Monthly Archives: August 2020

Kane Williamson blasts Rockit apples into major marketing push

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Innovative New Zealand apple company Rockit Global Limited, recognised across the world for its miniature Rockit™ apple variety, has today announced an inaugural Global Ambassador partnership with Kiwi cricketer Kane Williamson.

The New Zealand cricket captain, who will shortly leave New Zealand to begin his season with the prestigious Indian Premier League (IPL), says joining Rockit™ is exciting, and he can’t wait to get started. “I love getting hands-on with the brands I align with, and Rockit is a great product – one that I’m passionate about driving forward,” Kane says.

Rockit Global’s General Manager Global Marketing, Julian Smith, says the partnership is a significant step for the organisation. “Establishing a Global Ambassador role for Rockit will, we believe, have a hugely positive impact on our international marketing and brand awareness. Kane is an outstanding example of a New Zealander with drive and determination who has taken on the world – just like Rockit.”

The arrangement will see Kane champion Rockit™ apples to a cricket-mad audience worldwide. With Rockit Global’s plans to tackle the high-end produce category in India this year, Kane’s involvement will also help introduce the small, sweet, snack apples to a potential market of millions of discerning Indian consumers. “It’s a really exciting opportunity to venture into this market,” explains Kane, who has a huge following in India. “As Kiwis, we already know that the produce we’re able to generate in New Zealand is of the highest quality and I know that when consumers in India and other countries get the opportunity to try a Rockit apple, they’ll really enjoy them.”

Kane will be involved in digital activations, marketing and events for Rockit™. It’s also the first time Kane has approved insignia on his bat, which – for the duration of the IPL season – will proudly carry Rockit™ branding. Kane says he would only ever want his bat to bear branding that aligns with his own core values and ethos. “The fit is without doubt the primary thing I look at when considering a commercial alignment, so this is the first time there’s been any other branding on my bat. While there have been other opportunities in the past, I’d wanted to keep that space clear for the right endorsement.”

Why Rockit™? Kane has a direct interest in Rockit™ orchards, an investment interest in brand owner Rockit Global via Oriens Capital, and wholeheartedly believes in the quality of the produce. “Healthy eating is a big part of my lifestyle, and it’s clear to me what a great snack Rockit is. The size is great, and the flavour is incredible.”

Kane recently travelled to Hawke’s Bay to see first-hand how the apples are grown, and to meet the people behind the brand. He says despite the obvious setbacks Covid-19 has created – including the fact the IPL will be played in the United Arab Emirates this season – it has also allowed him the time and freedom to fully explore the partnership presented to him by Rockit Global. “I’d always wanted to look at opportunities that are Kiwi, and that hold relevance to who we are as a country and what we do. For me, the primary sector represents that, and once I met the team at Rockit, I knew the alignment made sense. I’m passionate about the product, it’s healthy, it’s authentic, and it’s purposeful.”

Julian says the entire Rockit Global team is delighted with the arrangement and that Kane’s reputation as an outstanding sportsman, inspirational leader and exceptional New Zealander make him the ideal partner. “Kane’s an excellent fit for Rockit as he – and we – strive for new goals around the globe. We welcome him on board.”

Hastings Distillers Takes Gold in Global Competition

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It’s been operating for just eight months, but Hastings Distillers has already won global acclaim, earning a much sought-after gold medal at the International Wine and Spirits Competition (IWSC).

Hastings Distillers’ Albertine gin took the sole gold awarded in the Contemporary Gin category at the IWSC, a competition that has, for over 50 years, rewarded excellence in drinks worldwide.

Based within Hastings’ eclectic East 200 precinct – a thriving artisanal community – Hastings Distillers was established in 2019 by Kate Galloway and David Ramonteu, offering New Zealand’s first Biogro-certified organic spirits and liquers. Producing its range of unique gin, using botanicals sourced from the distillery’s carefully tended “gin gardens”, Hastings Distillers also offers a stylish tasting room at 231 Heretaunga Street East. Here, guests can sample the three products in the Hastings Distillers range, enjoy a bite to eat, or buy a bottle to savour at home.

The award-winning Albertine gin contains 38 organic botanicals and is batch distilled in a 150L Arnold Holstein still, then cut to strength with local Kaweka spring water. It can be enjoyed as a contemporary gin and tonic, on ice as a sipping gin or as a base ingredient in a cocktail.

