MaryAnne Edwards

Maryanne Edwards, GMBA consultant talks to Jason Cooper, General Manager of Poly Flex Australia who celebrate 40 years in business, no mean feat for any business in today’s competitive environment.

Poly Flex is an Australian based manufacturer of a large range of anti-vibration engine mounting systems and couplings for the marine, industrial, agricultural, mining and power generation industries. Poly Flex now has over 1700 models capable of carrying weights from as little as 2kg up to over 4000kg per mount and a range of couplings to suit a large range of gearboxes not only used in the marine industry and many other industry sectors.

The company was started in 1981 by Brian Gagen, a true entrepreneur who clearly had a keen eye for product development and a talent for employing the right people. 50 percent of his staff have been with the company for over 10 years.

S

tarting Poly Flex is not Brian’s only claim to fame. He was an Australian household name in the hay days of rock-n-roll back in the 50’s and 60’s. An accomplished woodwind musician, especially as a saxophonist, he formed a group called The Planets. The band were regulars on the Saturday night TV shows of the time.

In recent years, with Brian stepping back from the business, the company has been driven by General Manager, Jason Cooper and alongside Brian’s daughter Administration Manager Tracey Gagen, is set to be the driving force behind Poly Flex into the future.  Jason’s son Jesse, an impressive young man, is now taking greater responsibilities as a sales representative within the business and wife Tanya supports Tracey in the administration area. As Brian has mentioned it is important for every family business to have a succession plan and if you can keep it in the family, you are more assured of the culture and heart of the business continuing.

Poly Flex has always had a strong push to develop their export market and to this end they have been regular exhibitors at METS, IBEX, Workboat World, Asia Pacific Maritime and many other international and domestic shows over the past 40 years.  Their international efforts have led to Poly Flex’s significant distributor and client base, with Jason Cooper reporting, “There are not many countries we have not exported to over the past 10 years extending as far afield as Iceland.”

Jason emphasised Poly Flex is always looking at design features and improvements commenting,  “In the past 24 months we have upgraded our CNC Mill, CNC Lathe, and our CNC program to the latest technology giving us greater capability and production capacity. We have introduced a Laser machine and purchased a Semi CNC Lathe and new smaller lathes.  To accommodate the new machines, we have also extended the factory and made a new linishing room. Effectively we have executed our plan to keep moving with the times, ensuring a programme of continuous improvement, consolidating our position as a long-term successful manufacturer in Australia.”

Many sectors of the global marine industry have thrived over the past 18 months particularly in the boat building and refit sectors.  Being a supplier to this sector and to the commercial sector has meant business for Poly Flex has not slowed down.  Whilst covid restrictions affected many businesses in terms of staffing it has given Poly Flex the opportunity to review production schedules, staff hours and shifts leading now to most staff working longer hours over 4 days and having 3-day weekends.  This is seen by staff as a significant benefit and has led to improved productivity and greater flexibility for the business.

With borders closed and travel restrictions still in place the Poly Flex team cannot travel to international shows or to visit customers. However, the use of social media, liaising with existing customers, being kept informed on industry trends via online media news and forums, has seen their business continue to grow through this period.

When asked about their marketing strategy going forward Jason said, “We are excited to be exhibiting in person at the Sanctuary Cove International Boat Show this month and will have a presence also at the Sydney International Boat Show at the end of July.  When we can travel internationally again obviously METS/IBEX etc will be on our radar. We always exhibit where we can under the AIMEX umbrella in the Australian pavilion.   We do miss the personal interaction and social side of our industry so SCIBS and the ASMEX conference is exciting to look forward to.

To stay abreast of the times Poly Flex have kept up with the latest technology which has allowed increased production capacity, reduced production timeframes, improved cost efficiencies and ensured excellent quality standards.  All are key ingredients to thrive and survive as a successful manufacturing business on the global stage.

When asked about the keys to Poly Flex ongoing success, Jason stated, “Quality product and design, reliability, good customer service, fast response times, innovative design, and the ability to modify/customize product to meet our customer’s needs. Our team are all very focused around the customer and delivering on their needs and requirements.”

Exporting in today’s environment is extremely competitive and as Brian Gagen once told me his biggest competitor was imports.  With sovereign capability at the fore of government thinking and many companies both domestically and globally reviewing their supply chains, there are still many opportunities on offer for Australian businesses.  Companies that can react quickly, have strong manufacturing capacity and capability and build strong customer relationships are doing well and congratulations have to go to 40 year old family owned and operated Poly Flex a company that embodies the ANZAC spirit and has built a well-deserved reputation as an established global exporter on the world stage.

For further information
Maryanne Edwards
Email: medwards@gmba.blue or info@gmba.blue
Mobile:+61412916036
Website: www.gmba.blue

Disclaimer: Global Marine Business Advisors and its associated website www.gmba.blue are not registered legal entities. GMBA is a network of independent marine industry advisors.

Maryanne Edwards, GMBA Consultant, talks to Clint Jones a New Zealand Marine Industry personality about his thoughts on the current state of the New Zealand Industry. 10 years ago, Clint was appointed skipper of the Camera Boat for the 2011 – 13 Americas Cup, including all of the World Series events sailed in many locations around the World, using the AC 45’s. He has since been involved with the Americas Cup in Bermuda, the Olympics in Rio in 2016, and Sail GP.

