// 1// SEPTEMBER / OCTOBER 2015

SEPTEMBER/OCTOBER 2015

PagE 12

PagES 32-33 PagES 8-9 PagE 31

PagE 15

PagE 6

EXPORTERS STRUGGLE TO UNDERSTAND FTAs

WHY BUYING AGENTS ARE BIG BUSINESS IN CHINA

HOW THE AUSSIE MADE LOGO CAN GIVE YOU AN EXPORT EDGE

KEYS TO SUCCESSFUL FOOD EXPORT TO ASIA

BOOM IN MEDICAL TECH EXPORTS

LOCAL FASHION DESIGNER DRESSED FOR EXPORT SUCCESS

// 2// SEPTEMBER / OCTOBER 2015

a smarter way to trade

From the editor

Finally, there’s a bright light at the end of the tunnel.

Now is an exciting time to be an Australian exporter.

The past year has seen some of the most significant developments in the Australian export sector for many years.

The black cloud (a stubbornly high Australian dollar) that has been hanging over local exporters in recent years is lifting.

The Australian dollar is steadily falling against major global currencies and the recent signing of a trifecta of key Free Trade Agreements with our major Asian trading partners should put a smile on the face of every Australian exporter.

Welcome to the first edition of the new Dynamic Export eMagazine.

In each bi-monthly edition we will highlight the latest issues in export and explain how those issues will affect you.

Not only will we bring you the latest news, you’ll also get features, opinions and vital information needed to help grow your business.

In this issue we focus on China, Japan and Korea FTAs and explain how they will benefit Australian exporters.

And Barry Thomas, APAC Managing Director of Cook Medical Australia, explains how Australia is well placed to take advantage of the global demand for advanced medical technology.

Also, David Rubie, Manager Industry Logistics at Dematic, reveals the keys to successful food export to Asia

We also feature special reports on Australian Made, fashion, freight, export grants and explain why you may need a Trade Mark.

Enjoy … we look forward to your feedback.

Tim michaelEDitor

@dynamicexport

Director and National Sales ManagerJulie Fletcherjulie@dynamicexport.com.au

Our team

Think Positive Pty Ltd cannot be held liable for any person(s), company or business acting upon or using the information provided in this e-magazine in any way. Information and content in Dynamic Export e-Magazine is provided to the best of our knowledge. We advise that you should seek independent professional advice to verify that all information is accurate and correct.

EditorTim michaeleditor@dynamicexport.com.au

ProductionVeronica avant

IT ManagerRob Fearn

Researchmark Zakoshanski

Contributorsanthony Fensom, David Rubie, Barry Thomas

Advertising enquiries: advertising@dynamicexport.com.au

Editorial submissions: editor@dynamicexport.com.au

www.dynamicexport.com.au

Published by:Think Positive Pty ltdPO Box 221Waverley NSW 2024 australia

editor@dynamicexport.com.au

// 3// SEPTEMBER / OCTOBER 2015

Australian medicine exports plunge by 30 percent

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CHINa Fta

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FOreIGN eXCHaNGe

Global demand for advanced medical technology never stronger

TPP in doubt, but Asia FTAs give exporters a boost

Why buying agents are big business in China

Opening new doors for Australian exporters

Australia should look to Arab nations for meat exports

Soon you can fly from New York to London in 3 hours

Trade Marks examined

How eCargo can open the door to China

Melbourne designer finds key to export success

The keys to successful food export to Asia

Compass can point you in the right direction

news

nEWs

NewS3-5

6-7

34-35

auStraLIaN MaDe

wHat’S ON

Australian medicines exports have declined by 30 percent in one year, according to latest industry

figures.The huge decline highlights the

enormous challenges facing the local industry as it struggles to remain competitive in the global pharmaceutical industry, says Medicines Australia, which represents the pharmaceutical industry in Australia.

Five years ago, medicines were Australia’s largest manufactured export, bringing in more than $4 billion to the local economy, Medicines Australia says.

Today, manufactured medicines have slipped to second place behind the motor vehicle industry. If the trend continues, medicine manufacturing will shortly drop to third.

The latest figures released by the Australian Bureau of Statistics reveal that in the first six months of 2015, Australian manufacturing exports were $1.06 billion, compared to $1.49 billion in the first half of 2014, representing a 28.5 percent decline.

Pharmaceutical exports were 30 percent lower in June 2015, compared to June 2014.

Such a dramatic fall in the rankings should be ringing alarm bells in Canberra, Medicines Australia says.

The body warns that Australia is set to miss out on enormous economic and job creating opportunities at a time of growing demand for innovative, safe and effective medicine products in Asia, particularly in China.

It has called on the federal government to do more to encourage growth in the biopharmaceutical sector.

Though the steadily falling Australian dollar is making medicine exports more competitive, this is not enough to reverse the trend.

In a submission to the current Senate inquiry into Australia’s Innovation System, Medicines Australia outlined key principles to invigorate the Australian medicines industry, which included:

• secure the existing investment we have in Australia to ensure it stays here

• Encourage the development of Australia’s local bio-pharmaceutical sector and

• Attract new direct foreign investment to Australia.

The submission argued that by following these key principles, Australia could take advantage of the Asia boom and at least double current medicine exports, but with stiff competition from other nations, the time to act is running out. •••

// 4// SEPTEMBER / OCTOBER 2015

news

Australian lamb exports expected to soar

Australian lamb exports are expected to hit record highs next year, boosted by the steadily falling Australian dollar.

Farm incomes are increasing strongly for beef producers, recording an almost 100 percent year-on-year increase.

Meat and Livestock Australia (MLA) is predicting a six per cent increase in exports – almost a third higher than the five-year average.

This follows a four per cent increase in shipments for the first half of 2015.

“The growth in lamb exports will be driven by a number of factors, including high levels of Australian production, the current weakness of the Australian dollar against the US dollar and high levels of demand from key export markets,” the UK’s Agriculture and Horticulture Development Board (AHDB) said in a recent statement.

“The declining volumes of mutton shipped is due to a fall in production and lower levels of demand from China.”

Mutton exports, in contrast, are expected to fall 23 per cent to 142,000 tonnes after last year’s high volumes.

According to MLA Australian lamb exports in July declined 17 percent on levels last year, to 17,191 tonnes swt – but were still 4 percent above the five-year monthly average. •••

A report by the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES), showed the high returns are the result of increased cattle prices and the highest beef cattle turn-off in 36 years.

Minister for Agriculture, Barnaby Joyce said strong international demand for Australian beef and live cattle had resulted in higher beef cattle prices, pushing up farm gate returns.

“Beef producers in northern Australia have seen the most significant increase in farm cash incomes – an average of $148,000 per farm in 2014-15, up from $74,700 in the previous year, representing a 98.1 per cent increase, or around 50 per cent above the average for the previous 10 years,” Mr Joyce said.

“While in southern Australia, farm cash income of beef cattle producers is estimated to have increased from an average of $38,100 a farm in 2013-14 to $64,000 a farm in 2014-15.

