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Leaping the ditch

By Gina Garvey

When growing Kiwi companies start thinking of expansion, they hardly need lift their gaze before Australia looms large on the horizon. With over five times New Zealand’s population, our nearest neighbour is also our biggest export market, worth over $NZ 9.1 billion annually.

Indeed our commonalities would seem to make expanding into the Australian market not just an obvious choice but a straightforward one – on top of our similar values, language and enjoyed sporting rivalry, there’s our long interdependent trading and investment history.

This includes the deeply entrenched CER and a fresh impetus that both Prime Ministers have recently given towards developing a seamless trans-Tasman business environment by way of a Single Economic Market.

So what’s to think about? Quite a lot, says NZTE’s regional director in Australia, Tim Green.

“Australia seems so close and easy that companies don’t think through the homework they need to do in advance, and then later wonder why they’ve come unstuck.”

New Zealand company Kea Campers, which designs and builds campervans and motorhomes, has been in the Australian market for eight years.

Managing director Grant Brady says their imagined journey of entering into Australia was worlds away from the actual one.

“If you look at our business in simple terms, the vehicles are identical, the agents in Europe are identical, the client base is identical – there’s a lot of commonality. But once you get into operational issues, the differences are massive.”

New Zealand Trade and Enterprise (NZTE) has conducted research which explored the experiences of New Zealand businesses across a range of sectors that have made the move across the Tasman.

It reveals five predictors of success – clarity, cash, connections, capability and commitment:

1. Clarity

The research found that having a clear vision of what success will look like, and doing research to understand how you will achieve product differentiation and placement in the market, are vital to optimising success in Australia.

Alasdair MacLeod from Deloittes, who undertook the research for NZTE, says that without exception, the people who succeed don’t make assumptions – they actually go and test things.

“If you don’t have absolute clarity of vision about what you’re going to achieve, you’re probably not going to achieve it.”