Upon returning to NZ in 2014, Clint was offered the role as MD of a small marine export company – Propspeed, a silicon foul release coating for propellers. Clint started with a team of 3 growing to a team of 26, including 5 in the USA, 3 in Europe and distribution facilities in Florida and The Netherlands. The company has won several Export Awards and Vendor of the Year Awards from their largest customer in the USA, West Marine. Propspeed is now exported to over 35 countries around the world and is seen as a leading brand in this market. Clint was recently elected President of the NZ Marine Export Board and is current President of Development at Propspeed International.

Question 1.
WHAT ARE THE MARKET FORCES IN NEW ZEALAND DRIVING BOAT SALES AND HOW IS THE MARINE INDUSTRY FARING OVERALL?

Response:
Our borders remain closed for international travel and this of course tends to focus people on their domestic market activities. NZ has seen a significant increase in boat sales both of locally built boats and imported (mostly from Australia and Europe) in the period July 2020 to March 2021.
This is put down to several reasons including a catch up on reduced sales from the COVID-19 strict lock down in NZ, when people were restricted to their one home bubble and shops and factories were shut except for petrol stations and food supermarkets and sales of boats dropped 90%.
House prices have increased by 20% in 2020 over 2019 providing confidence and additional equity for homeowners to borrow against to buy a boat.
Interest rates for house mortgages have dropped to a 70 year low of 2% and many homeowners have freed up weekly cash that can be used to finance a boat.
Interest rates for boat (and car) purchases have dropped 40% to approximately 8%
The Prada Challenger and America’s Cup, Series held November 2020 to March 2021 in Auckland NZ has seen an increase in interest in sailing and water sports nationwide. Yacht and fishing club memberships are on the increase and many people have purchased or refitted their boat to view the 36th America’s Cup from the water. Over 1000 boats were on the Hauraki Gulf in Auckland watching the Prada Cup final in late Feb where Luna Rossa of Italy as beat INEOS of Gt Britain – Luna Rossa now challenge Emirates Team NZ for the America’s Cup in March 2021.

NZ has seen a decrease in visiting yachts and subsequently the marine businesses that service this sector of the industry have suffered a reduction in business in the period April 2020 to March 2021. In a normal year we would expect approximate 50 superyachts to visit NZ and have maintenance and refit work done whilst here. Due to our closed border this number has decreased by 50% to 25 and the yachts allowed into the country have had to obtain a special exemption under a process that the NZ Marine Industry Association negotiated with the NZ Government. In addition to superyachts, we would expect approximately 500 cruising yachts of 10 to 24m in length to visit NZ in a normal year and this has reduced to 60 over the same period above.

Given the attraction of the America’s Cup there were 160 superyachts on their way to NZ in 2020/21 but as referred above only 25 made it to NZ and of the expected 600 cruising yachts only 60 made it to NZ due to the closed border -So the opportunity lost here was and is enormous, not only for NZ but for other South Pacific countries where the yachts would visit on their way to and from NZ.

Question 2.
WHAT ARE THE CRUCIAL ISSUES MOST BUSINESSES IN NZ ARE ADDRESSING TO ENSURE SURVIVAL AND SUCCESS?

Response:
As we are an export driven company, delivering a marine product to 35 countries around the world, the biggest challenge for us has been how we maintain ongoing relationships and support to our distributors. So much of our pre COVID-19 business was strongly driven by personal visits, boat show representation and support of the local distributor, plus the ongoing in market training and support of their field sales team. We have been forced to design a whole new way of doing business, strongly using Zoom to now be our channel to relationship management and training. We have backed this up with a redesign of our website, video application training and digital platform upgrades. We have also looked to launch some new products and build a wider distributor network.

Question 3.
HAS THERE BEEN A NOTABLE CHANGE SINCE COVID IN SUPPLY CHAINS FOR NZ MARINE INDUSTRY BUSINESSES WITH A MOVE TO SOURCE MORE LOCALLY?

Response:
We import raw materials, but already use local suppliers wherever we can. We then turn these products into the export product that makes up 90% of our total business. We have been touched by supply chain issues. This has flowed onto hold ups to our Export orders, made more difficult by port hold ups, a reduction in some shipping timetables, and a massive spike in both shipping and sea freight costs. This has caused disruption to deliveries to our customers world-wide. This forced us to take a positive look at improving our distribution and in 2020 opened our own distribution facilities in Florida and The Netherlands. We are just seeing the advantage of this decision, enabling faster delivery of bulk product into both of our largest markets

Question 4.
WHAT ROLE IS THE AMERICAS CUP CURRENTLY FULFILLING FOR NZ BUSINESSES

Response:
Due to my involvement with the Americas Cup for the last 10 years, the Cup, and the networks developed around the events, have been valuable for the NZ Marine Export industry. I think that the involvement by Team NZ in the Cup for the last 30 years has had a very positive effect on the flow on of business that comes out of this involvement, both practically with the boats and products the event needs, but also the cutting-edge technologies and skills that have developed. I also see the ‘credibility’ the event gives to NZ Marine industry businesses, though hard to value, has a positive effect on our industry.