“Increases in cattle sold for live export and higher cattle prices resulted in farm cash income in the northern live cattle export region increasing from an average of $143,000 a farm in 2013-14 to $277,000 a farm in 2014-15.” •••

Healthy returns for Australian beef producers

// 5// SEPTEMBER / OCTOBER 2015

news

Education exports hit record highAustralia’s international education services sector reached a record

This was a 14.2 per cent increase over the previous year.

Australian Bureau of Statistics figures show that education is now by far the major service export, well ahead of tourism, which grew 5.1 per cent to $14.6 billion in 2014-15.

Federal Education Minister Christopher Pyne said international education is a major employer, supporting about 130,000 Australian jobs.

“These figures confirm once again that international education remains Australia’s largest services export and our fourth largest export overall after iron ore, coal and natural gas,” Mr Pyne said.

The lower Australia dollar is a major factor boosting international student numbers, with the latest figures showing that enrolments in the first half of 2015 reached 465,000, 10.4 per cent above the same period last year. Universities and other higher education providers enrolled 222,000 of these

students.The strong growth in education export value is a

positive lead-in to the federal government’s second major industry consultation with international educators in Canberra this week.

“I’m looking forward to further robust discussions on the strategy with education and business experts, students, and community representatives at the Roundtable on International Education at Parliament House next week,” Mr Pyne said.

“The Government will continue to work to ensure that international education continues to be a major contributor to the growing strength of the Australian economy and job creation well into the future.”

Education exports peaked in 2009-10 at $16.4 billion before being hit by a downturn.

This was due to a strong Australian dollar, concerns about student safety and poor regulation of vocational education providers. •••

Federal Education

Minister

Christopher Pyne

said international

education is a

major employer,

supporting about

130,000 Australian

jobs.

// 6// SEPTEMBER / OCTOBER 2015

AustrAliAn mAde

How the Australian Made logo can give you an export edgethe Australian made, Australian Grown (AmAG) logo is an icon in Australia, but if you haven’t ventured elsewhere, you might not know that the stylised green-and-gold kangaroo is just as well regarded in other markets.

Australia has a strong reputation for high quality products and produce, made and grown to high safety standards, because the regulations

around producing goods in Australia are some of the most stringent in the world.

This is bolstered by the fact that the symbol has been used in an export context for nearly three decades.

There are more than 2,300 Australian growers and manufacturers registered to use the logo on more than 15,000 certified products sold here and around the world, and it has been used to brand major trade

shows and events throughout its history.

It has even been actively promoted in export markets since 2004 as part of a government-funded program to enhance its performance as an export tool.

The symbol provides crucial authenticity in the global marketplace, reinforced in recent years by the registration of the mark in China, Singapore, South Korea and the USA.

The logo: • Helps businesses grow their sales by more

// 7// SEPTEMBER / OCTOBER 2015

AustrAliAn mAde

Australian Made Campaign Partner Oz-Town will launch the first five of its showrooms in China this month.The chain will offer a “one-stop-shop” for businesses interested in exporting to China, providing a wide range of services, from coordinating shipping, to overseeing customs clearance, managing warehousing, showcases, marketing, sales and customer service.In addition to promotion in the five physical Oz-Town showrooms, which will be based in the key cities of Guangzhou, Haerbin, Shanghai, Yantai and Zhengzhou, Oz-Town is also able to facilitate online retail sales via major Chinese ecommerce platforms Tmall, JD, Papago and Haitaocheng.For more information visit www.oz-town.com or contact Yvonne Zhang on 02 8246 8309 or yvonne.zhang@oz-town.com or export@oz-town.com

effectively promoting their products as Australian, on packaging and across marketing and communications materials; and

• Makes it easy for shoppers to find Australian Made and Australian Grown goods.

The logo is available to businesses of all sizes and is promoted in a marketing campaign worth millions of dollars every year.

The Australian Made Campaign also facilitates access to a range of exclusive promotional and export opportunities, via media and service partners, and its network of Australian Made branded stores and distributors throughout Australia and Asia.

The green-and-gold Australian Made, Australian Grown (AMAG) logo is the only registered country-of-origin certification trade mark for the full range of genuine Australian products and produce.

To find out how the logo can help your business visit www.australianmade.com.au or call 1800 350 520. •••

Oz-Town to launch showrooms in China

// 8// SEPTEMBER / OCTOBER 2015

Global demand for advanced medical technology has never been stronger And Australia is helping to drive growth in this bourgeoning market

feAture story

Barry Thomas

The global medical technology market is huge and Australia plays a key role in it, shaping the way forward.

What’s driving the growth is the increasing affluence of developed and developing countries.

At the same time, people are living longer. They are demanding a higher quality of life and, as they age, a top standard of healthcare.

Frost and Sullivan data shows that the global advanced technology market, which includes medical devices, medical imaging and patient monitoring, is worth $US342.8 billion ($A465.6 billion).

The Asia Pacific market represents 18.5 per cent of the global market and is valued at $US63.5 billion (A$86.2 billion). Australia’s share sits at 1.98 per cent and is worth $US6.81 billion ($A9.24 billion).

The growth of rapidly advancing nations throughout Asia is set to continue. By 2030 Asian nations are expected to form 15 out of the top 20 global trade partnerships.

According to PwC, this means the region has now already surpassed the US as the world’s biggest trading partner. The value of doing business in Asia is unquestionable and Australia has a geographical and time zone advantage over nations such as the UK and the US.

The medical device industry has often been described as a “sunrise industry”, ticking all the boxes of advanced manufacturing and providing high value-added products. Operating in global supply chains,

these companies have workforces that are highly skilled.

The medical technology sector is constantly evolving, moving into new areas and changing the way things are done. It is constantly expanding into new fields of science and engineering.

Nanotechnology and other areas of research are facilitating one innovation after the other in the biomedical sphere. There is now an increasing convergence of biological technologies and physical technologies like engineering.

The Australian medical technology market has distinctive statistics and features that are quite remarkable for a population the size of Calcutta. Australia has more than 500 medical device companies and 34 of them are listed on the Australian stock exchange, representing about 39 per cent of the ASX-listed life sciences market. The total market capitalisation of these ASX-listed companies came out $A12.79 billion by October 2013.

With the exception of the few experienced players such as ourselves, ResMed and Cochlear, the bulk of Australia’s medical technology companies are young and small. They include manufacturers, specialised in niche applications in the fields of cardiovascular, diagnostic, hearing, orthopaedic, respiratory devices, as well as health IT, health infrastructure, services and clinical trials. These companies are out there competing globally with big multinationals for market share.

// 9// SEPTEMBER / OCTOBER 2015

feAture story

IBIS World estimates that Australia’s medical and surgical equipment manufacturing market has an annual turnover of $3 billion with a compound growth rate of 2.1 per cent per annum over the five years through 2015-16.

For a small market, Australia is making inroads into the global market because it has some real competitive advantages with reduced time to market compared with drug discovery, a highly skilled workforce and a unique geographic positioning in the Asia-Pacific region.

Cook Medical is the largest privately owned medical device company in the world, and we recognised the importance of Asia. Indeed, our growth would not have been possible without the Asia-Pacific’s contribution to the company’s global sales. In 2014, the region generated 20 per cent of Cook’s global revenue and its market penetration in the APAC region is growing.

