Exporting to New Zealand
Strong foundations for business
New Zealand has stable institutions and good governance. The World Bank rates it number 1 out of 190 countries for ease of doing business (World Bank, 2019). Pro-competition regulation, an efficient tax regime, an open political system and investment in innovation have all contributed to an efficient and competitive economy.
Similarities to the UK
The UK and New Zealand share a common language and culture, as well as business and legal practices such as intellectual property (IP) protection and the rule of law. This makes it a relatively easy place for British companies to do business.
Ideal test market
New Zealand is a highly educated, wealthy and tech-savvy market with a population of almost 5 million people, including over 250,000 people who were born in the UK (Stats NZ, 2013 Census). It’s the ideal place to test and develop new products or services. Around half of the total population live in New Zealand’s 3 major cities of Auckland, Wellington and Christchurch (Stats NZ, 2018). This makes it easy to prioritise where to do market research of your product or service.
Ease of doing business
1st
out of 190 countries (World Bank, 2019)
Currency
New Zealand dollar
Business language
English
GDP per capita
$41,260
UK is $42,560 (IMF, 2018)
Economic growth
3%
(IMF, 2018)
Time zone
GMT +12
Opportunities for exporters
There are opportunities for UK companies across a broad range of industries. Our trade advisers in New Zealand have identified particular opportunities for UK businesses in the following sectors.
-
Infrastructure
New Zealand is investing heavily to update and create new critical infrastructure to cope with increased demand. An estimated $129 billion is expected to be spent on capital projects between 2019 and 2029 (New Zealand Treasury, 2019). There are opportunities for UK businesses.
Demand for UK expertise in rail infrastructure
New Zealand’s planned metro and rapid rail projects mean that there is demand in areas of UK expertise. This includes demand for products and services in consulting, engineering design, system and power engineering, signalling, digital systems, construction equipment, operational products and project management.
Demand for UK expertise in urban development and construction
Demand is being created by investment in housing projects and urban development to cope with population growth. There is demand in areas of UK expertise such as urban planning, architecture and design, consulting, construction, project management, engineering, and building material supplies.
Demand for UK expertise in in water and wastewater infrastructure
There is an ongoing review to improve the regulation and supply arrangements of drinking water, wastewater and stormwater to support New Zealand’s prosperity, health, safety and environment. There is demand for UK expertise in the development of water and wastewater solutions. Approved projects include a new wastewater tunnel proposed to run between Western Springs and the Mangere wastewater treatment plant in Auckland.
-
Technology
Technology is New Zealand’s fastest growing industry (New Zealand Technology Industry Association, 2016). Telecommunications, computer and information services were the 3rd largest UK service export to New Zealand in the four quarters to the end of Q1 2019 (ONS, 2019).
Demand for new technologies
Digital transformation across government and industry is creating demand for new and emerging technologies to improve service delivery. There is demand for expertise in artificial intelligence, machine learning, big data and analytics, the internet of things, robotics, blockchain, cloud computing and cyber security services.
Ideal test market
New Zealand’s market size makes it an ideal place for new exporters, or technology companies looking to expand globally. It is a business-friendly environment and a good place to develop and test new technologies and features.
Thriving tech eco-system
New Zealand has a fast-growing technology ecosystem with collaboration across industry, business, education and government. There is a healthy environment for start-ups. This makes it an attractive destination for UK tech companies seeking to sell their services or form partnerships with New Zealand companies.
-
Fintech
Fintech is a key growth area for New Zealand’s economy. It was the fastest growing technology sector, at 33.2%, in 2018 (The Investor’s Guide to the New Zealand Technology Sector, 2018). New Zealand has a flexible regulatory system that is favourable to innovators and investors. There is an opportunity for UK firms to take advantage of increased demand for fintech services.
Supportive fintech community
Industry body Fintech New Zealand has a proactive presence championing global links and collaboration. UK companies Revolut, GoCardless and Futrli are three UK fintechs already successfully doing business in New Zealand. All have established a presence at co-working space Rewired, in Auckland. The Kiwibank FinTech Accelerator is also an opportunity for UK fintechs interested in in New Zealand.
