A new boy in town….

Sam Fulton

June 15, 2017

A new boy in town….

Bob Jones Account Manager FeroBob Jones has joined the Fero team as an Acount Manager and brings with him a wealth of knowledge and experience. With 40 plus years in the industrial, electrical distribution industry Bob certainly knows a thing or two! He has been in both sales and management roles within his career so truly understands the processes involved.

 

Working with companies such as CSL Cuthbert Stewart Ltd and Connection Technologies he has been able to provide solutions for electrical, electronic and connectivity applications for over 35 years.

 

He has an extensive knowledge of the electrical industry and over the years has gained a lot of experience in both the manufacturing and distribution of electrical products.

We see this being a great fit for Fero and look forward to Bob growing with the business and management team.

 

Bob’s role within Fero is to work with Key Accounts assisting in identifying new wire technology and component supply solutions to both existing and new customers. We are really excited about this and the opportunities it may bring.

 

Bob is not only proficient in this industry he can also hold his own at softball and rugby, being selected in the mid 70’s for the NZ Softball Team. Now with a grown up family and three magnificent grandchildren, Bob enjoys the family life and has just celebrated 40 years of marriage to his wife, Barbara.

 

 

Sam Fulton

June 1, 2017

What’s Looming for Fero?

Although much of our core business is in the production of wiring looms, it would be a mistake to think that this is all we do. As a business we see ourselves as providing assembly services for manufacturers. Often this involves the assembly of wiring looms to streamline the manufacturing process, but at other times we use our teams to assemble other elements as part of a sub-assembly process.

 

Sub assembly solutions

 

We use our resources, plant and systems to run sub assembly projects for various clients, combining our electrical experience with other materials. Often these types of projects start with a conversation about wiring but then develop into an understanding that we can provide more solutions and take on more sub assembly.

 

Due to our very strong relationships with Chinese suppliers we’re winning business in Australia and even Europe. We’re using our connections to source a whole variety of materials, and moving beyond simply wiring solutions.

 

As we take on more sub assembly tasks, we’re proving ourselves to be more efficient in speed of turnaround, more consistent in quality and often much more economical for smaller businesses that don’t want to tie up capital in staff costs.

Let’s Talk

If you’re interested in outsourcing more of your sub assembly to free up staff for other roles, or to reduce your capital outlay and/or inventory costs, we would love to talk to you. We have built up some excellent case studies recently that demonstrate our ability and prove the business for outsourced sub assembly.

Heading to China

In the next few weeks we’re heading back over to China and talking to our partners about a variety of materials, including aluminium extrusions for an upcoming project.

 

Call Sam on 09 274 0104, and discover more.

Sam Fulton

May 15, 2017

NZ Manufacturing Update

The start of 2017 had some of us concerned with a PMI of 53.2 back in January but this seems like a distant memory now with the industry seeing another great few months of productivity. The sector is remaining healthy and according to the BNZ – BusinessNZ Performance of Manufacturing Index (PMI) both March and April have been very positive with an index of 58.0 and 56.8 respectively (a PMI reading above 50.0 indicates that manufacturing is generally expanding; below 50.0 that it is declining).

 

Since the beginning of the year new orders are still leading from the front, with an index reading of 62.4, while production itself is reasonably expansive, at 56.9.

 

We all know how important it is to encourage and grow the NZ manufacturing business, so it is encouraging when looking at the staffing figures from the previous two months, that April’s PMI index on employment was 53.0. This was about as robust as it was in March (53.5) and so still securely above its long-term average, of 50.5. In the March quarter of 2017 it was up 6.0% on the same quarter a year ago suggesting growth in the marketplace.

 

Fero manufacturing update

 

With NZ’s manufactured exports making up around 85% of all merchandise exports from this country, it’s vital to see the sector continually growing and moving towards more innovative and specialised goods and services that may earn the country higher export revenues.

 

Let’s hope 2017 continues to remain positive for the next few quarters.

Sam Fulton

April 26, 2017

China – a formidable force.

Mobile Phones in China

There is no denying it, China is a formidable force. It has truly transformed itself and the world economy has had to take notice. In 1990 China produced less than 3% of global manufacturing output, by value; its share now is nearly a quarter!

 

Just to put this in perspective China produces 80% of the world’s air conditioners, 70% of its mobile phones and 60% of its shoes. Many thought that the baton would pass to other parts of the world in due course but this has not been the case, and if anything we can see China’s grip tightening.

 

What makes them so strong?