The way we differentiate ourselves from our competitors is through a focus on innovation that is of benefit to patient outcomes. In 2014 Cook Medical Australia manufactured more than 10,000 stent grafts for the treatment of aortic aneurysms, a form of heart disease.

These included 3000 patient specific custom made devices. This is where innovation really shows its value. Just over three quarter of a million needles were produced to assist in the treatment of reproductive health. All this was manufactured locally and 92 per cent was exported to over 130 markets around the globe.

At Cook Medical our “patient first” philosophy has helped us to foster this innovation and continue to create new healthcare technology that improves people’s quality of life every day. However despite this being very ‘advanced manufacturing’ there is still a significant human element to what we do.

We will always struggle to compete with low-wage, low tax economies that are more attractive for manufacturing operations. However, it’s my view that this sort of specialised manufacturing is a major opportunity for Australia. We can offer a standard of product with other markets struggle to compete with. However, it’s not a simple solution for the future of manufacturing.

As healthcare systems across the globe advance,

and populations age, demand for advanced medical technology increases. Medical treatments are advancing rapidly and one-size-fits all solutions are not adequate. Australia has always been an innovative country, but with manufacturing increasingly heading offshore we have a challenge.

This is because manufacturing and innovation are two sides of the same coin. As manufacturing goes, the

innovation, which often begins on the factory floor, begins to go with it. This presents a problem for us as an economy striving to be “knowledge-based.”

Compounding this issue is that our research and development is also under threat by international markets beating us to

better policy. In particular “patent box” tax breaks. These tax incentives encourage the commercialisation of intellectual property by offering a reduced tax rate. The catch for us is that most require the intellectual property to have been created in the same country, meaning that companies looking to take advantage of these regimes are also likely to move their R&D into the same jurisdiction in order to meet the criteria.

These incentives are proving effective and have now been introduced in 10 countries globally including the UK and China, and the US has recently been seriously considering introducing its own. If we don’t come to the table Australia will be left behind and the entire innovation and manufacturing cycle will suffer.

That’s why we are working with industry leaders to push government to do something by introducing an Australian specific patent box: the Australian Innovation and Manufacturing Incentive. If introduced this measure will help to protect the future of manufacturing and export into the future.

*Barry thomas is the Vice President and APAC Managing Director of Cook Medical Australia. Barry has more than two decades of international leadership and expertise in the pharmaceutical and medical device industries and he currently spearheads the world’s fastest growing region for Cook Medical.

BaRRy ThOmaS Vp AnD ApAC MAnAging DirECtor of

Cook MEDiCAl AustrAliA

‘Australia

has some

real

competitive

advantages’

// 10// SEPTEMBER / OCTOBER 2015

chinA ftA

TPP in doubt, but Asian FTAs give exporters a big boost

T T P P TPP in hawaii has put the spotlight back on Australia’s recent Asian free trade deals.

fortunately, there are still plenty of opportunities for Australian exporters in the

world’s fastest-growing region, analysts say.

The latest export figures released by the Australian Bureau of Statistics (ABS) showed strong growth in Australia’s services, manufacturing and rural exports, “cushioning the impact of lower resource export earnings,” according to Trade Minister Andrew Robb.

Total exports amounted to $319 billion for fiscal 2015, with services

anThony Fensom

exports rising by 9 per cent to $63 billion, rural exports up 7 per cent to $43 billion and manufacturing exports increasing by 4 per cent to $44 billion. However, resource exports dropped by 14 per cent to $143 billion, resulting in total exports dropping 4 per cent on the previous year.

“With the end of the resources boom, Australia’s economy will need to transition to a broader growth base – increases in rural, manufacturing and services exports in 2014-15 indicate that this transition is already underway,” Mr

Robb said.“The conclusion of trade

agreements with Japan, Korea and China will enhance opportunities for broadening our export base, and underscores the importance of the Government’s trade negotiation agenda,” he added.

The latest DHL Export Barometer has also found exporter confidence is on the

rise, with the highest level of confidence since the global financial crisis. According to DHL, two-thirds of the nearly 600 Australian exporters polled expect orders to increase next year, with more than half seeing increased orders in the past year.

Exporters also showed strong backing for the recent Asian FTAs, with the latest agreement with Australia’s biggest trading partner, China (known

as ChAFTA) gaining positive expectations from 49 per cent of those polled.

The earlier deal with Japan, known as the Japan-Australia Economic Partnership Agreement (JAEPA) was found to be more beneficial than initially expected, with positive impacts cited at 41 per cent compared to the anticipated 35 per cent in 2014.

Concerning future FTAs, more than half (51 per cent) expected a positive impact from a deal with the European Union, •••

// 11// SEPTEMBER / OCTOBER 2015

chinA ftA

with confidence in the TPP also growing, up from 37 per cent last year to 46 per cent forecasting a beneficial outcome.

Comprising Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam, the TPP encompasses 40 percent of world gross domestic product (GDP) and a quarter of global exports, with a successful accord likely to become the world’s biggest multilateral trade deal in a decade.

According to the Peterson Institute for International Economics, a successful deal could boost world gross domestic product (GDP) by nearly US$300 billion a year, with exports of member nations forecast to grow by US$440 billion.

Yet while the future of the TPP is uncertain following the breakdown of the latest talks, ANZ says Australian exporters still have enormous opportunities to benefit from the growth of the world’s fastest-growing region, Asia.

“Many of the final hurdles to the TPP are bilateral in nature and the negotiations will continue on that basis around specific issues such as dairy, sugar and automobiles. Despite the various trade representatives appearing to be confident of an agreement being reached, multilateral agreements are notoriously difficult to bring to a conclusion,” ANZ’s chief economist Warren Hogan said.

The economist warned against attempts to renegotiate the China trade deal, which he said could

risk the nation’s Most Favoured Trading nation status. However,

should ChAFTA be ratified as expected, Australian exporters can expect major benefits from the growth of the world’s second-biggest economy.

“The Chinese market represents one of the most important opportunities for Australian businesses over the decade ahead. As China’s economy transitions from the investment-led industrialisation of the past two decades to a mature services-orientated consumer economy, the Chinese domestic market for a broad range of intermediate and consumer goods is expected to grow strongly,” Hogan said.

“By 2030, our projections indicate

that China’s urban disposable income (per capita) will almost quadruple, over 300 (million) new middle class members will emerge in China’s urban areas, and this new class of consumers will spend three times as much in 2030 as

they do now. We expect the automobile, telecommunications, housing, education, recreation and medical service industries to benefit most from the rise of the Chinese consumer, but nearly all industries will benefit in some way.”

With non-mining exports now crucial following the end of the mining boom, trade with Asia’s fast-growing markets could represent the best opportunity to ensure the Lucky Country’s dream run of economic good fortune continues. •••

‘The Chinese market

represents one of

the most important

opportunities for

Australian businesses

over the decade ahead’

Anthony fensom is an experienced business writer and communication consultant with more than a decade’s experience in the financial and media industries of Australia and Asia.

// 12// SEPTEMBER / OCTOBER 2015

This is the second major survey conducted by AIBS seeking the views of Australian companies from 19 industry sectors operating in 114 international markets.