IWSC judges praised its “complex and perfumed nose”, noting that the Albertine is “layered with intense lemon, pine and fresh green fruit…fruity, refined and fragrant…complimented by a clean balance of juniper and fresh fruit”.

Kate says it’s an honour to have been recognised in a competition widely regarded as the most prestigious in the world. “Our passion has always been to create premium craft spirits that follow nature’s lead, drawing on our broad background in winemaking to develop our love of all things botanical. It’s wonderful that our small, family business has captured the attention of the judges, and helped to put New Zealand organic gin – and Hastings in particular – on the map.”

Adds David: “Winning this award is very encouraging and a real testament to what can be achieved when following your instincts and ideologies. We are pleased and very proud that while our products align strongly with our artistic ambitions, they have also stood up to a panel of experts.”

The Albertine gin is one of three craft spirits produced by Hastings Distillers – their East Block 200 gin and L’Opera aperitif complete the line-up. In addition to their Hastings off-license store, online shop and tasting room, there are plans to establish a stall at the much-loved Hawke’s Bay Farmers’ Market in the very near future.

New chair and two board appointments at Hawke’s Bay Airport

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Hawke’s Bay Airport shareholders Napier City Council, Hastings District Council and the Crown has appointed a new chair and two board members.

Wendie Harvey, a board member for four years steps up as the new chair, replacing retiring long standing chair Tony Porter while the councils have jointly appointed Jon Nichols as their representative and the Crown has appointed Sarah Reo.


They join Sarah Park as a board member, who’s position has been extended for a further year to ensure board continuity. Ms Reo, a local business owner and Fulbright scholar replaces Taine Randell while Mr Nichols, a chartered accountant and highly experienced board director is the replacement to Mr Porter.

Ms Harvey says despite the recent turbulent times at the airport such as the receivership of the airport’s terminal expansion construction contractor Arrow International; the withdrawal of air services by Jet Star and the drop in passenger numbers due to Covid 19, she is confident in the future long term prospects of the airport.

She says the Airport Company has a high calibre chief executive in Stuart Ainslie with strong aviation and commercial experience, that has identified non-aviation commercial opportunities.

“I’m confident that with Stuart at the helm, ably supported by a strong management team and governance board we are heading in the right direction.

“There has been some set backs but that’s not stopping us with our vision to be the best provincial airport in New Zealand. We have had to reset our targets, especially in passenger numbers but we are progressing well with other commercial opportunities such as a solar energy park as well as commercial property development prospects.”

Ms Harvey said management, board and its shareholders are looking forward to the opening of the expanded airport terminal, set to open in February 2021.

“We can’t wait. It’s going to celebrate and promote our amazing region and tell the cultural story of Ahuriri. The airport is going to truly be the gateway welcoming people to Hawke’s Bay.

Ms Harvey paid tribute to the outstanding service and huge contributions by Mr Porter and Mr Randell. Mr Porter was been instrumental in ensuring the expansion project has progressed including quickly establishing a subsidiary company of the airport to continue with the construction project in 2018.

“Tony has been rock solid in his leadership and has been instrumental in pushing ahead with the terminal redevelopment and his experience has got us through some dark days. When the airport opens, it will in part be due to his valued contribution and unshakable drive.

“Taine has also made a very strong contribution with his forward-focussed strategic outlook.

“They’re being replaced by some high calibre newcomers. Our shareholders have listened to the skills, experience and diversity we need,” Ms Harvey said.

Mr Nichols has extensive governance experience with previous board appointments including Napier Port. He is currently a director of Eastland Group Ltd and its subsidiaries, a board member of Palmerston North Airport Ltd, chair of electricity lines company Centralines and is the independent chair of the Hastings District Council’s audit and assurance subcommittee. Jon is also the independent chair of the audit and risk committee of Maungaharuru Tangitu Trust.

Ms Reo (Ngāti Kahungungu and Ngāi Tahu) of Hastings, founded award-winning Māori language and culture business CultureFlow and CultureFlow China, which concentrates on teaching English.

Ms Reo, alumni of VUW ( LLB/BA) also holds an MBA from University of Hawaii, having graduated as a Fulbright Scholar in 2017. She has been involved in a number of community projects and is a member of the New Zealand Institute of Directors. Her skills in Māori business, law and administration will add value to the board.