The America’s Cup has provided a stimulus to the local boating market and the sport of sailing throughout NZ. This is evidenced by an increase in yacht club membership including young people and children getting into sailing for the first time. Also evidenced by a 4% increase in new boat trailer registrations in 2020 over 2019 and that is even after a very slow March to June 2020 due to the COVID-19 lockdown.

There were over 1000 spectator and support boats on the America’s Cup racecourse watching the English vs Italy in the Prada Challenger Final Series held in February in Auckland. With the America’s Cup Match starting on 6Th March we are likely see an even a larger flotilla of spectator boats as Emirates Team NZ endeavours to defend the cup against the CHALLENGER ‘Luna Rossa’ of Italy.

NZ Marine has successfully negotiated with the NZ Government to allow the 200 foreign flagged visiting yachts already in NZ, to stay longer in NZ and for foreign yachts with a booked in refit or repair of over $50,000 to be allowed into NZ. This has seen approximately 60 cruising yachts and 25 superyachts enter NZ over the last six months providing valued business for the local marine businesses.

We are privileged in NZ to be hosting -two superyacht regattas-the first in the world for nearly a year. The Mastercard Superyacht Regatta run by the Royal NZ Yacht Squadron in Auckland 24th to 27th Feb February 2021 and the NZ Millennium Cup being run in the Bay of Islands 28th to 31st March 2021 run by the NZ Marine Export Group.

Question 5.
ARE CONSUMERS STARTING TO BUY LARGER VESSELS, OR WITH COVID ARE CONSUMERS LOOKING TO SPEND MORE RECREATIONAL TIME WITH THEIR FAMILY ON A MANAGEABLE SCALE AND LOOKING AT SMALLER, EASIER TO MANAGE VESSELS?

Response:
The activity of boating has increased during our summer of December 2020 to March 2021. People who may have travelled overseas, but not allowed to due to covid, have purchased boats and are using them. This applies to small boats, jet skis to keel boats and large cruisers. The only restriction is the lack of marina berths (pens) or hard stand storage to keep the boats. NZ has over 60 manufacturers of trailer power boats and they supply 90% of NZ trailer power boat sales in NZ . Most of these manufacturers have full order books 6 to 12 months ahead and are struggling to keep up with the current demand. As a result our world acclaimed apprenticeship boat building program has seen a record number of registrations with over 500 trainees currently being trained through 220 companies nationwide.

Question 6
WHEN INTERNATIONAL BOAT SHOWS RESUME, WILL THEY BE AS IMPORTANT AS BEFORE?

Response:
I think there will be a close look at the previous costs and time spent by the industry attending international boat shows, and like all good business decisions a return on investment will be closely scrutinized. Having said that, we are people that like the interchange of personal relationships, and that missing off the current landscape will dilute some business relationships. If you have not done a good job in the current Zoom/Digital world, business will be lost, so a clever balance of both options going forward is how we see the future and attending events that generate results will be hard to miss. We are planning our own Auckland Boat Show to be held in the America’s Cup Viaduct Harbour area 7th to 10th October 2021 and this is eagerly being looked forward to by the 200 exhibiting companies.

For further information
Maryanne Edwards | GMBA-Australia/NZ
Email: medwards@gmba.blue
Mobile:+61412916036
Website: www.gmba.blue

Disclaimer: Global Marine Business Advisors and its associated website www.gmba.blue are not registered legal entities. GMBA is a network of independent marine industry advisors. In all articles the opinions expressed are those of the author and does not necessarily reflect those of GMBA

The key leaders of Australian and NZ’s marine sectors talk to MaryAnne Edwards GMBA consultant about current issues

January 2021

The Covid 19 pandemic has not daunted the fighting spirit of the New Zealand and Australian marine industry.  In talking to key leaders of the marine sector it is clear both countries are emerging from the pandemic strongly intact and ready for the flood gates to open.

The ANZAC values include such human qualities as courage, mateship, integrity, initiative, sacrifice, determination, ingenuity and these values are embodied within the Australian and NZ marine sectors.  It is these values that make doing business down under so attractive and has helped rank New Zealand and Australia in the top 15 of 190 Global countries for ease of doing business, in the top 5 for obtaining credit and in the top 8 for ease of starting a business. (Source World Bank  Group, Doing Business 2020)

It is well known a country’s reputation drives political, commercial and economic success. Businesses are selling their products and services to customers who may never have set foot in their country. These customers rely, in part, on the global reputation of a country to make their buying decisions. Currently both country’s reputations on the global stage are highly regarded not only for their handling of the Covid 19 pandemic but also due to the fact there is strong promotion of their marine sector capabilities by NZ Marine and the Australian International Marine Export Group.  Both trade organisations play a key role in the industry.  They continue to ensure global markets look their way when making buying decisions and this is currently reflected in the domestic and export success of their boat manufacturing, refit and repair sectors.

