and then tell
them what it is they most want
to know up front.
You can then fill them in
on the background information
once you’ve piqued their
interest.
In a news sense, the opening
sentence of your story is
known as your hook, but it’s
equally important in business
when you want people to take
notice and become invested in
reading or listening to the rest
of what you have to say.
When writing a product
description, it’s usually best
to start with why the product
exists and how it will change
people’s lives, rather than leading
with technical specifications
such as its size, weight
and the materials used in its
manufacture.
Having a strong hook
will also help you write an
engaging company profile,
and increase your chances of
securing grant funding or winning
that award you’ve been
nominated for.
Strong storytelling can be
the difference between success
and failure. It pays to get it
right, so always consider your
audience and make the effort
to tell your story in a way that
will engage them and be easy
to follow and understand.
Employee feedback is crucial
Employee feedback is vital
to the ongoing development
of your employees
and to your business as a
whole. After all, a business
is only as good as the people
within it, and good leadership
means supporting and encouraging
the talent within your
organisation.
Employee feedback is an
essential tool to help ensure
everyone is operating to their
full potential and fully engaged
in the business.
And giving quality feedback
and being open to it
makes it easier to improve
and develop performance over
time.
Positive feedback is easy
– it’s not hard to tell someone
they’ve done a good job, or
congratulate them on meeting
targets.
But it’s easy to become
complacent about giving praise
when things are going well.
On the other hand, giving
negative feedback is not as
simple. It’s human nature to
put off difficult conversations.
And seeking two-way feedback
can be tricky where there
is a power imbalance – not
everyone is comfortable “critiquing”
the boss.
Having a process in place
for attaining 360-degree feedback
on a regular basis is
important.
But a process for actioning
that feedback is just as important
and is often overlooked.
Collecting feedback is just
the start of the process.
It’s what you do with that
information – the focus areas
you identify and the actions
you take to address them – that
impacts employee engagement
and satisfaction within your
organisation.
Ultimately, engagement
is the outcome of an ongoing
process referred to as the
employee feedback loop – collect,
understand, act. And it’s
the “act” part that I often see
letting businesses down.
Ultimately,
engagement is
the outcome of an
ongoing process
referred to as the
employee feedback
loop – collect,
understand, act. And
it’s the “act” part that
I often see letting
businesses down.
In fact, consistently failing
to communicate and act
on employee feedback can be
quite detrimental.
Employees become sceptical:
they become less willing
to provide candid and honest
feedback, they feel disappointed
at the lack of action and
begin to see the process as
pointless.
If you’re not going to act on
it and follow-up, there is little
point gathering feedback
When employees offer
feedback, they do so with the
hope that there may be action
or change.
People want to be listened
to and acknowledged.
They hope to make a difference
in some way, especially
when they are frustrated
by something or see an
opportunity that isn’t being
capitalised on.
This isn’t to say something
always needs to happen on
every single piece of feedback,
but you do need to close the
loop and share results to let
employees know they have
been heard.
Organisations need to
carefully review and analyse
HUMAN RESOURCES
> BY KELLIE HAMLETT
Director, Recruitment & HR Specialist, Talent ID Recruitment Ltd
what has been learned through
employee feedback and be
as transparent as possible in
responding.
This transparency and honesty
is a vital aspect of the
process.
Letting people know you
have listened to them and
showing them how the feedback
is being actioned is an
essential ingredient for motivation
and engagement.
A good feedback process
where employees feel listened
to, and that their opinions
are valued, aids a positive
company culture, improved
engagement levels, and ultimately
may improve the bottom
line with value added
improvements.
Remember the loop:
collect, understand, act.

BAY OF PLENTY BUSINESS NEWS March/April 2019
27
Navigating the process of purchasing a
business
In many cases, it makes sense to buy an
existing business. You skip the risky startup
phase and gain an existing brand, client
base, staff, and stock.
Once you have found
the business you’d like
to purchase and have
researched all aspects, it’s time
to register formal interest and
start due diligence — the process
of understanding what
assets, liabilities and commercial
potential a business has.
At that time, it is important
to appoint an adviser who can
assist you further. Professional
advice is important to make
sure all bases are covered, but
getting a lawyer and accountant
on board also improves
your credibility as a buyer.
“A lawyer’s role in the process
of acquiring a business is
more than preparing a Sales
and Purchase Agreement or
reviewing a lease document,
and incorporating a new entity
with the Companies Office,”
says Paula Lines from The
Law Shop.
“Our team can assist in
investigating all the important
components of the process, as
part of the due diligence process.
We’ll make sure
you understand the risks
involved, and alongside
you, we’ll look
at everything,’” she
explains.
When you buy
a business that has
stock, you’ll usually
see a “stock adjustment
percentage” in the
Agreement for Sale and
Purchase. This takes
into account the fact
that stock fluctuates day
to day, maybe hour by
hour, in the business.
“What you have on
hand today could be
quite different from
what is available tomorrow.
From a buyers perspective,
you want to know
that you are going to have
enough stock to trade immediately
after settlement and that
it is all good, saleable stock,
not stuff that has expired or is
obsolete,” Paula says.
“From a seller’s perspective,
you want to get reimbursed
for all the stock you
have paid for prior to settlement.
The stock adjustment
percentage takes some of the
risks out for both buyer and
seller,” she explains.
Paula clarifies that you
agree a price for the stock –
whatever the seller would normally
have on hand – and you
agree on a percentage for it to
be adjusted by. Say you’ve got
$10,000 of stock and a SAP
of 10%. Either the day before
settlement after the business
closes or that morning, the
parties do a joint stocktake and
come up with a figure.
“If it’s between $9,000 and
$11,000, the buyer will pay
the actual amount. If it’s more
than $11,000, the buyer can
either buy it all and pay the
actual amount or pay $11,000
and choose what the seller
takes away. If it’s less than
$9,000, the buyer pays the actual
amount but the vendor may
be in breach of the warranty to
keep sufficient stock,” she says.
The team at The Law Shop
has decades of experience with
handling business transactions
and negotiation strategies and
will make sure that all legal
issues are brought to your
attention and your interests
are protected. Contact their
Rotorua or Tauranga office
today or visit www.thelawshop.co.nz
to book in a confidential
conversation about
your business purchase.
STEPHANIE NORTHEY
LL.B | Director
PAULA LINES
LL.B | Director
SARSHA TYRRELL
LL.B | Director
ROTORUA
1268 Arawa St
Rotorua
TAURANGA
1239 Cameron Rd
Greerton

Absolutely
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Contact
Cameron Macneil 021 800 889
Jason Eves 027 587 5509
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Jason Eves 027 587 5509
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Redefined
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Cameron Macneil 021 800 889
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Rural Sunsets
157 Pukehina Parade, Pukehina Beach
Price
Enquiries Over $1,400,000
Contact
Jason Eves 027 587 5509
Cameron Macneil 021 800 889
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Private Retreat
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SOLD
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Cameron Macneil 021 800 889
Jason Eves 027 587 5509
It Doesn’t Get
Much Better
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SOLD
Contact
Cameron Macneil 021 800 889
Jason Eves 027 587 5509
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Beautiful Life
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Price
Enquiries Over $1,575,000
Contact
Jason Eves 027 587 5509
Cameron Macneil 021 800 889
Trusted to sell Bay of Plenty’s finest homes and lifestyle properties.
Oliver Road Estate Agents Limited | Licensed REAA 2008
oliverroad.co.nz