Hastings District Council Mayor Sandra Hazlehurst and Napier City Council Mayor Kirsten Wise said although there was strong interest in the joint council appointee role Mr Nichols extensive governance and asset management experience set him apart.

“We are pleased to appoint Jon Nichols to the Hawke’s Bay Airport board with his experience covering aviation, ports and the electricity sector,” said Mayor Hazlehurst.

“Mr Nichols is genuinely excited to be part of a key Hawke’s Bay gateway asset and his skill set will add immense value to the changing times the airport company and the Board is working through,” said Mayor Wise.

The councils are also pleased with the appointment of Ms Harvey as chair, saying she is highly regarded with vast governance and corporate experience including Napier Port, Centralines, Aurora Energy, ETCO (Electrical Training Company Ltd) and Fire and Emergency New Zealand. Ms Harvey also serves as a Commissioner on the New Zealand Gambling Commission.

Be part of the Hastings success story

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In the context of a global pandemic recovery, investors are reconsidering all capital decisions. Now, more than ever, regional centres are being looked at for commercial property opportunities. And Hastings, is no exception.

Rob Gill, Director and Owner of Hastings Hive, Hastings’ first large scale co-working space, and the larger site that encompasses the Kiwibank National Operations Centre, sought out Hastings to invest due to its good business fundamentals.

“Hastings has excellent infrastructure and acts as the region’s service hub, thus attracting new business, business investment and workers,” Rob says.

The current low interest rate environment supports the case for portfolio diversification, and drives demand for regional centres of New Zealand.

Rob, and wife Jenny, own a small private company with commercial buildings and shared office spaces spread throughout the North Island.

Rob placed a strategic bet on Hastings growing faster and more steadily than most other centres in NZ, saying “the fundamentals of the Hawke’s Bay economy look good, demand should hold up well and growth will continue steadily as more companies move their business and families to the Bay for access to stable staff and better quality of life, that New Zealanders so value.”

The important part for the Gill’s, which rings true for any investment opportunity, is “to be focused on being part of the Hastings and Hawke’s Bay success story, and to put local business first.”

“Developing what the local market will need in the next ten years, is likely a better bet than trying to guess whether a building will make money…and if you want to understand this, just ask the locals.”

Passionate owners and operators breathe life into Hastings

There’s a growing band of locals working to inject new vitality and economic diversity into the CBD. A key player, Rob Hansen – Principal, Hansen Property Group is currently redeveloping the old Hawke’s Bay Today site, now called Tribune, situated east of Heretaunga Street.

The project is a mixed-use precinct of office, retail and hospitality set in an urban garden, for locals and visitors to work, connect, socialise and be entertained.

The fundamentals of Hawke’s Bay “positions it well over this time, and Hastings is currently an affordable place to invest,” Rob says.

In light of COVID-19, and the impact to commercial property, well-known investment adviser and author Martin Hawes says “I think this will be a time when yet again quality comes through…quality of the location and especially quality of the tenant.”

Bay Plaza Investment Director Hugh Lambie, credits the combination of experience and the backing of national tenants for the success of the $4 million redevelopment of Bay Plaza Shopping Centre.

“It (the redevelopment) was a good long-term investment where we’re still continuing to see growth.

“Landlords will be taking a closer look at the quality of tenants and the people behind the businesses. It’s all about the ability of the tenant to be able to pay the rent.”

Bay Plaza was an existing run-down shopping centre, purchased in 2012, with short leases and no capital investment for over a decade. It desperately needed significant capital investment, and experienced developers with strong contacts to bring tenants to Hawke’s Bay.

The growth story of this region enticed ten new national tenants to Bay Plaza, with some of these tenants going on to open additional stores locally.

Bay Plaza owners are currently looking at this region for further investment due to the strong economic fundamentals.

Recovering and thriving

Hastings Business Association General Manager Anita Alder says while so much is still unknown in the wake of COVID-19, what is known is the general desire amongst the kiwi population to support local.

Many Hastings businesses will rely on this sense of community and investment to get them through these lean times and back on their feet.

Ongoing investment in Hastings, including domestic tourism will be an opportunity for Hastings in coming months – a perfect getaway weekend location.

“There is of course opportunity even within a crisis. It allows us the time to reflect, to rediscover what it is most important to us – including giving back, sharing and investing in our community.