MaryAnne Edwards representing Global Marine Business Advisors interviewed the CEO’s of both AIMEX and NZ Marine talking about their views of the current environment in both countries

In NZ the key association for the recreational, superyacht and export sectors is NZ Marine headed up by Peter Busfield an experienced CEO who has managed the association for  many years. www,nzmarine.com

In Australia, the leading trade association for the export, superyacht and commercial sector is AIMEX and this is ably run by CEO David Good who came to the association nearly 3 years ago with considerable experience in the superyacht and commercial and defence industry. www.aimex.asn.au

It is confirmed a vaccine will be available in both countries this year and no doubt once the vaccines are available globally this could become a requirement when entering NZ & Australia but one expects a continued cautious approach will be taken to opening borders.

GLOBAL PERCEPTION

When asked about the global perception of Australia and NZ both CEO’s had a positive response.

David Good response;  “Yes, we have been stable and reliable. Not a single lost day in most manufacturing and refit yards. Not a single vessel or crew rotation turned away since the start of the covid 19 pandemic.  This should hold us in good stead for a long time to come.”

Peter Busfield equally enthusiastic responded; “ Yes there is currently a huge demand for international companies to move their offices/operations to NZ and it is likely that when the borders open there will be a huge demand particularly from high net worth tourists who will be able to afford the long and costly airline flights.”

SUPERYACHTS WELCOMED

Superyacht Australia and NZ Marine were successful in lobbying their governments to provide exemptions for vessels looking for a safe haven during Covid 19 providing a boom for repair and refit yards.

These exemptions applied to foreign flagged vessels and yachts entering the country. Given the world class trades people and significant clusters of marine industry companies NZ and Australia have been well equipped to service all international visiting vessels.

Both governments understand the economic benefit that visiting commercial vessels and yachts bring in, especially given the utilisation of the extensive supply chains that both countries have established to service the industry.

Peter Busfield responded; “We successfully negotiated with the NZ Government to provide border entry exemptions for visiting cruising and superyachts and commercial vessels that have prebooked in refit or repairs of at least $50,000 in value. This process is working and has seen over 30 yachts/vessels gain entry approval since August this year. This has sustained many marine businesses that otherwise would have closed their doors. In addition, 200 or more foreign flagged yachts/vessels yachts that are already in NZ that were meant to depart by May 2020 have been granted an exemption to stay in NZ until May 2021. Many of these yachts have had new maintenance/refits undertaken whilst ‘stranded’ in NZ – some of which are superyachts and owners and crew have been happy to stay put in NZ as we are being seen as a safe haven from Covid 19.”

David Good, responded; “ We have spent many hours lobbying both state and federal governments on behalf of the industry which has resulted in 32 vessels coming into Australia. Crew and owners arriving on the vessel can apply to have time in transit count towards quarantine and a decision is made by each state health authority. Their decision is based on a risk assessment of covid rates at previous ports, time since these ports and likelihood of undetected transmission onboard the vessel. PCR tests at previous ports assists in a more educated risk assessment. 27 of the last 33 vessels arriving into Australia have had time in transit recognised towards quarantine time.”

There have been no cases of Covid19 arriving into Australia via a Superyacht to date.
Superyacht Australia has also been processing applications for these vessels providing a very critical service for members.

SURGE IN BOAT SALES AND CHARTERING

Boat builders, members of both organisations, have also seen a surge in orders and have never been busier with many consumers now seeing boating as a safe, healthy and exciting alternative to international travel.  Key boat builders like Riviera and Maritimo in Australia and over 100 trailer power boat manufacturers and yacht builders in NZ have significant export orders as well as a strong increase in sales from local buyers.    The domestic charter market in Australia has also enjoyed greater interest as HNWI are unable to travel internationally and are looking for luxury family holidays.  In Australia the superyacht fleet has dramatically increased over the past 12 months with an estimated 70 Australian owned superyachts now based in Australia.

Peter Busfield responded; “We always said that international travel was our major competitor to recreational boating, we were right, as 2020 will go down as a year of two halves -no sales in lock down and record sales when out of lock down. Most boat builders /manufacturers have presold 6 months out to mid this year.  New Zealander’s are not wanting to leave NZ, why would they? We are basically covid free and if you return to NZ after going overseas you wait for a 2 month booking to go into Government 14 day isolation on return to NZ.”

David Good responded; “We have undertaken several marketing campaigns targeted at high end cruise industry customers promoting the unique, luxury and bespoke opportunity of chartering a superyacht in Australia.  It has been important to market this product in a way these cruise enthusiasts understand. We have encouraged members to market a charter at an all-inclusive price experience similar to what clients are used to when booking a high end cruise.”

It would appear this is good advice as in speaking with several HNWI they also confirm the concept of APA is not their preferred way to book holidays and an all-inclusive, no misunderstanding price point is more desirable.

GOVERNMENT SUPPORT

The NZ and Australian governments have responded positively to support businesses through these trying times with economic packages designed to allow businesses to keep their staff employed and the economy moving.

The governments’ response in both countries was quick and effective. This support ranged from wage subsidies for employees to allow businesses to retain staff, to cash flow boosts, deferral of mortgages, interest free loans and solid support for exporters by way of marketing cost reimbursements.  To take advantage of the wage subsidy initiative companies had to show a 30% decline in revenue which for most during the height of the pandemic was not difficult.

Government does not directly fund NZ Marine or AIMEX.  They are both in the main funded by membership subscription and events.

