NZ companies need more government contracts - BusinessNZ

If New Zealand companies are going to grow to their potential, they need a bigger share of government projects, a new report says.

If New Zealand companies are going to grow to their potential, they need a bigger share of government projects, a new report says.

The report, commissioned by the New Zealand Trade and Enterprise's Industry Capability Network (ICN), showed that there was plenty of potential to increase that share, which would result in economic benefits for both the companies involved and the economy.

It said Australian experience showed that for every $1 billion spent on major projects, there was the potential to boost New Zealand's share of revenue by up to $170 million.

However, for that to happen, a change of attitude was required.

Catherine Beard, executive director of manufacturing for BusinessNZ, said if New Zealand companies were to grow in size so that they could enter export markets, they needed a fair crack at larger local projects, which were typically a government spend.

“Too often we see an over-emphasis on price versus quality resulting in poor procurement results, requiring expensive remedial work being carried out,” she said.

“We would like to see a renewed emphasis on whole of life procurement from government, which takes into account price, quality, durability, servicing and local industry capability building.”

She said while it was important that New Zealand companies start winning a bigger share of large government, local government and SOE tenders, that needed to be based on their merits.

ICN and BusinessNZ are holding a series of seminars in Auckland, Wellington and Christchurch this week on what successful New Zealand companies do to win local and global supply chain work.

Large procurement agencies will also be at the seminars to talk about what qualities they look for in supply chain partners.

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