 

1. Low Cost Manufacturing
China is still known for it’s low cost manufacturing and that is why so many people still manufacture in China.

 

2. Factory Asia

“Factory Asia” is a term used by manufacturers. It has come about due to wages increasing in China. Because of these increases they are having to pass some of the “low cost activity” to large low income populations in South East Asia whilst still maintaining their central base in China.

 

3. Increased Demand
As spending and sophistication of Chinese consumers grows we see “Factory Asia” grabbing a bigger share of the higher margin marketing and customer service. As chinese demand increases it strengthens Asia’s supply chains.

 

4. Less Regulation
In the past China has been able to produce with much less regulation than in other parts of the world. This is changing as China is forced to take a look at it’s industry and the regulations it operates under.

How does it all affect us?

Here in NZ, we have a growing manufacturing sector. Some companies like ourselves, choose to do business on both sides of the world. We not only manufacture here in NZ for our customers but if we deem appropriate we will offer to take some of their manufacturing over to China. Having the flexibility and relationships with China enables us to get larger production completed at a lesser rate and pass this saving onto our customers. Fero Manufacturing in China

So where does the future lie?

At Fero we believe that our model gives customers the best solution. Manufacturing locally gives customers peace of mind. They value the fact that we are NZ owned and that we have a team of engineers in-house that can design solutions and offer advice. They also know that Fero understand their business and can react quickly if a small batch of looms is required.

 

But on the other hand some of our larger companies love the fact that we also have very strong relationships with our factories in China and can give them the cost down that they need to be competitive in the marketplace. Due to the number of years that Fero have spent in China we know that the materials used and the manufacturing is as good as ours in NZ so are happy to use these factories.

 

It’s a WIN WIN situation for most of our customers – the best combination of both local and offshore manufacturing and assembly.

Sam Fulton

March 23, 2017

Focus on Copper

Did you know?

Copper is man’s oldest metal, dating back more than 10,000 years. A copper pendant discovered in what is now northern Iraq goes back to about 8700 B.C.

 

There are 1.6 billion tons of Copper reserves known in the world – it seems a lot, but when it’s gone, it’s gone.

 

Twenty mines account for about 99% of production – that makes for 20 very influential mines!

 

Pure copper’s melting point is 1,981°F (1,083°C, 1356°K). Its most important properties include superior heat transfer, electrical conductivity and corrosion resistance.

 

Copper and Fero

An everyday metal

Copper is a mineral and an element essential to our everyday lives. It is a major industrial metal because of its high ductility, malleability, thermal and electrical conductivity and resistance to corrosion. It is an essential nutrient in our daily diet. And, its antimicrobial property is becoming increasingly important to the prevention of infection. It ranks third after iron and aluminum in terms of quantities consumed in the USA.

 

Copper wiring

Due to it’s unique conductivity properties copper is essential in electrical wiring. Copper wire price fluctuates heavily due to many different factors including the supply and demand of copper globally, the emergence of different types of wire and even seasonal conditions.

 

The price of Copper

Copper, until recently one of the worst performing commodities of the past two years, experienced a sustained spike of 33% at the end of 2016, posing several questions as to the direction of the market as we move into 2017.

 

The biggest single cause of the price rise has been a pick-up in Chinese imports, responsible for almost 50% of global copper demand. This is seen a good omen for the industry’s health.

 

There are some who claim it will be short-lived, but in my opinion this is short sighted.

Copper And Fero

In reality I, and many others, feel the market has the potential be driven higher this year and next, if not by outright supply tightness then by the perception the market is moving in that direction.

 

Put simply we’re seeing more demand from China and only 20 mines to extract it, added to the fact that it is a finite resource.

 

The general trend over the long term has been that copper prices have fallen since a high in 2011. These falling costs have helped offset a strengthening US Dollar against the RMB, and have resulted in a neutral outcome in the market.

Fero and the Copper story

Suffice to say the price of copper has a big effect on our business, with much of our wiring containing copper. We watch the London Metal Exchange with interest, and will continue to do so. As a business, have already seen some significant increases in raw material costs coming through. Our hope is that we will see a smoothing out of the pricing and that we will be able to absorb the extra cost without being forced to pass it on to our customers.

 

We will monitor the market and keep you updated on how copper performs over the next few months.

 

Sam Fulton

March 14, 2017

What’s His Story…..

Fero Engineering ManagerAt Fero we really value our staff and believe it’s important to get to know the person behind the desk, so to speak!  On average our staff stay with us for 7 years so by the time they leave they are well and truly part of the Fero family.