“It’s these values that the Heart of Hawke’s Bay needs as we all recover and begin to thrive together,” she says.

Bubble bursts for tourism in the Bay – but it will rise again

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Tourism was the first casualty of COVID-19 with no international tourists flying in, nor any NZers able to travel outside of the region during full lockdown. This was a major hit for many of Hawke’s Bay’s tourism operators as well as the hospitality sector.

Tourism is a major economic earner for the region, to the sum of $690 million and for sometime Hawke’s Bay like many other regions will now be relying on domestic tourism. We will also be hotly competing to lure the likes of Aucklanders and Wellingtonians to the Bay and up against the likes of Rotorua, Queenstown and Nelson. So what do we have planned? The Profit has put some questions to Hamish Saxton, the general manager of HB Tourism.

Tourism has been one of the first sectors to feel the impact of COVID-19. What was the initial response from local tourism operators?
We’re a resilient and positive bunch – but it’s hard when you remove our customers completely. But it’s not just our tourism operators – when you remove the visitor economy from the entire local economy, we all feel it. We lose the vibe and the energy of visitors enjoying the place that we love to show off. When you have no-one to show off to, it’s an extremely lonely existence!

What types of support has HBT provided tourism operators since the crisis began?
As a membership organisation, and as the representative organisation of an important sector of our economy, we worked to provide support, leadership, knowledge, guidance – and what we couldn’t do, we worked to find the right agency that could.

We wanted to be informed (so we could share what we knew), we wanted to be transparent, we wanted to be available, we wanted to be empathetic, we wanted to be the go-to.

In addition, we provided a 12 month membership holiday for members, we increased frequency of communications/updates through newsletter, revitalised our Facebook site for industry/ members, and made access really easy.

We also created an informal Friday “chinwag” sessions with members on Zoom, surveyed members/stakeholders at each level so we can represent (and understand/respond to) the needs of our industry.

We worked with visitor economy/members (eg promoted Chamber of Commerce initiative to members), developed workshops to strengthen businesses as well as worked with the hospitality sector on a deliveries initiative for Level 3.

We developed a Hawkes Bay Tourism Recovery Marketing Strategy – working to generate business from Locals, Inter- regional, the drive market (within 4 hours) and the Fly market domestically.

You were a casualty yourself – being forced into isolation early, due to being overseas. How did you manage to keep up your connection with stakeholders at that time?

It’s true, I had 9 days of quarantine before Level 4 lockdown commenced. But I had my phone, laptop, zoom, skype, messenger, and Facebook – there was not a minute when I was not contactable. Most of my ‘holiday’ was spent in a hotel room using my phone like a laptop, on emails and reading reports, dealing with the looming challenges of COVID-19 on our sector. It’s amazing how you just adapt to the situation. And then I came home and entered quarantine.

You have managed to turn quickly into looking for solutions, and have sought outside advice and support which helped come up with the Baycation idea, was it hard coming to a conclusion on what idea (s) to run with, or was this a stand out from the start?

Pre-Covid our strategic intent was developing a focus on Wellington, so the pandemic brought this forward and forced us to crystallise our thinking. The relative clarity/guidance from government regarding the alert levels meant that staycations would be the earliest stage of travel (either local or inter- regional). Staycation easily morphed into Baycation, and the concept was quickly embraced by industry, locals and media alike. Our thinking was aligned. We worked with enthusiastic supporters who were so keen to see Hawke’s Bay succeed. We knew we had to work with urgency and work in conjunction with our industry.

Is there any particular type of tourism business/offering that will ride this out better than others?
The answer will be “the types of offerings domestic visitors have demand for”. As New Zealand’s food and wine country, we know that people love coming here for our food and wine offerings, our outdoor leisure offerings – cycleways, walkways, beaches, gardens, our architectural heritage – and our climate. My understanding is that numerous businesses enjoyed our Queen’s Birthday visitors – accommodation, hospitality, attractions, activities and retail! Our challenge will be to out- compete the other 30 tourism regions in New Zealand who will be vying for the attention of our market. We need to get “more than our fair share”.