The AIBS survey, supported by Austrade, the Export Council of Australia, Export Finance and Insurance Corporation (Efic) and the University of Sydney, is one of Australia’s largest and most in-depth investigations into internationally-active businesses.

This year’s survey confirmed that local culture, business practices and language remain the most significant barriers to doing business in some of the most difficult overseas markets for Australian businesses.

Payment issues, local regulations, product standards and tariffs were also cited as important barriers.

The level of the Australian dollar was the other single most important Australia-based factor identified by participants as limiting their ability to take advantage of international opportunities.

Australian businesses however remain optimistic and ambitious, with 76 per cent of participants indicating plans to expand to two or more additional countries over the next two years. •••

chinA ftA

Many exporters still struggling to understand FTAs: survey

A large percentage of Australian exporters have a limited understanding of

existing Free Trade Agreements with other countries, a major business survey has found.

Australia’s International Business Survey (AIBS) 2015 asked more than 1200 participants about their understanding of Australia’s Free Trade Agreements (FTAs) with other nations.

Though nearly 71 per cent of respondents said they exported to at least one market where an FTA was in operation, their detailed responses relating to individual agreements suggested that many do not fully understand the agreements or how they apply to their business.

In relation to seven trade agreements where AIBS 2015

asked a specific question, in no case did less than 40 per cent of respondents say they were uncertain about how and whether the relevant FTA would apply to their business.

This ranged from a low of 43 per cent in the case of the Malaysia-Australia FTA (MAFTA) to a high of 52 per cent in the case of the Australia-Chile FTA (AClFTA).

And a significant share of respondents did not know the FTA in question existed – ranging from nine per cent of respondents in the case of the ASEAN-Australia-New Zealand FTA (AANZFTA) to 18 per cent in the case of AClFTA).

“The survey results suggest that knowledge gaps regarding Australia’s existing portfolio of FTAs are significant,” researchers noted.

// 13// SEPTEMBER / OCTOBER 2015

chinA ftA

Coface’s top 10 tips for companies looking to expand into China As a global credit insurer, Coface is acutely aware of the amount of companies failing due to unpaid debts.

China is one of these markets – with non-performing loans up 97 per cent since 2011. As a result, Coface has placed an A4 rating on the risk of businesses defaulting.

But expanding in China can certainly still be done successfully, as long as business owners are diligent.

Chris Little, Coface’s commercial director in Australia, offers these 10

tips for companies seeking to expand into China and other Asian countries:

1. Clearly identify the entity you are dealing with. This can be challenging as there is no requirement in China for companies to lodge their financials with a regulatory authority

2. Do not rely, as many companies do, on trade references conducted over the phone or via email

3. Use a credit reference agency to gain deeper insight on the trade history of a potential customer

4. Take out credit risk insurance to protect you against payment arrears or non-payment of invoices

5. As part of this, use an experienced risk underwriter, such as Coface, to advise on setting of credit amounts for customers in different

countries and stick to them6. Use an on-the ground agent

to manage the relationship with partners as they will have a clear view of the local market.

7. If a long-term client is suddenly delaying payment this could signal a cashflow problem. It’s important to be in regular communications to ensure payment is not further delayed

8. Instil discipline with credit terms and the level of credit you are prepared to offer and do not be tempted to overtrade or offer extended credit terms

9. By having a Trade Credit Risk Insurance policy, companies can avoid letters of credit as they impact their cashflow

10. Operate within your means.

// 14// SEPTEMBER / OCTOBER 2015

* Chris Little is Coface’s commercial director in Australia

chinA ftA

Perfect climate for exporting – but tread carefully, warns Coface

Chris LiTTLe

Australian businesses are ideally placed

to export goods and services to their regional neighbours thanks to our strategic location, the depressed dollar, a rising middle class, and free trade agreements signed last year with China, Japan and South Korea.

Many Australian companies are looking to seize the expansion opportunities offered in the region – but they should be wary of overextending themselves in a bid to win business.

The payment experience of businesses in the Asia Pacific region is continuing to deteriorate, according to the latest Survey of Corporate Payment Trends in Asia Pacific conducted by Coface, one of the world’s leading international credit insurance providers.

As a result, Australian companies have been encouraged to adopt a more prudent and disciplined approach in the credit and payment terms they are offering customers.

The research points to the trend of companies taking tighter control of their credit management, with the number of Australian companies experiencing ultra-long overdue payments of more than 120 days that account for more than 2 per cent of turnover – the point at which this would hurt a company’s liquidity – has fallen from 23 per cent in the previous year to 17 per cent.

The report, which surveyed 2,695 companies

in eight Asia Pacific countries, states that 92.9 per cent of Australian companies offered credit terms to their customers two years ago – a figure which has since fallen to 81.9 per cent and there has been 12.6 per cent percentage drop in the number of companies experiencing overdue payments from their customers to 74 per cent of those surveyed.

In China things have moved in the opposite direction. Two years ago 86.4 per cent of Chinese companies offered credit to customers. This has now risen to 89.6 per cent. Only 30.1 per cent of the Chinese businesses surveyed offer 30-day average credit terms with the majority (58.3 per cent) offering between 60- and 90-day average credit terms.

In speaking with our Australian clients, as many as 70 per cent of them who do not already export to Asia are looking to take advantage of the growing Chinese market and expand into offshore exporting in the next 12 months.

It’s paramount business owners and financial controllers do not relax their credit management controls with extended payment terms.

Although it is a tempting scenario to appear competitive, this could actually weaken the business and stunt future growth. •••

// 15// SEPTEMBER / OCTOBER 2015

Why buying agents are big business in China

the China-Australia Free Trade Agreement (ChAFTA) will mark huge changes for Australian exporters to

China. Selling online in China will become

straightforward, allowing the simple shipment of goods through logistics providers or the procurement centre of an affiliated ecommerce market.

Despite these opportunities, the most popular Australian exports to China aren’t brands – they’re buying agents.

There are more Chinese web searches looking for Australian buying agents than those directly searching for Australian products.

The most-searched keyword associated with “Australia” was “buying agent,” according to data from Chinese search engine Baidu, from January to July 2015.

What is a buying agent?As opposed to resellers who are

authorised to trade on behalf of a brand, buying agents are unauthorised, purchasing goods on behalf of consumers abroad.

Buying agents typically post images of products on their personal social media such as WeChat and Weibo, offering to purchase Australian products in-store and post them to clients in China.

Buying agents have become big business, with over 4,670 buying agents in Australia advertising Australian products on WeChat or C2C e-marketplaces in China in July 2015.

Unauthorised buying agents made up

91.2 per cent of the 851,700 Australian products and services listed on Chinese e-marketplace Taobao.

how buying agents workThe buying-agent industry is well-

developed and is mostly run by international students or new immigrants who have friends or connections in China.

After buying agents receive the order and money from China, they purchase the products from one or more Australian supermarkets, pharmacies or boutiques, package the stock, and ship it to China via Chinese logistics companies.

Chinese consumers are turning to resellers to buy Australian goods because they are often the only method of buying these products. Only 47 Australian brands had flagship stores on China’s biggest e-marketplaces, with an additional 78 Australian brands sold through authorised Chinese online resellers on Alibaba-owned shopping platforms Tmall and Tmall Global.

