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Why Kiwi ingenuity is choking NZ Inc

Firstly, let’s be clear – our culture has grown from Kiwi improvisation, not Kiwi ingenuity. Improvisation, according to dictionary.com is ‘To make, provide, or arrange from whatever materials are readily available’. Number eight wire, the Taranaki gate, what fantastic examples of kiwi improvisation, not Kiwi ingenuity.

Our colonial roots, with our isolation and inability to source the correct tools or resources, made us masters of improvisation – and we have proudly built a successful, commodity-based economy based around low cost and making do. To succeed in today’s globalised marketplace you must either have your unique selling point (value based) or be the cheapest (commodity based).

With the exception of our ability to make dairy ingredients economically off cows grazing our lush paddocks and lots of water, I can think of few other examples of where being cheapest in the market is an option with our small domestic market and geographic isolation.

And why would we want to be a commodity producer? In the food sector/primary produce, New Zealand can arguably feed between 30 million and 40 million mouths. This is under 0.5 percent of the 7.14 billion people estimated by the US Census Bureau to be on the planet.

We all know and pay lip service to the fact we should be selling value to the wealthiest consumers on the planet. We can only feed 0.5 percent of the population and as we have the cleanest food on the planet extracting value from this and feeding discerning people is the obvious strategy for the betterment of New Zealand companies – and NZ Inc.

So what is the issue? As a nation we revere those who can improvise or make something out of nothing. Being a jack of all trades makes you a good, practical bloke. No need to buy a new one when she’ll be right with a sledge hammer and a bit of number eight wire. This attitude has made it through to our modern day urban blokes.

Our give it a go attitude means we are great at starting up businesses and have loads of SMEs out there doing well. We do, however, let ourselves down when it comes to turning these $10 million businesses into $100 million businesses and beyond.

Why? Under capitilised, not wanting to reduce shareholding, lack of effective or formal governance? How about reliance on the founder (if you want it done properly, you’ve got to do the bloody job yourself) as opposed to processes and systems that allow scaling?

We have so few Jeremy Moons or Geoff Ross’s out there because we are satisfied with she’ll be right as opposed to setting up a team where all the barriers are removed and reasons to fail are removed. I have huge respect for these guys – their vision and tenacity is inspiring.

They don’t accept the status quo and they insist on value-based models while all the nay-sayers give the reasons something won’t work. This is especially so when it comes to investing in a brand. It’s easy to invest in bricks and mortar but takes courage to invest in story telling and plane tickets – yet this is where the real prize is for the brave.

I remember what a different feeling it was when Old Mout Cider was not under-resourced. All key staff were in place, we had good marketing budgets and we had no excuses to not succeed – actually a lot of pressure and quite frightening to remove all the excuses – but the rewards followed. So let’s not offer ‘things’ to the discerning 0.5 percent of the population we can feed, let’s understand our customers needs and demands and offer them real value propositions.

How are you going to play your part in stepping above Kiwi ingenuity and transforming us into a value-based export economy?

Scottie Chapman spent 13 years living and working in Asia before returning to New Zealand in 2005 to purchase Redwood Cellars (Old Mout Cider) with his business partner. In 2012 this business was sold to DB Breweries, allowing him to establish his niche consulting business SLC Group, which advises and invests in SME agribusiness and FMCG companies with potential to grow in niches in Asia.

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