Last month, the UK signed a reciprocal agreement with New Zealand that allows both countries to use each other not only as export destinations but also as platforms from where each can continue to export.The bi-lateral agreement focuses on four main areas, increasing co-operation in: inward investment; trade; collaboration in third markets; and the sharing of best practice. So what should UK SMEs consider when trading with New Zealand
- Research: Before you begin trading with New Zealand, find out everything you can about the market. For example, while the majority of New Zealand’s population can speak English, 4.1 per cent speak Mu0101ori and 3.2 per cent speak Samoan. Getting something as fundamental as your trading partners” native tongue wrong can lead to a number of unnecessary communication issues.
- Customs and regulation: these can make or break your exporting business so make sure you understand the rules and requirements from the outset. For example, the import of children’s nightwear, toys and even crayons to New Zealand are restricted to control the importation of unsafe goods and toxic substances.
- Plan: Given the sheer scale of the nation, establishing an efficient route to market is crucial. Wellington is the capital city of New Zealand and, in addition to holding the seat of government, it also has its own major port, making it an ideal gateway for trade. However, if considering trading with Christchurch, be aware that the city is currently undergoing a significant rebuilding programme following the earthquake in February 2011, which could affect this route to market.
- Finance: Latest quarterly economic figures from New Zealand show improvement despite the growing financial crisis. New Zealand’s GDP for Q2 recorded a 0.1 per cent increase (with consumer spending increasing by 0.3 per cent). Assessing your target market’s current exchange rate against the pound is another important consideration when initiating an international trading relationship. The New Zealand dollar is currently stronger than the pound, providing an additional opportunity for UK exporters to boost profits through trading in this market.
- Seek help: As New Zealand’s fifth largest trading partner, there’s a great deal of advice out there for UK businesses looking to export to New Zealand for the first time. For tailored advice, try DHL Express, UKTI or the New Zealand Customs Service.
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