Peter Busfield responded;  “In NZ the government however does provide support for the NZ Marine and Composites Industry Training Organization for setting and arranging apprenticeship training and on a case by case basis occasional support for specific export events. The NZ government is very financially committed to the Americas Cup which highlights NZ as a superyacht and tourism destination and showcases the NZ Marine sector and its facilities.

David Good responded; “In Australia the federal and state governments provide support for specific events and initiatives with contested funding limits.  The Government also offers an export market development grant which provides a reimbursement mechanism for companies who spend dollars marketing their business internationally.  There are criteria for this and not everyone complies, but for those who do it provides a positive financial injection.  The Queensland state government stands out with its marine industry strategy providing strong support for the marine industry in their state. This strategy and the financial support behind it provides comfort to private investors which is currently reflected in the heavy investment many Qld companies are making in their boat building and refit facilities.”

The issue now of course is the transition away from government handouts to managing within the current trading environment.  The economic incentives were a bonus for ensuring the continued operation of the marine sector but in some industries it has been difficult getting everyone back to normal wages and work hours particularly tourism and hospitality.  In both countries there is a reliance on young international travellers who were able to  come and go regularly providing a much needed source of casual labour.  With borders locked down and no back packers coming into either country particularly in Australia there is a dearth of casual labour.

VIRTUAL SHOWS V’S THE REAL THING

During the height of Covid 19 both countries were forced to cancel their key boat shows.  First off was the cancellation of the Sanctuary Cove International Boat Show (SCIBS) in May, followed by the Hutchwico NZ Boat show in May, followed by Sydney International Boat Show (SIBS) in July and then the Auckland On Water Boat Show in October.

With covid restrictions easing in November, Sanctuary Cove held a smaller “Boating Festival” which whilst having to adhere to a number of covid restrictions was extremely well supported by industry and consumers and it is understood significant business was transacted.  It confirmed the industries need for face-to-face interactions and the connections that develop from this.

In May 2021 SCIBS and the Hutchwico NZ Boat show will be the first major Australasian  shows to go ahead followed by Sydney International Boat show at the end of July.   It is also exciting to hear the famous Tasmanian Wooden Boat Show will go ahead in February 2021.  The Auckland On Water Boat show in NZ is scheduled for Oct 2021.

Peter Busfield responded; “Having led our MIA team in cancelling eleven major domestic and internal events March to October 2020 we look forward to planning an event that actually takes place!”

A frustration shared I am sure with many overseas counterparts.

There has been a lot of discussions around the value of virtual shows and whether they filled the void left by cancellation of boat shows but the word from the top is No.  Companies still see the very real need for boat shows and the personal interaction and relationship building that comes with these.

David Good responded; “Companies with targeted marketing and online content have reported good enquiry and interest, but member feedback suggests the online shows themselves have not filled the gap.”

Peter Busfield concurred responding;  “We have not seen any value in virtual shows but do see value in companies increasing their own digital marketing and connecting with potential customers via social and digital  media.”

David Good further responded; “ The shift to online marketing has not replaced our plan to travel as soon as permitted. AIMEX will take the lead in international travel representing members at key international shows that may go ahead in 2021.  We may end up travelling more on behalf of members, with a group stand rather than individual stands.  Members may not wish to travel or take the vaccine initially.

HOW IMPORTANT IS THE AMERICAS CUP TO THE REGION.

The Americas cup (AC) is a huge boost for the entire Asia Pacific region.  Vessels that head down for the Cup will generally visit many South Pacific countries and tend to remain in the region for a minimum of 6 months.  Covid 19 has clearly changed the dynamics of the AC but all factors are pointing to an exciting event taking place as we have already seen with the Prada Cup.

The event will still be a boost for the region and Peter Busfield was pleased with the number of superyachts in NZ for the event.

Peter Busfield responded; ”The recently re-elected Labour Government is maintaining very strict border controls and only people with NZ passports can enter NZ. Everyone entering NZ must go into a government provided 14 day isolation period at a hotel directed by the Government. There is currently a 2-month waiting list for New Zealanders wanting to return to NZ due to restriction of isolation beds.  The America’s Cup event and some other major sporting events have exemptions where participants can gain an exemption to come to NZ but they must go into the Government provided 14 day isolation.

The pre America’s Cup World Series Christmas regatta started in December where the England, Italy, USA and NZ teams met on the race course for the first time. This highly anticipated event saw 75 foot monohulls on foils doing up to 50knots (93 kmh). The course is windward leeward, so it is traditional on the wind starts. For the first time in many years, the TV broadcasting is free to air worldwide and is likely to be the largest viewed sporting event after the Olympics in 2021. The Prada Challenge series currently running started 15^th January and goes until 24^th February 2021 with the winner facing Emirates Team NZ in the actual America’s Cup regatta starting March 6^th 2021.”

EVENTS COMING UP

When asked what key events were on the horizon for both organisations Peter Busfield talked about the New Zealand Millennium Cup.   A key event in the NZ Marine calendar.

Peter responded; “The NZ Millennium Cup is the largest superyacht regatta in the South Pacific.  We are excited given so many events have been cancelled that this popular event is going ahead in the beautiful Bay of Islands, with an expected 8 to 10 entries starting 15^th February 2021.