When do you think we are likely to see the big HB events come back on stream?
I really hope that Level 1 will allow big events to occur. I really hope that the safe management of our health, and our own individual respect and responsibility for the recommended social behaviour will see confidence return without compromise – and therefore the demand for events. Outdoor events may be more palatable in the first instance. We have so many great reasons to attract people to our region and planning is well underway – including the Sotheby’s Hawke’s Bay Marathon, Central Hawke’s Bay Springfling, Hawke’s Bay Arts Festival, Hawke’s Bay Wine Auction, F.A.W.C!, Holly Hospice – and so much more.

Do you think there will be an emergence of a new tourism offering – and what could this/these be?
In normal circumstances, 75 percent of our market is domestic. For the next few months, it’ll be 100 percent domestic and then (hopefully) we’ll have a trans-Tasman bubble. So, our target market already loves what we have, and they’ll be drawn to events. The domestic market will come to visit friends and family. They’ll want to see something familiar and maybe they’ll do something new, which may be something we already have that they’ve not enjoyed before. We have a lot to explore, from the fantastic heritage offerings of Ongaonga to the glorious natural hot springs of Morere (and everything in between) – there’s a multitude of different Baycations to enjoy! They’ll come for our reputation as a food and wine destination, for family leisure and for the holiday vibe. They’ll come for our authentic offerings. Demand will dictate. And lastly, perhaps there will be the emergence of new offerings that I simply can’t predict . What do they say – necessity is the mother of invention – so the entrepreneurial spirit may deliver something the crystal ball doesn’t show.

You are asking Wellingtonians to support HB and come and visit. If you’re thinking of your next holiday destination – where will it be and why?
Like many New Zealanders I have a great desire to catch up with friends and family – and to do a few things I’ve not done before. So, I’ve committed to a you-beaut 7-day motorhome holiday exploring Northland, which will tick the box for doing a few things I’ve not done before, as I’ve not been north of Matauri Bay (and it was a brief, brief visit) . . . friends and family will have to wait.

Industry hungry for tech-savvy EIT graduates

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EIT’s Schools of Business & Computing are ready to kick off a new term, now accepting enrolments for the Master of Digital Business, the Postgraduate Diploma in Digital Business as well as the Postgraduate Certificate in Digital Business. These programmes are delivered at both Hawke’s Bay and Auckland campuses and have been a major draw card for students since their premiere in February this year.

“Graduates of these programmes will be able to harness digital technologies, manage technology for businesses and improve digital transformation for organisations. The demand for tech- savvy managers has never been greater,” says Dr Sabine Hoffmann, Head of School for both Business and Computing.

Courses cover topics such as data analytics, e-commerce and e-business, digital marketing, digital entrepreneurship and innovation and management of emerging technologies.

Sabine Hoffmann says, “The employability of graduates is our number one focus. With their advanced digital skills, graduates will meet the growing demand for digital know-how and will be highly sought-after in the job-market.”

Lately, the schools have added other cutting-edge qualifications to their portfolio responding to the increased demand from industry. The Master of Logistics and Supply Chain Management, the Postgraduate Certificate in Logistics and Supply Chain Management as well as the Postgraduate Diploma in Logistics and Supply Chain Management are designed for working professionals who want to advance their expertise and keep up to date with a fast-evolving industry.

All these programmes share some courses to enable students to move across disciplines in business and computing and craft a study plan to suit their professional pathway. At the end of the day, it all comes down to job relevance.

Well-trained employees are the backbone of New Zealand’s economy.

The school is also dedicated to connect their students with local businesses – a win-win-situation for students and industry alike. Dr Tom Hartley, senior lecturer at EIT’s School of Computing, for instance is in the process of developing a student-run International Student Business Hub (ISBH).

Expecting to roll out in August this year, the programme plans to support Hawke’s Bay’s international business community by bringing them together with EIT’s bright international business and computing students.

Tom will be working alongside Associate Professor Jonathan Sibley and others on a research project to investigate the advantages that the programme will provide for EIT’s international students and how the programme could link our domestic businesses with international commerce.

Sabine says, “Engaging with EIT’s highly-skilled international students will enable local businesses to connect to the world. And these connections are what EIT values, fosters and continues to create.”

The value of volume

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The COVID-19 pandemic is a significant event.

So ….. where to from here? If I had a dollar for each time I was asked what affect this will have on future property values I could probably retire. Possibly, the more important question should be: What is the impact going to be on volume? Answering this question will probably give a more informed prognosis because in time it will have a more material impact on property values.