Although buying agents are buying your products, their activities can harm your brand.

Buying agents can provide inaccurate information on your product, littering the internet with hundreds of variations on product translations.

The government can educate Australian businesses about these Chinese opportunities and propagate the values of ChAFTA but ultimately, the work falls down to enterprises.

It’s time Australian businesses regained control of their brand. •••

Benjamin Sun is

a director and

co-founder of

think China, an

australian agency

specialising in

digital marketing

and analysis to

help customers

access the Chinese

market.

chinA ftA

BeNJamiN SuN

// 16// SEPTEMBER / OCTOBER 2015

Japan, currently worth $1.4 billion. This includes a halving of the tariff on frozen beef from 38.5 per cent to 19.5 per cent, with deep cuts in the first year.

Cheese, by far Australia’s largest dairy export to Japan at $372 million, will gain significant new duty-free access. Australian horticultural producers will gain from immediate tariff eliminations across a wide array of fruit, vegetables and nuts.

The tariffs on canned products such as tomatoes, peaches and pears, as well as fruit and vegetable juices, will also be eliminated.

The beef industry, which is currently worth $1.4 billion in Japanese exports, will see the tariff almost halved from about 38.5 per cent.

This could see the beef industry grow by $2.8 billion in the next two decades, measured in current dollars, say analysts.

The tariff on frozen beef will be halved, from 38.5% to 19.5%, with deep cuts in the first year. The full fall is to take place within 18 years,

Historic Japan FTA opens new doors for Australian exportersthe Japan-Australia beginning of the year, will add billions of dollars to Australia’s economic growth over the next 20 years.

the historic Japan-Australia Economic Partnership Agreement (JAEPA) has delivered

a significant boost to Australian exporters and producers who were previously locked out of the impenetrable Japanese domestic market.

The new agreement has opened the door to exports of Australian beef, dairy, wine, sugar, horticulture and a range of services.

It also makes Japanese cars, cameras, televisions and other high-tech goods cheaper in Australia.

The agreement is the culmination of negotiations that started in 2007 under former Prime Minister John Howard.

major windfall for australian beefJAEPA represents a major

windfall for Australian beef – our biggest agricultural export to

JAPAn ftA

Tim miChaeL

// 17// SEPTEMBER / OCTOBER 2015

while a fall to 23.5 % for chilled beef is to be achieved within 15 years. There will be limits on how much beef can be imported into Japan.

Dairy exports set to soarAnd Australian exporters of

high quality sugar, dairy products including ice cream, yoghurt and natural cheese all stand to benefit from the free trade deal.

In dairy, where the Japanese have long maintained import quotas above which high import duties attach, Australia has been granted its own category effectively, taking its duty-free quota to 47,000 tonnes a year up from the current 27,000.

Cheese, Australia’s largest dairy export to Japan and worth $372 million, will gain significant new duty free access.

Natural cheese, which is used to used to make processed cheese such as cheddar or Colby, is a big winner in the deal as there will be immediate duty-free access to make processed cheese.

Tariffs for ice cream exports will fall by 50 per cent to between 14.9-10.7 per cent over ten years while the quota grows from 180 tonnes to 2000 tonnes, and frozen yoghurt tariffs will halve to 14.9 per cent in 10 years, with the quota doubling to 200 tonnes.

education another area of opportunityEducation is also an important

area of opportunity from the Japan-Australia Economic Partnership Agreement or JAEPA.

Japanese companies are increasingly aware that internationally capable graduates and staff are essential if they are to maintain their business and investment drive across the Asian region, particularly in ASEAN member countries.

And in financial services JAEPA guarantees cross-border access for Australian funds managers providing investment advice and portfolio management, and allows Australian financial services providers to participate in wholesale securities transactions with financial institutions in Japan, without necessarily having a presence on the ground.

It also permits off-shore processing of financial data.

Japan is Australia’s second largest export market and second largest trading partner. Two way trade was $69.3 billion in 2012-13, representing 11 percent of Australia’s total trade.

With a population of 127 million people and extremely limited natural resources, Japan has always been regarded as a jewel in the crown for Australia as its economy has been so protected.

Prime Minister Tony Abbott said JAEPA would give Australia a head start over our competitors in the lucrative Japanese market.

Bruce Gosper, CEO Austrade said the new agreement is “much more than just tariff reductions.”

The Australian Trade Commission (Austrade) is well-equipped to assist Australian exporters to grow their business in the region, he said. •••

FARMERS•Tariff cuts for wine, barley•Tariffs eliminated for sugar, cheese, horticulture, vegetable oils, seafood, honey

BEEF•Exports $1.4 billion in 2013•Sales up $5.5 billion over 20 years•Beef production up seven per cent•Frozen beef tariffs down to 19.5 per cent (cut of 19 percentage points)•Chilled beef tariffs down to 23.5 per cent over 15 years (cut of 15 percentage points)

DAIRY•Exports $511 million in 2013•Industry saves $4.7 million in first year; $11.6 million by 2031•Farmers gain 0.1 of a cent per litre over 20 years•Fresh cheese tariffs remain at 29.8 per cent

CARS•Cost of Japanese cars down by $1500 •No tariffs currently on Australian cars and car parts

MINERALS•Tariffs on all energy and mineral products eliminated within 10 years.

Japan-

auStralia

Fta at a GLaNCe

JAPAn ftA

// 18// SEPTEMBER / OCTOBER 2015

KoreA ftA

korea ftA opens door to new export opportunities

the comprehensive agreement with Australia’s third-largest export market, will open the door for new opportunities for a wide range of

small and medium business enterprises (SMEs), from service providers to manufacturers and producers.

Trade Minister Andrew Robb and Small Business Minister Bruce Billson, have encouraged SMEs to take advantage of these opportunities.

Under the new agreement which came into force late last year, 84 per cent of Australia’s merchandise exports to Korea, by value, now enter duty free, said Mr Robb.

This will rise to 99.8 per cent when the Agreement is fully implemented.

“The tariff outcomes for small to medium agricultural enterprises for example are substantial,” he said.

The agreement provides tariff cuts on commodities including beef, dairy, sugar, cherries, oranges, wheat and wine.

Hopefully, this will encourage more producers and manufacturers to seek-out opportunities in international markets.

Mr Robb said the agreement would enhance the competitiveness of our high end, small and medium size manufacturers, including parts and component producers.

Korea is for example a major market for Australian automotive parts and components, such as gear boxes, engines and other items. Korea’s 8 per cent tariff has been eliminated under the new FTA.

“The elimination of tariffs on Australian parts and

components will enhance the competitiveness of our high end manufacturers and open up new opportunities in this major market,” Mr Robb said.

Mr Billson said a variety of service providers will benefit from the Agreement, with new access for legal, accounting and telecommunications services.

Under the Agreement, Australia has committed to eliminating its remaining tariffs on imports from Korea.

“Lower tariffs mean cheaper business inputs, supporting competitiveness and profitability for our

small businesses and family enterprises,” Mr Billson said.

“Investment outcomes in KAFTA will also strengthen the ability of Australian businesses – large and small – to attract greater investment from Korea.”Some economists predict the

liberalised two-way trade could boost Australia’s economy by as much as $650 million a year in the next decade.