David Good responded; “Our next event is “The Superyacht Australia Soiree” scheduled for Feb 27^th 2021 at Jones Bay Wharf in Sydney. This year’s event is being held in partnership with one of the world’s largest manufacturer of superyachts, Benetti Yachts and will further build on last year’s success with an extended yacht-hop, followed by a VIP evening of luxury for guests and captains.”

SOVEREIGN CAPABILITY IS HIGH ON AGENDA FOR MANY COUNTRIES

Given the Covid-19 situation there is a strong push for greater sovereign capability particularly in Australia and many businesses given overseas industry shuts downs and freight issues have been forced to review their supply chains. Reliance on overseas countries to deliver critical products has been highlighted.   Maryanne asked both David and Peter about their industry’s’ view of this drive for greater sovereign capability.  Is it just talk with little in the way of support for manufacturers or are governments actually walking the talk?

David Good responded;  “The issue re sovereign capability has always been a key topic. There is a growing enthusiasm for Australia Made. Decisions to relook at the TT Line replacement has put a positive focus on this. The government indicated that given current and emerging economic problems caused by COVID-19, there needed to be more consideration of local content and manufacturing jobs in Tasmania and Australia as part of the overall vessel replacement project. The Australian government is certainly introducing initiatives to support local manufacturing and I imagine the government will definitely take a stronger look at our marine industry capabilities.”

NZ has always had a strong culture of buy NZ Made with the marine sector being a significant industry sector in the NZ economy.

Peter Busfield responded; “There is public and government talk about Buying NZ Made but most of our international trade agreements do not allow the government to mandate ‘Buy NZ Made.’ Having said that already 90% of trailer boats sold in NZ are made in NZ which clearly shows the importance to New Zealander’s of supporting their own.”

Given the isolation of Australia and NZ and their reliance on other countries to supply key goods there will no doubt be further investment by the respective governments to enhance their sovereign capability.

MEMBERSHIP

Maryanne asked both Peter and David about their membership and staffing levels since covid, given membership levels and revenue have dropped substantially in some overseas countries.  It also surprised many in the industry last year to see the level of redundancies made by the NMMA a significant USA marine industry association.

David responded; “I am pleased to report we have not had to make any of our team redundant. AIMEX membership however has declined slightly mainly due to the fact a key benefit of membership was the ability to participate in the Australian pavilion at key trade shows and AIMEX has always had a strong itinerary of shows members supported.  With the inability to travel some members have put their membership on hold waiting for international travel to resume. However membership in our superyacht sector has increased by 10%. I attribute this mainly to the work we have done regarding lobbying for exemptions in this sector which as stated earlier has been a boost for the industry.

Peter Busfield responded; “Since May 2020 our membership is up 5% to 500 member companies. This is mainly due to existing members appreciation for our assistance and communications with members through the difficult months of March to June. We assisted members with Covid Health and Safety plans in accordance with Government rules, negotiated with the NZ Government to be allowed to go boating in some of our covid restriction periods and of course the exemptions to allow visiting yachts entry for refit/repairs and being allowed to stay in NZ was a boost for the industry”.

KEY ISSUES MOVING FORWARD

Maryanne asked Peter and David what they see as the key issues facing the Australian industry both the Superyacht and Export sectors.

David Good responded; “For Superyacht Australia it is definitely the consistent application of rules by government departments.  It is the biggest issue and will remain so for a long time. For our exporters it is stability in logistics, foreign exchange rates and global demand. Many countries due to more covid 19 outbreaks are currently looking at further lockdowns.”

Peter Busfield responded; “From the superyacht perspective we have a concern that people in the Northern Hemisphere may not be planning to sail their yacht to the South Pacific in 2021 and as such countries such as Tahiti, Fiji, Australia and NZ will suffer from a reduction in this business in 2021/22. From our exporters perspective the exporting of NZ made equipment is getting more challenging with freight delays and increased costs of freight.”

INDUSTRY INVESTMENT

Maryanne asked Peter and David re the level of investment into the industry currently.

David Good responded; “There is a lot of investment happening here into refit yards and boat building facilities however this growth is mainly occurring in Queensland where we have a supportive state government.

Peter Busfield response; “NZ has seen an increase in refit yards /haul out facilities for large vessels such as the new Orams 820 ton travel lift and yard in downtown Auckland. There has also been recent expansion of facilities in Bay of Islands, Whangarei, Tauranga and Picton. In a normal year and particularly prior to the America’s Cup these facilities would be extremely busy. It is however pleasing to be able to say that during covid they have still had sufficient work to be doing satisfactory business.

WHAT DO YOU SEE AS THE KEY ROLE FOR YOUR ASSOCIATION MOVING FORWARD.

David Good response; “ The key role is to ensure we listen to members and provide value, plus continue to lobbying government on issues affecting the industry. Mentoring of new members is also high on our agenda.”

Peter Busfield responded;  “Adding value to member companies that exceeds the membership fees is of number one importance. Many members see the most value coming from their MIA maintaining/growing the profile of the marine industry in the eyes of stakeholders, i.e. local and central government, the general public and the boating fraternity. This translates to effective representation and strong promotion and profile through the media. In addition to this Peter felt it was very important to work closely with the individual marine industry specialised sectors to ensure we understand the challenges and opportunities of members at the ‘coal face’.