Demand for UK expertise
There is recognition of the UK as a world-leading fintech hub, which pioneers innovation in the financial services sector. With New Zealand moving towards an open banking regime and adapting regulation to drive innovation, there will be increasing demand for UK expertise.
Ideal test market
New Zealand’s market size makes it an ideal place for new exporters and fintechs who want to expand globally. It is a business-friendly environment and a good place to develop and test new technologies and features.
-
Agri-technology
Agriculture is a major industry in New Zealand. A focus on agricultural innovation to improve productivity means there is strong demand for agri-technologies.
Digital disruption
There is strong growth potential and opportunities for UK agri-tech companies across the supply chain, especially those using new and emerging technologies to drive production and processing efficiencies.
Demand for UK expertise
Increasingly, New Zealand companies are seeking expertise across the agricultural value chain. This includes seeds and grains, animal genetics, quality control, farm assurance systems and farm equipment and technology. This represents a significant opportunity for UK companies.
-
E-commerce
Online spending in New Zealand is on the rise, due to faster broadband speeds and more secure payment options. Trading platform Trade Me dominates the e-commerce sector with almost 4.7 million member accounts (August, 2019).
Ready pool of online buyers
The majority of New Zealand consumers are now shopping online. In 2017, New Zealanders spent approximately $10 billion buying products online, an increase of 9% (Nielsen, 2019).
New e-marketplaces
New marketplaces are opening up further opportunities for e-commerce sales into New Zealand. The marketplace TradeMe is well established, with 4.7 million member accounts. New Zealand's leading retail group, The Warehouse, launched an e-commerce marketplace called 'TheMarket' in 2019.
Time zone and season
New Zealand is the perfect complement to exporters based in the UK, enabling them to take advantage of the opposite time zone and opposite seasons to maximise sales of products 24/7, all year round.
Doing business in New Zealand
Preparing to export
VAT
Goods and Services Tax (GST) is a tax on most goods and services in New Zealand. The current GST rate is 15%. Learn more about GST on the New Zealand government website.
Import duties
All goods imported into New Zealand for business or commercial purposes are liable for customs duty, GST and other applicable fees. Indicative rates can be found in the Working Tariff Document of New Zealand. The Customs NZ website explains how the charges are calculated.
Standards and technical regulations
All products sold in New Zealand must be safe. There are two key laws that deal with product safety:
- The Consumer Guarantees Act, which gives minimum standards of quality for goods and services
- The Fair Trading Act, which promotes product safety
Importers must ensure products meet the minimum standards for the products to be allowed to enter the country. You can check the required standards at Standards New Zealand.
Labelling requirements
Packaging must meet New Zealand consumer health and environmental legislation. There are specific labelling requirements for:
- chemical products
- cosmetics
- electronic goods
- foodstuffs
- most therapeutic products
All labelling must use the metric system. You can read guidance on food labelling from Food Standards Australia New Zealand (FSANZ).
Payment terms
Payment terms and method should be set out in your contract and must be factored into prices. For business-to-business transactions these can range from immediate payments on receipt of goods (often with a negotiated small discount) to a negotiated 60-day payment.
Intellectual property
The Intellectual Property Office of New Zealand (IPONZ) is the government agency responsible for granting and registering intellectual property.
Copyright protection automatically applies in New Zealand from the date of creation. Patents and trademarks only provide protection within New Zealand.
Operating in New Zealand
Business culture
In general, business etiquette is very similar to the UK. Face-to-face meetings can be very important to develop business relationships and prompt replies to enquires are recommended. Visits should be planned in advance – ideally at least 4 weeks.
Punctuality is very important. New Zealanders tend to be informal in their business interactions. First-name terms tend to be the norm in most business situations. Directness and plain speaking are valued.
New Zealanders often take holidays during school holiday periods, especially over the New Zealand summer holiday period, which is January. As a result, visits during these times may not be productive.
Logistical challenges
New Zealand’s distance from the UK means you may face challenges in:
- travelling (at least 24 hours from the UK by plane)
- the time and money needed to ship or send goods
- the time difference (12 to 13 hours ahead of the UK)
Next steps
DIT can advise you on doing business abroad, and help put you in touch with other people who can help such as lawyers and distributors.