The agreement has created new opportunities for education and other export services.

KAFTA allows Australian law firms access to Korea’s legal consulting services market for the first time by permitting Australian firms to establish representative offices in Korea, and allows Australian lawyers to advise on Australian and public international law.

Within two years of KAFTA entering into force, Australian firms will be permitted to enter into cooperative agreements with local law firms, and within five years to establish joint ventures, and hire local lawyers.•••

small and medium businesses in Australia are being encouraged to explore ex-citing new export opportunities made possible by the new Korea-Australia Free Trade Agreement (KAFTA).

‘The tariff outcomes for small to medium

agricultural enterprises

are substantial’

// 19// SEPTEMBER / OCTOBER 2015

indiA

New opportunities for Australian exporters in India

BDO Executive Director of International Business Cameron MacMillan said

Australia’s construction and engineering sectors should look to India as a key export market as new opportunities emerge, particularly in roads, railways, ports and airports.

“The election of new Indian Prime Minister Narendra Modi in 2014, combined with positive economic growth, has contributed

to enhancing international business confidence,” Mr MacMillan said.

“Prime Minister Modi is known for his pro-business sentiment and willingness to further open the gates to international trade.”

Mr MacMillan said while the Indian government had put a renewed focus on infrastructure projects, there were specific opportunities for Australian exporters in the rail sector — partciularly in network

A heightened focus on infrastruture projects in india has created perfect conditions for Australian businesses looking to expand their international network.

and capacity expansion on both passenger and freight lines.

“Even more specifically, Australian experitse is soughtafter in certain areas, like heavy haulage,” Mr MacMillan said.

“As the demand for Australian skills and materials continues to grow in India, our capability in areas like modernisation, training, and skills development to support new expansions will be highly desirable.

Complex navigation“When it comes to trade, China

often rates highest on the radar — as do free trade partners like Korea and Japan — however India should also be front of mind for a lot of exporters of products and skills.”

With a free trade agreement with India on the table, Mr MacMillan said it would be beneficial to begin forming relationships now.

“Those thinking of going down that path need to be prepared, as India can still require some complex navigation and in some cases the rule of law is still very grey,” he said.

“I can’t emphasise enough the importance of getting to know a local partner or investigating the types of assistance that may be available to you from Australia.

“There are also a number of business negotiation practices and cultural considerations to take on board before engaging with the Indian market.” •••

// 20// SEPTEMBER / OCTOBER 2015

By thinking outside the square, a family-owned marine engineering

company based at Port Macquarie in northern NSW is achieving outstanding success on the world stage.

The Birdon Group has come a long way since its humbling beginnings as a small dredging company working out of a leased building on the Hastings River nearly 40 years ago.

The company recently started work on a $US261 million ($A318 million) six-year contract to supply specialty craft to the US Army.

It was the culmination of four years of design, tender submission and prototype trials.

The winning tender is based on a design Birdon developed for a contract a decade ago to supply similar craft to the Australian

army.Birdon CFO Tammy Bugler says

innovation and lateral thinking helped to get the company across the line.

“We are lateral thinkers and we encourage our team to look beyond the norm,” she says.

Tammy and her brother Jamie Bruce (Managing Director) now run the company, established by their father, Jim, in 1977.

The company slogan “Make It Happen” says it all.

“Dad originally started the company with the purchase of a single dredge, Ms Bugler recalls. “He used to extract sand from the Hastings River at Port Macquarie.”

He then expanded the company and moved into contract dredging, marine engineering, ship construction and repairs and maintenance. The rest, as they say, is history.

The company’s headquarters is now located on a 6ha site at Port Macquarie with operations in Sydney, Victoria, Queensland and the US. More recently, it opened a new sales office in the UK.

Birdon currently employs about 140 people – 90 in Australia and 50 in the US, based mainly at a new state-of-the-art manufacturing facility at Denver, Colorado.

Over the next six years Birdon will supply as many as 374 Bridge Erection Boats (BEBs).

The boats are manufactured in the US, with support from Birdon’s Australian team.

Bridge erection boats are used primarily to provide propulsion and manoeuvring thrust while supporting temporary floating bridges when existing bridges have been destroyed during a military conflict. •••

Port Macquarie’s Birdon Group making big waves in the US

usA

Making

waves in the

US: Birdon

Group Bridge

Erection

Boats

// 21// SEPTEMBER / OCTOBER 2015

Australian exporters should not rely on china for agricultural exports – but should also set their sights on the middle east.

australia should look to arab nations for meat exports

Jebel Ali

Freezone

project nears

completion

This is the message from the Australia Arab Chamber of Commerce

and Industry, which is keen to promote greater trade with Arab nations.

An AACCI delegation recently toured South Australia selling the export benefits of the Middle East.

During the tour CEO Suzannah Moss-Wright said Australia must not simply rely on China for a prosperous export future.

“Recently the Arab world has overtaken China as a larger export market for red meat – including sheep meat and beef chilled and frozen,” she said.

“We often hear so much about the trade opportunities with China but in fact the Arab world is surpassing China in terms of opportunities for red meat.

“This is a huge opportunity for Australian agriculture because we really do need to look at market diversification.”

Meat and Livestock Australia figures show lamb exports increased 11 per cent in volume and 30 per cent in value in 2014.

The top market was the United States, followed by China, the United Arab Emirates, Jordan and

The latest phase of a project to build a convention centre, offices, hotel and food court in Dubai’s Jebel Ali Freezone is nearing completion.

Named JAFZA (Jebel Ali Freezone Authority) CVC, the scheme is being constructed on a 72,700sqm plot, with a total built-up area of 370,000sqm.

ETA Engineering is carrying out the AED500m ($136m) MEP works and told MEP Middle East that phase two, which started in June 2013, is now 95 percent complete.

The third and final phase is due for completion at the end of August next year.

Overall, the project will consist of 34 storey twin tower offices, a convention centre with associated exhibition centre, a 600-seat auditorium and catering area, data centre as well as 322 room four-star hotel. It will be supplemented by four levels of parking.•••

OPeN SOON: JAFZA CONvENTION CENTRE

Bahrain.Mutton exports increased 8

per cent in 2014, with the top five markets China, Saudi Arabia, Malaysia, the US and UAE.

Lamb exports to Middle East and north African nations were worth more than $410 million, with mutton exports worth more than $250,000.

MLA beef figures show total exports increased 17 per cent globally in 2014, with the value increasing 36 per cent.

The top market was the United States, followed by Japan, South Korea, China and Indonesia.

Saudi Arabia was ninth, with the UAE 14th, Jordan 16, Kuwait 18, Morocco 21nd and Egypt 22nd.

Australia exported 60,249 tonnes of beef to the Middle East and north Africa in 2014; trade that was worth almost $390 million.

Twenty-two nations make up the Arab League.

Ms Moss-Wright said she wanted a greater governmental focus on Arab nations.

She said exports to the Middle East had been on a gradual, long-term increase in recent years, while China offered greater volatility. •••

middle eAst

// 22// SEPTEMBER / OCTOBER 2015

trAvel

new passenger plane can fly from new York to london in three hours

S supersonic jet that is set to become the world’s fastest airliner.