 

With the recent shuffle of staff we thought it would be a good idea to introduce our new engineering manager, Cata to your properly and for you to hear his story…..

 

Cata was born and grew up in Fagaras, a small historic town situated in Central Transilvania (Romania). He studied hard and after he finished high school he moved to Brasov (probably one of the best cities in Eastern Europe he reckons) where he studied Engineering Technology for 5 years (Bachelors Degree) and Mechatronics & Robotics for another 2 (Master’s Degree).

 

He moved to New Zealand in 2014 and loves the beauty of our country and the people living within it. Cata and his wife say moving here is one of the best decisions they have ever made and they have created a home and a family here now.

 

Over the course of his career, Cata has worked at ALFA Group, Aerotec Romania and NZ Window Shades. He has provided leadership and oversight in the design and implementation of high quality manufacturing processes within automotive, aerospace and manufacturing environments. He has played a key role in new factory start-ups, quality improvement processes and workflow streamlining projects, employing his Lean Management skills and Kaizen training to deliver significant improvements to workplace quality and productivity. His efforts have saved his employers significant costs and boosted profitability by reducing overhead and increasing the quality of finished goods.

 

We are really looking forward to Cata putting all this experience into practise at Fero and look forward to him growing with the business and management team. When we asked Cata what his short and long term goals were at Fero they were very clear:

  1. to obtain ISO 9001 certifications and organise the engineering department in a LEAN way
  2. to implement TS 16949 and make Fero a world class manufacturer in automotive and other fields

When I asked Cata what the biggest lesson he had learnt throughout his life he said his parents had taught him “ the ability to value and appreciate people” and by doing this he believes that you will always get the best out of them.

If you would like to contact Cata regarding any engineering project then please do not hesitate to contact him at catalin.goran@fero.co.nz

Sam Fulton

March 3, 2017

Manufacturing in China with Fero

With all the volatility and uncertainty surrounding the Chinese economy right now, some companies, manufacturing their products in China, may be concerned how it might affect their business. So, we thought it might be a good time to explain how Fero works with some of it’s clients in China.

 

Many companies see China as the answer to all their problems. Surely when you deal with China you get lower costs, better service and higher outputs/quicker times?

 

But it’s not all a bed of roses and there are definitely some challenges that most companies will face. Here are the top 4 reasons people struggle with China:

 

Fero partnerships in China

1. Finding a Factory

The #1 reason why people don’t manufacture overseas seems to be that it’s just not easy to find a factory. At Fero we understand this and that is why we have done all the hard work for you. We have found various suppliers that will deliver our products to the highest spec and we are happy to introduce you.

2. Language/Communication

The language barrier does exist and can be hard and frustrating at times. Using webcams and photographs at every stage of the process can be essential. At Fero we have staff that speak the language so can easily converse direct with our Chinese manufacturers. We have also been able to customise the process so everyone understands what is required and when.

3. Higher Minimums

Chinese factories often work in quite high MOQs and sometimes these figures can simply rule you out of the market. At Fero we are able to produce shorter runs here in NZ and then send some of our other work, where relevant, out to China, giving you a WIN WIN situation.

4. Quality of Work (Sometimes)

This is something that can be hit and miss. Companies must stay on top of quality control because mistakes happen and corners are cut – no matter where the factory is located. At Fero we have put in stringent quality control checks throughout the whole process. This includes getting samples made up, changing materials and testing the looms before we even agree to manufacture.

So is China still a good place to manufacture?

Yep absolutely, as long as you know what you are doing and have some experience in the field.

 

At Fero we have been able to develop relationships over many years. Our Chinese factories understand our processes and the quality that we expect. This knowledge and experience enables us to offer some clients the ability to take some of their work offshore if appropriate whilst still maintaining manufacturing here in NZ.

 

If you are interested in getting Fero involved in your manufacturing, give Sam a call on 09 274 0104.

Sam Fulton

February 28, 2017

Important news from Fero

We are aware that after the announcement to the market yesterday of the liquidation of TradeTech NZ that there is some confusion as to how this relates to Fero.

Prior to 2014 Fero incorporated TradeTech and Wire Solutions.  In 2014 Fero sold TradeTech NZ to a private operator.  At this time Fero and TradeTech became completely separate entities with no common ownership or other interests.  Both companies are operating in different sectors of the market and providing different services.

 

As separate entities Fero is in no way effected by the liquidation of TradeTech. 