‘Alert Level 4’ saw the sudden shutdown of all non-essential business and it is well recognised that operating in this environment has had a major impact on the national and local economy. Much of the modelling regarding the economic impacts and subsequent recovery are based on data from the Global Financial Crisis (GFC). However, even the GFC did not, all but suspend sales transactions so it’s safe to say the property market has had a very big shock. How market uncertainty is managed both in the property sector and more generally in the wider economy will play a big role in recovery.

The lowering of alert levels has allowed real estate agents to operate and we are starting to see an increase in property transactions as the market reactivates. Transactions post ‘Alert level 4’ to date indicate a levelling in values. However, there is still a way to go and the full impacts to the economy may only become evident in the next 6-12 months. The Government, Reserve Bank and Retail Banks have implemented a multitude of assistance packages to soften the blow and help stimulate economic activity. This may help hold immediate value levels, however; all indicators are that we can expect the impacts to be negative as the furlough packages are removed.

Most of the sales data that has transacted through ‘Alert Level 4 and 3’ was negotiated prior to going into ‘Level 4’ lockdown. Consequently, the property market post COVID-19 is in unchartered territory and property market dynamics as we have known them have been rendered obsolete. At the time of writing this article there was not yet a full month’s worth of data of sales transactions. Therefore, we are not able to fully analyse the impact of COVID-19 on property values. The REINZ data for April shows a substantial reduction of 83% in volume of transactions and the record median sale price was clearly influenced by a small volume and weighting of transactions in the higher price bracket. This is not surprising due to the sales transactions being stalled and most regions (bar one) recording their lowest volume of sales transactions since records began.

Currently property agents have reported there being good activity with strong buyer demand, and multiple offers still being presented to vendors. While we are not privy to consideration levels, transactions that have been reported are at comparable value levels to those that would have been expected prior to 25 March. However, business survival and subsequent job losses will have a significant impact on market sentiment, and it is highly likely that any falls in value may not transpire for some time yet.

To assist in quantifying what impact the COVID-19 crisis might have on residential property values we have looked at the impact the Global Financial Crisis (GFC) had on the residential property market.

Internationally the fallout from the GFC was seen in 2007 but locally we did not see the impact on our market until 2008 showing a reduction of 2.36% in our median sale price (MSP) from the 2007 year. Of more significance, was the impact to the volume of transactions, which dropped from around circa 3,700 sales per annum prior to the GFC to circa 2,100 per annum post GFC, a reduction of some 43%.

Economists and expert commentators are suggesting the full economic impact of COVID-19 will be worse than the GFC with unemployment rising to somewhere between 8% to 11%. This is when we will see a material impact on residential property values with most predicting a drop of somewhere between 5% to 15%.

Where there is likely to be an immediate impact is in the volume of sales transactions and days to sell. Ultimately, we have a more positive outlook for our local market than the economists and estimate up to a 5% reduction in value and up to a 40% reduction in volume. Some predict a bigger reduction in volume; however, we are starting from a lower volume of transactions pre GFC.

Indeed, interesting times ahead.

Get your investments right from the start

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This article was written in early May.

In the last issue of the Profit, I used the term “market correction”, and boy oh boy, did we have one of those! Not for a second am I claiming a prediction of Covid-19 and the effect on the markets, but I will state that now more than ever real relationships with our clients are paramount.  Also, it’s important to do your homework on your investments before black swan events take place; we’ve now had two in the last 15 years.

But before we talk about that, let me say that I really feel for the businesses of Hawke’s Bay, many owned and operated by people whom I know personally, and the impact that Covid-19 is having.  New Zealand and to an extent Hawke’s Bay, as primary producing economies, will feel the effects of Covid-19 for some time to come.  Stimulus packages have tried to target employment retention and cash flow concerns but the real economy, effectively the flow of non-monetary factors, will struggle to get back to full pace in a short time.  I feel the real effects of Covid-19 are yet to be realised.

Thankfully, at Midlands our relatively vanilla offering to our conservative investors means that we have not experienced the volatility of other sectors – our strength is based on the quality of our lending book and the liquidity and management practices we have in place.  Sure, we’ve had to work with some borrowers regarding their debt serving abilities, but so far this has been done without any material adverse effect on the performance of the fund.  Being diversified around the country and having low Lending to Value Ratios (LVRs) has helped that profile.