A US-based aerospace engineering and design firm has unveiled a new supersonic jet that is set to become the world’s fastest airliner.

Spike Aerospace say the S-512 Supersonic Jet is capable of hitting a supersonic cruising speed of Mach 1.6 (1,963 km/h) and a maximum speed of Mach 1.8 (2,205 km/h).

The dual-engine S-512 Supersonic Jet is designed to ferry 18 passengers between London and New York City in just three hours, flying 724 km/h faster than any other civilian jet.

The developers claim the S-512 is even faster and more exclusive than the SABRE engine that British aerospace firm Reaction Engines Limited says will take 300 passengers anywhere in the world in just four hours.

The concept was first announced in 2013, and since then, the team has been working on making the design as safe, fast, and cost-effective as possible.

“The past 18 months have resulted in significant improvements in all three factors and in a few additional areas like sonic boom, range, and comfort,” says the Spike Aerospace team.

They claim the new wing and tail designs will reduce wave drag and fuel burn, which in turn will increase the plane’s range during both low-speed flight and

supersonic cruise. Right now, its range is listed as 10,334km, and its maximum altitude is expected to reach 15,240km.

And Spike Aerospace says passengers travelling on the new jet between two of the world’s greatest cities can expect exceptional comfort and service.

Passengers can enjoy panoramic views, captured by cameras surrounding the aircraft as well as soft leather seating, reduced cabin noise and higher oxygen levels.

They can also expect dining tables and high-speed wireless Internet access.

The company has not yet announced the date of the maiden flight.

Nor has it announced the cost of travel.But with a price tag of between US$60 and $80 million

for each jet and only 18 passengers flying in it at any given moment, don’t expect any budget rates.

These flights will probably only be available to the likes of Saudi princes and rock stars.

But if or when the project actually gets off the ground, it could mean great things for future air travel as supersonic air travel becomes more cost-efficient.

“Flying supersonic is clearly the future of aviation,” says Spike CEO and President Vik Kachoria.

Let’s hope it becomes the only way to fly. •••

// 23// SEPTEMBER / OCTOBER 2015

trAvel

Qantas expands its services to JapanQantas has expanded its presence in Japan with the launch of double daily services between Australia and tokyo.

Australia’s national airline will operate flights from Sydney to Tokyo’s Haneda Airport as well as from Brisbane to Narita Airport each day.

Qantas International CEO Gareth Evans said the almost doubling of capacity to Tokyo marked a new era for the national carrier’s presence in Japan in the wake of a growing Australia-Japan travel market.

“This significant capacity expansion has been extremely well-received by Qantas customers and especially by corporate travellers heading directly to downtown Tokyo, who can now save up to one and a half hours on their airport commute by flying into or out of Haneda,” said Mr Evans.

Qantas’ Brisbane-Narita launch flights in August were operated by the airline’s refurbished A330 aircraft, with lie-flat seats in Business, new Economy seats and new inflight entertainment.

The refit of these aircraft, which takes one month each, is being done at Qantas’ heavy maintenance facility in Brisbane. These aircraft are being introduced progressively onto Asian routes.

To celebrate the launch of the new Japan services, customers onboard flights departing to Narita and Haneda and in Qantas International Lounges in Sydney and Brisbane were treated to Japanese-inspired menus for the first week of August, including Tuna Tataki Nigiri in Business, and Green Tea flavoured Kit Kats in Premium Economy and Economy.

The launch of double daily Qantas flights to Tokyo follows Jetstar’s introduction of its Boeing 787 Dreamliner on the Melbourne-Narita route earlier this year, increasing the available seats between the two cities by 20 per cent over the next year. The upgrade from Airbus A330 aircraft to the higher capacity B787 will be complemented by an increase in flights from four to six per week December to March to meet growing demand for flights between Melbourne and Japan in the peak season. •••

ShelfPack:

a neat way

to travel

If you hate unpacking clothes during short stays while travelling on business, ShelfPack provides an ideal solution.

This first-of-its kind roller suitcase is designed to save you the effort of unpacking, while ensuring your clothes stay wrinkle free.

Created by California’s McKaba Luggage, ShelfPack is as smart as it is stylish, with four internal shelves (and three zippered compartments).

Each shelf can be expanded or collapsed on retractable supports, keeping your clothing items flat, organized, and easily accessible.

It sounds like the perfect solution for short hotel stays — and almost as good as having a personal valet. •••

www.shelfpack.com

NO mORe WRiNkleS: ShElfPACk ROllER SUITCASE

// 24// SEPTEMBER / OCTOBER 2015

foreiGn exchAnGe

‘Compass

offers a morepersonalised

service’

AnDrEW su: ‘competitive rates’

need forex? Compass can point you in the right direction

Choosing a suitable currency exchange dealer can be a difficult task.

In a constantly changing economic climate it’s vital to find a dealer that not only provides competitive rates, but can also guarantee your funds will be safe and secure.

“It’s not always about finding the best rate,” says Andrew Su, Chief Executive Officer of Compass Global Markets, a boutique Sydney-based Forex solutions provider.

“All FX companies are trying to offer the best rates possible, he explains. “And though we offer highly competitive rates, we don’t want to follow that model.

“I’m not interested in going down to the lowest price … I’m more interested in reaching the highest standard of service.”

Compass Global Markets specialises in foreign exchange payments, hedging, and advisory.

The Compass team is largely from a corporate and institutional banking background focusing within the area of foreign exchange and commodity risk management.

Mr Su started his career at the CBA. He climbed the ranks to become Vice President, Hong Kong and Singapore in CBA’s Global Markets Division, before forming Compass Global Markets with his banking colleagues.

Mr Su and his partners recognized that the major banks were not adequately servicing smaller clients when it came to foreign exchange.

“Yet they were still charging customers what we considered to be excessive margins,” he says.

“We set up Compass because we wanted to offer better services than the banks within a much more cost effective structure for all our clients.”

Mr Su says Compass’ FX rates are much more competitive than banks as well as a superior standard of service, technical expertise and professionalism.

“Compass offers a more personalised service.”

Also, Mr Su says his company has a strong focus on Asia, which includes a dedicated China Desk with eight staff focusing on Chinese Yuan conversions.

And Compass not only moves capital, it also assists clients to manage their capital.

“We have now moved into capital raising and trade finance to provide a broader service,” says Mr Su.

Mr Su offers the following advice for exporters wanting to do business in China:

“Firstly, they should get up to speed with the new China FTA (Free Trade Agreement).

“And secondly they should be aware of the cultural differences and business practices.

“It’s all about education and partnering with the right people.” •••

For more information visit: www.compassmarkets.com

// 25// SEPTEMBER / OCTOBER 2015

finAnce & Business

Export grants vital for future trade growth: Robb

Grants assistance to Australian exporters is vital to their success in world markets, an independent review has found.

The Review of the Export Market Development Grants (EMDG) Scheme found that the grants help exporters to create, develop and expand their markets overseas.

Conducted by Mr Michael Lee, former CEO of Zip Industries, the review is the most comprehensive independent review of the EMDG to be conducted.

