Convex Plastics Look To New Overseas Markets

After cultivating the Australian market for the past four years, Hamilton-based Convex Plastics is to open a two-person Sydney-based Australian sales office next January.

The company will also appoint representatives in both Hong Kong and Singapore after General Manager Owen Embling's visit to South East Asia last year. Embling expects a return visit to Hong Kong in August will result in the appointment of distributors for these markets and The Philippines by early next year.

To capitalise on the fast-growing Australian market, Embling plans to either build a manufacturing facility or take over an existing operation there within two years. He is also planning to visit The Philippines later this year to investigate entering a joint venture in a film manufacturing plant in 1998.

The company has invested $6m in new plant and co-extrusion technology over the past two years and will spend another $1m this year. "We'd like to duplicate the major operation we've developed locally in Asia. Drawcards include lower labour costs, significant tax breaks and possible reverse exports back into New Zealand," says Embling. Having significant extrusion capability in Asia will help springboard the company into new markets within the Asian region in the short term.

"While the local market remains our bread and butter market in 1997, we recognise that the Australian and Asian markets are likely to eclipse this within three years." Demand from private wholesalers in Asia will continue to grow as the regions develop at a rapid pace.

"While we've managed to crack the Australian market on our own, we recognise we can not duplicate this approach in Asia. As a result, we're being versed in Asian protocol."

In 1991 the company, a specialist in fill and seal plastics for machine packaging, had no sales outside the North Island. Exports to Australia are now 20% of total turnover. What opened up the Australian market was its developments with co-extrusion plastics. Despite having a superior product Embling says it took 18 months before new technology received market acceptance across the Tasman.

"In the early days the product was too far removed from where the industry saw itself for it to receive overnight approval. Despite the opportunities available to Australian manufacturers, we had to lead them one step at a time down a process of change. As a result, we had to develop initial products for the Australian market that closely resembled what the customer was used to," says Embling.

Until five years ago major shortcomings with ink, film and lamination technology meant there was little variation beyond plain, low cost film, which had limited commercial application.

Developments with co-extrusion, which bonds multiple layers of film together, means packaging material can hold certain inks even against certain chemicals.

As a result, the company has become a major supplier to one of Australia's leading pet food manufacturers in the packaging of dry dog and cat foods. The company's plastics are also popular with Australia's horticultural sector which uses the plastic for packaging potting mix and fertilisers.

"What triggered our foothold on the Australian market was slow and protracted wooing of the Australian manufacturer. We had to convince them that technology advancements brought with it a suite of new packaging solutions beyond anything they'd seen before," says Embling.

Convex is sending monthly consignments by sea or airfreight into Australia, depending on clients' needs.

However, the company plans to sea freight in bulk and distribute from its own warehouse, which also opens in Sydney next January.

The company is looking for an Australian-based logistics supplier to establish a distribution network for its 300 tonnes of product shipped into Australia annually.
 permeable re~fresh membranes and apply them to other applications such as lidding stocks and form fill and seal films without deteriorating the permeable nature of the web.