Investors trust Midlands to give them a consistent and conservative return, over and above main bank rates.  They do not invest with Midlands with the intention of significant volatility.  But volatility is what investors got in many other sectors, including multi-sector solutions such as KiwiSaver.

I have written at length in the past about factors such as liquidity, volatility and getting an asset allocation that meets your needs and goals when looking to invest.  There is considerable material available in investment documents, such as Product Disclosure Statements (PDS), that assist in making these decisions. Your total asset allocation (all your investments) should be based on your needs, not just in fair weather, but over time and reviewed accordingly.  Past returns should be balanced with defensive factors, diversification of assets, when and if income is distributed etc.

So, I read with bemusement (and great worry) that many KiwiSaver investors switched to conservative or income funds when Covid-19 had violent effects on the market, mainly in late March and early April.  There is enough literature to say that financial professionals cannot time markets effectively, let alone the layman. So why do it? If you do not trust the manager of your funds to navigate what they can within their investment mandates, I would suggest you have chosen the wrong manager. Already we have seen markets correct back considerably meaning that those who switched have crystallised losses and have missed the considerable “bounce”.

I fear that Gen X and Gen Y will bear the main burden of the fiscal stimulus packages of Covid-19 for years to come, via taxation, estate duties (from the boomer generation), means testing of superannuation and many other vehicles yet to materialise. They should not be burning their long term nest eggs with poor investment and asset allocation decisions as well.

There are many factors that determine what you should invest in, especially in KiwiSaver as a “long” investment.  But time is one of the most vital considerations.  If you do not have the stomach for volatility, nor the time, then a more balanced or conservative type fund is more appropriate from the outset, not after the fact.

Remote work is here to stay, and will be transformational

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How did you cope with seeing computers, keyboards, screens and staff walk out the door on 26th March, wondering whether this remote worker experiment would actually work?

What we witnessed was the future being sucked forward in a vacuum of necessity created by the COVID-19 pandemic lockdown.

Whether you were well prepared or not, remote working as an option is the new reality for many businesses here and around the world.

It is now important to reflect on what this all means and how a remote enabled workforce can add value to our business and organisation, and what technology you’ll need to make it happen.

Remote Work Benefits

Remote working provides the opportunity to reassess existing technology, systems and operational processes that can provide employees with a workplace promoting engagement, diversity, and wellness. This is likely to elevate productivity and performance across the board.

In essence, if you establish a pragmatic work-from-home protocol, you will need to be closer to your workforce than ever before. Nowhere to hide for leaders and employees alike, unlocking potential and giving you a competitive edge.

Being able to tap into a remote work talent pool not restrained geographically can address access to new skills and create new job roles within your organisation. That said, remote work may not be ideal for every business, but it gives many a chance to rethink team diversity and dynamics and the necessary expertise to drive success

The Right Technology and Processes

Business leaders will need to implement the proper businesses tools and software, and managers must put in the right processes. Here are some ideas to help with some of the challenges you will need to address.

One of the most recognised reasons for remote team challenges and failures is poor communication. Good internal communication is the life blood of a great business culture. Without the right tools to facilitate real-time communication, teams will not interact as often or meaningfully, and employees could feel more isolated.

But when teams leverage collaborative tools such as Microsoft Teams, Google Hangouts, Slack, Zoho, and ZOOM, they create transparency and sharing in real-time which results in better accountability, morale and productivity. Key toolset features include instant messaging, video conferencing, voice notes, and document management.

Collaboration

Over 60 percent of teams say collaboration is the most important ingredient of business success. Today’s collaboration software empowers teams to work smarter together whether in the office, in a remote work centre (outsourcing) or at home.

These tools provide real-time delivery and deployment of information as well as instant, reliable and secure access to company data and information whenever and wherever the teams need it. Many of these software tools are available and at no additional cost as part of your Microsoft or Google accounts feature sets.

These virtual work spaces will continue to evolve and can play a critical part in the success of your business. It does this by keeping work organised, prioritised while ensuring teams are always online and co-ordinated.

Team Messaging

Facilitates real-time, one on one and team messaging technology has emerged as the primary means of communication for remote teams. They’ll have the ability to send and receive messages instantly, providing secure access to people and information that email and social media apps cannot.