IN SUMMARY

The very issue of distance and isolation from key markets which has made NZ and Australia so resilient over the years has also been the catalyst for their emergence from the covid pandemic in tact and ready to meet the demands of their global and domestic markets.  The ANZAC spirit has prevailed with the NZ and Australia strategy to manage the covid 19 pandemic working well.  The marine industry in both countries has remained vibrant and the surge in boat sales and superyachts looking for a safe haven is definitely supporting the refit yards and the extensive marine industry supply chain.  Restrictions on boating have been removed and the industry is experiencing a busy summer period as everyone gets out on the water.  With no international travel on the horizon for many months the keen interest in chartering and boating is set to continue.  Congratulations must go to both AIMEX and New Zealand Marine who have been proactive and effective in their communications with members and their lobbying to government on members behalf.

Global Marine Business Advisors is a group of marine industry experts, located in fifteen countries. The group is focused on providing a broad range of support services for businesses in the global marine sector.

The consultants currently reside in the UK, France, Finland, Holland, Singapore, Australia, Dubai, Spain, Russia, Italy, South Africa, Turkey, Poland, Sweden and the USA.  Their combined expertise and experience is second to none and with their extensive networks are supporting marine businesses across the globe to drive growth and success in this current environment.

For further information
MaryAnne Edwards
Email: medwards@gmba.blue
Mobile:+61 412916036
Website: www.gmba.blue

N.B. Global Marine Business Advisors and its associated website www.gmba.blue are not registered legal entities. GMBA is a network of independent marine industry advisors. In all articles the opinions expressed are those of the author and does not necessarily reflect those of GMBA

The Asia Pacific Superyacht Association (APSA) officially established in 2011 reaches its 10 year mark this year.  APSA was the first association to be established in Asia with a regional focus on promoting Asian yachting businesses and providing a platform for global businesses to connect with the Asia yachting community. A decade on and APSA is in a positive position to promote the region.

With a current total of 110 members, it would appear APSA’s value is now being seen across the Asian region.  There is no doubt that with the development of the regional boating associations in Asia and the growth and interest in Superyachts in the Asia-Pacific region industry stakeholders are looking to APSA to play a more active role in the region.  It is clear APSA is taking on the challenge with a stronger online presence and the employment of Suzy Rayment an experienced journalist and long-term player in the Asian market.

Maryanne Edwards, from Global Marine Business Advisors (GMBA) interviewed Nigel Beatty discussing where APSA is heading, the current situation in Asia and the issues facing the industry.

M Edwards also recently talked with David Good AIMEX and Peter Busfield Marine NZ looking at the focus of their associations and the issues they are facing.

https://www.gmba.blue/two-trade-associations-delivering-value-to-members-during-the-current-pandemic-part-1/

What do you believe to be the global perception of Asia since the global pandemic?

Nigel response; “The pandemic is ongoing, and I think (from a yachting perspective) the perception towards Asia has changed for the better. It is overall a safer place during COVID 19 than Europe or the Americas. Many brokers are busy and although inter regional transit on most yachts is down, large numbers of yacht owners are using their yachts domestically. Asia is still rising. As well as regionally based yachts there are more than ever European and America based yachts and owners still planning to head to Asia to cruise the circuit here.

Superyacht Australia and NZ Marine were successful in lobbying their governments to provide exemptions for vessels looking for a safe haven during Covid 19. What has been the situation in Asia for visiting superyachts since the pandemic?
Nigel response; “Asia is made up of a number of countries and as such APSA does not lobby individual countries. APSA as a regional association will support any national associations in Asia in their efforts to work with their governments. I can only speak nationally about Japan where I am based and there are no restrictions on yachts entering Japan apart from 14 days quarantine for crew/guests when the yacht arrived. Certain nationality crew can get 90 days stay on arrival extendable, while others get 28 days. The yacht itself can stay if the owner wants it to. I also see reports from Thailand and Indonesia that yachts are arriving and members are working with their local governments to assist these vessels to enter these countries during this time”

Has boating become more popular in Asia since the pandemic or have restrictions caused a decline in boating sales?
Nigel response; “Yacht sales are reported to be up across Asia. Part of this is that we are seeing more yacht ownership year on year anyway, but the pandemic has caused an upwards surge in yacht ownership and people using their boats”.

What has been the govt support for marine industry businesses in Asia. How are your members surviving?
Nigel response; “There are many governments in Asia and things vary with each country so I cannot comment on governmental stimulus and support. While some members of our industry are seeing a decline in business, there is a good proportion of companies seeing expanded business. Take yacht agents for example. While some have seen a decrease in international business, they have also seen an opportunity with the up surge in domestic business and support for yacht owners. Many large yacht owners are still operating and maintaining their yachts, so shore side services are getting some business.”

What is your view re the cancellation of boat shows?
Nigel response; “It was and is right to cancel shows. I look at the decision to go ahead with the Fort Lauderdale Show and I see what a super spreader event that was. Many of my friends and colleagues became Covid 19 positive due to that event. I think the right decision has been taken by the organizers of most of the yacht shows, and the smart ones took early and decisive decisions to spare the participants from wasting their money. The shows will come back. I have “attended” some of the virtual shows out of curiosity and they are not worth it in my opinion. There is nothing like a “tangible” yacht show in our industry and I am sure by the end of 2021 we will be back in full swing attending these shows.