 

We do have some common customers, and some of those customers are unclear on how the businesses are structured and owned.  This has caused some confusion in the market, of which we would like to clear up.  Fero is a business that has seen significant growth since 2014 and is very secure in its operations.  We have a strong future supporting New Zealand Manufacturers and helping to ensure that the local manufacturing sector remains strong.  2017 looks to be a very exciting year for Fero with a number of new initiatives that we will be introducing to support our customers and to continue to support manufacturing in New Zealand.

 

If there are any questions or uncertainties I am always happy to discuss.  Please don’t hesitate to contact me at sam.fulton@fero.co.nz

 

Sam Fulton

February 19, 2017

Why manufacturing is so important to NZ

Typically New Zealanders do not think of themselves as living in a manufacturing economy. But New Zealand’s manufacturing industries make an important contribution to the national economy. In the year ended September 2015, the manufacturing sector output accounted for around 10% of real GDP and 11% of the labour force.

Manufacturing NZ

But this misperception can have a detrimental effect on the growth of NZ manufacturing and we as kiwi’s should be aware and proud of how important manufacturing is to our country.

Skills

 

If we do not have the skills, talent and training coming into the industry then this could undermine the potential for growth. It is not surprising that some high- growth manufacturing firms emphasise skill shortages and other constraints on talent- driven growth as being much more important than any effects of costs or exchange rates.

It’s interesting when you look at surveys that highlight the traits of NZ manufacturing firms. Typically these firms are:

 

  • Largely export oriented

 

  • Predominantly locally owned

 

  • Mostly privately held

 

  • Vertically integrated in the domestic market and in offshore markets where they have a large presence.

 

  • Still manufacturing in New Zealand where it makes sense for the entire or part of the production process to do so, and engaging in research, design and the provision of services.

 

So what makes us competitive?

 

Well, sometimes being a small country does have its advantages and the architecture of NZ firms can be seen as an advantage. By being local, privately owned companies we can be more specialised and therefore more focused on innovation rather than cost-minimisation.

 

A country of our size creates nimble companies that need to adapt to changes offshore, both political and economic. Take Donald Trump in the USA. Should we fear what’s happening in that market and how it will affect NZ manufacturing? I believe not. NZ companies are nimble enough to adapt – we’ve had to for years. We’ll either find a way to provide the USA with the solutions it wants or we’ll look to other markets like China, Europe, even the Commonwealth.

 

At Fero we feel we are small enough to care but big enough to deliver and we really stand by this. We are growing as a company but we do have very strong values and beliefs. We are always looking for ways to improve our processes and we are constantly building stronger ties with China. This relationship allows us to manage the processes and get some cost down but most importantly monitor quality and consistency.  

 

Sam Fulton

February 8, 2017

2016 was a positive year – how will 2017 fair?

2016 was a positive year for NZ manufacturing and saw consistent expansion throughout the year. Catherine Beard, Business NZ’s executive director for manufacturing, said that the results were encouraging.

 

The activity in the manufacturing sector over 2016 averaged out at 56.0. This showed an increase from 54.2 in 2015, but interestingly the same result as both 2014 and 2013. Overall, this shows how consistent and how positive the activity has been for the sector over the last few years.

 

There is also a very positive feeling around the manufacturing sector and positive comments stood at 70% for December, with seasonal factors (particularly Xmas) having a strong influence.

 

BNZ Senior Economist, Craig Ebert, said “the December result caps off a positive year for the manufacturing sector.  Indeed, since the survey started in 2002, last year’s average has only been surpassed by 2004’s 57.5”.

 

So what can we expect for the new year?

The general consensus is that the NZ Manufacturing sector is in good shape and that 2017 will continue to expand at a steady rate. However, Economist Doug Steel does feel that there could be a few warning signs that should not be ignored.

NZ Manufacturing Index

 

In December PMI new orders fell to 52.6 in December, which still indicates growth but it is the lowest level of new orders for nearly two years. Therefore this is worth watching over the next quarter as an indicator of sale growth ahead. The industry’s new orders also slowed a bit in the QSBO (qrtly survey of business opinion).

 

Having said that it appears that manufacturers in the QSBO are more confident this year than last. A net 23% expect better economic conditions over the coming six months. This compares to a net 4% expecting improvement in the previous survey. It’s a decent lift and sets confidence well above long-term norms, of -6.

 

So, let’s continue doing what we are doing NZ and make our country proud of what we add to the economy and the manufacturing sector around the world.