Video Conferencing (VC)

Communicating face-to face from just about anywhere and anytime, from work, the airport, in the orchard or in a taxi. The VC tool must allow for screen-sharing and recording so participants can share important insights with the rest of the team on any device they choose.

File Sharing

File sharing apps makes available all of your important files and documents via the cloud and sync them across all your device and teams. The same security protocols apply to your users whether in the office or at home, so your data is safe, and access can be audited.

Many of the software tools to achieve a permanent migration to a remote work reality for your organisation are readily accessible, are easy to deploy, are secure, deliver instant results and are easily deployed, if you know how.

Over recent months, many of us have been thrust into a remote work environment, and it looks like this concept is here to stay, largely driven through necessity and the safety of our workforce. But also, the benefits of remote work have been well and truly realised, and can be a powerful tool for organisations going forward.

Business after Covid19 – our new normal

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The COVID-19 pandemic will in all likelihood change the way that we do business for a long time to come.For most businesses’ turnover is down and owners are having to turn their attention to dealing with an environment that is constantly changing during this time of uncertainty, their inventory requirements (especially those who are reliant on the import & export markets or have only just begun to trade again) and their staffing capacity. Maintaining profitability, or in some cases viability and liquidity, could prove to be challenging. Below is a brief overview of some key elements you should keep in mind to help facilitate your businesses likelihood of success.

Short-Term Cash flow Forecast

Prepare a 13-week cash flow forecast. This is often an eye- opening exercise and will effectively capture most entities’ business cycles. The forecast will help navigate choppy waters in the near-term, as it will highlight shortfalls in necessary cash balances. Maintaining an up to date forecast will allow you to easily identify if there is an upcoming risk of the business running out of cash and/or will show if borrowing requirements fall short of actual availability from lines of credit. You will need to ensure that any forecast is subject to revisions in light of COVID-19 and the ongoing impact it will have on the market. Cash flow forecasting is a necessary tool for distressed businesses and can be helpful for entities going through a rough patch or for stronger businesses struggling in this economy. Being in a position to be able to identify when cash may be short, puts you on the front foot for being able to make arrangements to source more capital or to organise payment arrangements i.e. contact with your bank for extended loan facilities, contact with Inland Revenue to arrange payment plans and liaise with landlords to determine whether a rent relief period is feasible.

Monitor actual against your forecast

Cash is King! It is possible that a business can still be reporting profits but have trouble meeting its current obligations to both lenders and key creditors. Problems may develop as customers become slower to pay or, in some instances, don’t pay at all. Some problems may not be immediately recognised and could include changes in product/service demands, increasing overhead costs, use of obsolete production methods or increasing competition. As a starting point review, defer and/ or eliminate all non-essential expenses and capital projects, where possible. Identify whether there are any current commitments that can be put on hold or adjusted given the current environment. Further, accelerate receivable collections, focus on customers that normally pay on time and have started to slow payments; offer discounts to pay now; even keep on top of small accounts.

Adaptive management – learning by doing

When faced with great uncertainty, we have three options:- remove the uncertainty and proceed, proceed anyway and adjust as necessary, or do nothing. If we assume that option 1 is unrealistic, and option 3 is unacceptable, we’re left with only one option – take action, learn, and adapt. The very objective of adaptive management is to provide a framework that drives action now, despite uncertainty. The goal is not necessarily a predetermined target – at least not initially – it’s achieving incremental change. The idea is to take a small step, reflect, learn, adjust, and take another small step instead of large strides that may well lead you off course when dealing with moving targets.

Adaptation goes past simply responding to disruptive events; it also means seeking out and seizing opportunities that are created by market forces. At times like this, it’s this sort of iterative decision making that should be the foundation of your strategic planning.

Short-term action plan

The potential output of a short term action plan would be a succinct, “fit-for-purpose” plan that prioritises the what, who and when for your organisation and can be used as a roadmap for the upcoming months. It can also be used as a key discussion document for sharing with your business’ stakeholders.

The following areas should be noted within your action plan:

  • Ensure you understand the current Government rules and requirements for your business
  • What can I be doing now to prepare? What do I know for certain?
  • Determine short term goals
  • SWOT analysis
  • Overall solvency
  • Working capital needs
  • Operational – supply chain continuity, logistics
  • Customers and sales
  • HR, Employment issues and structure of the business
  • Finance and funding – what Information would be required to get funding (cashflows, plans etc)