The online forums on the other hand have been good and I think this is a very good way that we can bring the industry together from all over the world in a conference forum or webinar. APSA has its own series of webinars in January coming up called the APSA Grand Tour and will follow the cruising circuit destinations of Asia and Australia/NZ over a three-episode series. We will expand this to include other countries in the near future.”

In the past big events like the Americas Cup have been great for the region how do you feel it will impact the region given so many restrictions apply to crossing borders/quarantine etc
Nigel response; “It is important just like other sporting events in Asia; Winter Olympics Korea, Rugby World Cup Japan, Olympic Games Japan; these are three of the top nine global sporting events, so they are huge for attracting yachts to the region. The Americas Cup is not so big as far as television audience and worldwide interest, but it is more closely aligned to our industry so arguably has just as much impact. It will be sad that because of the pandemic less yachts will make the long journey to NZ to attend. The restrictions however are in place for good reason, but it is going to impact the Americas Cup and the Olympic Games as far as our industry is concerned. I should imagine that the understandably difficult regulations on visitors to NZ will prevent many yachts from visiting there. For the Olympics I think the uncertainty of whether the games will even happen, is a massive decider if a yacht will come to Japan, rather than any restrictions.

What events has APSA got in the pipeline for members?
Nigel response; “As touched on before we have the APSA Grand Tour webinar coming up which is our 10^th anniversary event online. We will follow a superyacht cruising the Asian circuit from NZ to Australia to PNG, Japan, Taiwan, Hong Kong, Singapore, Thailand, and Indonesia.

While I am rather disdainful of virtual boat shows, I really think with the technology now available and improving all the time, webinars and virtual conferences are a very cool jump forward this year. Once boat shows start again, we will recommence our active, popular networking programme.

How has APSA fared regarding membership since COVID?
Nigel response; “We have been ok and on balance we have remained at the membership strength that we were at before the pandemic and also have new members joining. Our members have been incredibly loyal to APSA and as an association we are reaching out to our members to try to make sure they use their Association to get the exposure they need to reach the growing superyacht community in the region and the world. Whether our members are big shipyards, brokerage houses, yacht builders or small to medium sized local businesses, they are all an integral part of the Asian superyacht community, each depending on each other to service the superyacht community and grow the industry. APSA has a clear vision for the future of the industry in Asia and this is enshrined in the articles of the Association.

What are the key issues for superyacht businesses in ASIA moving forward?
Nigel response; “Mainly keeping the upward momentum of the yacht industry in Asia. There are regulatory issues that national organisations are combating, i.e. cruising permits, helicopter operations, charter laws, etc. these are gradually being overcome and APSA members are usually right in the thick of working with their governments to bring in new or amend existing legislation to allow our industry to flourish more.

What do you see as the key role for your association moving forward?
Nigel response; “The key role for APSA is to bring as much business as we can to our members. We will always put our members first and try to promote their business and push business their way. We are contacted by people from around the world that need to get in touch with various sectors of the Asian industry and these enquiries go directly to our members. This business support is also augmented with promotion of the region which we do by social media and publication of the APSA guide detailing as many services around Asia and Pacific as we know about. We also promote the region by events and attending yacht shows around the world.

As a regional association we can put weight behind any initiative that members are working on plus we are happy to support national associations in their lobbying if we can. We are doing this though our connections to the regional associations in Hong Kong, Thailand, Singapore, Indonesia, Malaysia, India, Sri Lanka, and Japan and the list is growing as the industry expands and matures in the region.

SUMMARY
APSA certainly is lifting its profile.  APSA member and AIMEX board member Steve Fisher Rivergate Marina & Shipyard confirms the future role of APSA. “Rivergate is a firm believer in the adage that “… together we achieve more!”, so providing organisations like APSA remain active, I think they can help promote Superyacht Cruising in the Southern Hemisphere and the Pacific. Uniform Cruising regulations and a united approach to marketing could help build the Asia Pacific region as the world’s preeminent Superyacht Cruising Grounds – ambitious, but definitely a worthwhile goal.

David Good, CEO AIMEX, also confirmed the need for organisations like APSA.  “In my view APSA has the potential to be a positive influence in Asia considering the growth predictions for the region. WA and NT have closer ties with Asia than the East Coast of Australia so is important we are connected to Asia. It’s easy to work with this region due to time zones and we all have the same desire to get the vessels out of their traditional milk run either side of the Atlantic and through one of the canals into our part of the world, or even better, base vessels here permanently.”

Professional publications like the Great Southern Route now in its 4^th edition have gone a long way to supporting Asia Pacific as a key cruising destination.  Captains have a thirst for information and publications like GSR and online conferences like the APSA Grand Tour will certainly be viewed positively by stakeholders in the superyacht industry. https://greatsouthernroute.partica.online/great-southern-route/4th-edition-20192020/flipbook

Disclaimer: Global Marine Business Advisors and its associated website www.gmba.blue are not registered legal entities. GMBA is a network of independent marine industry advisors. In all articles the opinions expressed are those of the author and does not necessarily reflect those of GMBA