“Over 40 years the scheme has helped small and medium-sized exporters cover their promotional costs of expanding into international markets,” said Trade and Investment Minister Andrew Robb after tabling the report in Federal Parliament.

“Trade and investment are vital for the Australian economy, he said. “In 2014-15 Australia’s total exports were worth $319 billion. That represents a lot of jobs and a lot of GDP.”

The review concluded that Austrade should continue its current management of the EMDG scheme, which received funding of $137.9 million for 2015-16.

Consulting firm KPMG was also asked to analyse the net economic benefit of the EMDG scheme.

That report found that each dollar of an EMDG scheme grant generated an economic benefit of $7.03 when industry spill-overs and productivity gains were taken into account.

The Export Consultants Association Inc. (ECAI) commended Mr Lee’s report.

ECAI Chair Mr Rod Campbell said the review reinforces that the scheme is working well and contributing beneficially to the Australian economy.

Government funding is vital to encourage and sustain small and emerging exporters, Mr Campbell said.

“The evidence from the 188 public submissions

confirms the EMDG scheme, which has now operated for the past 40 years, has been the most successful economic stimulus initiative ever introduced into the Federal Parliament,” Mr Campbell said.

Key recommendations • The EMDG scheme be continued, and continue to

be administered by Austrade.• The ‘sunset’ provisions in the Export Market

Development Grants Act 1997 be removed.• The Budget allocation (in anticipating a 5 per cent

annual increase in the number of grant recipients) be progressively increased by $12.4 million per year over the next three years (2016-17 to 2018-19) to $175 million.

• That promotion of the scheme focus on lifting the number of applicants to the 10-year average of close to 4,000 per year in the near term, and on further growing the number of new exporting firms participating in the scheme over the medium term.

• That Austrade assess the long-term value of the EMDG scheme in promoting viable exporters beyond the eligibility period for grants, and report its annual findings to the Minister and industry. •••

Michael

Lee: EMDG

funding

should be

increased

// 26// SEPTEMBER / OCTOBER 2015

trade Marks examined: the ins and outsfrom iP Australia

iP - leGAl

the application process for registering a trade mark can seem complex.

So IP Australia has put together a summary of what you need to know when looking to apply for your trade mark. As they say “a business

without a sign is a sign of no business.”A trade mark is used to distinguish your goods and

services from someone else’s and is enforceable under intellectual property (IP) law.

Protecting your trade mark will protect the identity of your goods and services, and prevent others from imitating your brand!

So what is a trade mark?Any feature (or combination of features) that

distinguishes your goods or services from others can be registered as a trade mark. This can include a letter, number, word, phrase, sound, smell, shape, logo, picture or aspect of packaging.

A registered trade mark is legally enforceable. It gives you exclusive rights to prevent others from commercially using your trade mark. It also gives you the right to licence or sell it for the goods and services that it’s registered under.

Why would I need a trade mark?If you want to prevent others from using your

business name and/or branding in Australia you should register it as a trade mark.

Protecting your trade mark is extremely important as it protects your brand reputation and the goods and services that brand is applied to.

By registering your trade mark, you have the legal right to prevent others from commercially using your trade mark. You also have the right to license or sell it within Australia for the goods and services for which it is registered.

A trade mark is protected in all Australian states and territories for an initial period of 10 years.

How much does it cost?In general, the minimum cost to register a trade mark is

around $400 ($120 to apply for each class and an additional

‘a registered trade mark is legally enforceable’

// 27// SEPTEMBER / OCTOBER 2015

iP - leGAl

$300 per class when it is accepted).

Registration lasts for 10 years from the date of the application.

The costs will vary depending on how broad the protection you are seeking is. Goods and services are grouped together in classes (e.g. clothing, footwear and headgear is in one class, whereas software is in another class). The more classes of goods/services in an application, the greater the fees.

How long does it take?Your application will generally take three to four months to

be examined from the day they are filed.All trade mark applications are examined and if accepted,

there is a two month period in which they can be opposed. Opposition allows anyone to challenge the rights you are seeking.

How do I register?Before you commit to registering a particular trade mark

you can conduct a comprehensive search at Australian Trade Marks Online Search System (ATMOSS) to make sure the trade mark you want to use is available. This search will provide you with both registered trade marks and trade marks that have already been applied for.

You can also use TM Headstart (pre-application service) – a service to assess the potential registrability of the trade mark before you file an application.

To register your trade mark you need to file an application. This can be done online through eServices.

An important tip before applyingIt is important to make sure what you want to trade mark

doesn’t already exist. If you’re considering applying for trade mark protection and securing your own slogan or brand name – TM Headstart (pre application service) is a great place to start.

You can lodge a TM Headstart (pre-application service) for $120 and have a trade mark examiner do a check on your behalf.

Alternatively, you can do your own search on ATMOSS, before investing in a name for your business or product.•••

“a business without a sign is a sign of no business’

// 28// SEPTEMBER / OCTOBER 2015

For a detailed quote Ph: 1300 887 612 or salesaus@cffworld.com

Air Fright | Sea freight | Railroad | Custom Clearance | Freight Consulting | Specialised cargo www.cffworld.com

one stop shop: A freight forwarder for changing times

freiGht

Finding the right freight forwarder can be a big challenge for exporters and importers.

It’s often the key to export success.A freight forwarder doesn’t actually move freight,

but acts as an intermediary for their clients and various transportation services – by land and by sea.

A reliable and efficient freight forwarding service can save valuable time, with fewer headaches for clients – and can deliver significant cost savings.

Change Freight Forwarding + Consulting (CFF) is an international freight forwarding company with a difference.

Founded in 2006, it is a one stop-shop, specialising in air and sea freight, rail and road, customs clearance and freight consulting.

CFF has developed a unique model for international trade, freight forwarding and logistics services.

It offers cutting-edge technology to provide reliable and cost-effective supply chain solutions for the movement of cargo worldwide.

Its slogan One World One Solution says it all.With a complex and constantly changing industry,

international trade logistics is a rapidly growing and highly regulated industry.

CFF works closely with its clients to tailor the most efficient way to move import and export freight.

Freight can be booked on a variety of modes, including ships, airplanes, trucks, and railroads. CFF assists in the processing of all the documentation

associated with transferring a client’s goods.This includes commercial invoices, shipper’s export

declarations, bills of lading and any other documents required by the carrier or country of export or import.

And CFF can arrange finance and longer payment terms for approved clients.

“We conduct business with the best suppliers who have similar values to us,” says company CEO Hubert Igbnoba.

“We offer a more customised and personal service than many of the larger companies. We see our customers as our partners … they are not just a number.

“We try to find the best options for every logistics transaction as a priority.”

Mr Igbnoba’s advice for importers and exporters when choosing a freight forwarding company is to always request a detailed quote.

“If there is any part of that quote you don’t understand, you should always ask for a full explanation.”

CFF exports from Australia to key global trading regions including Asia, Middle East, Africa, US, UK and Europe.

And CFF can facilitate door-to-door pickup and delivery, to and from anywhere in the world.

Tim miChaeL

for more information or a detailed quote contact Change freight Forwarding on ph: 1300 887 612 www.cffworld.com

// 29// SEPTEMBER / OCTOBER 2015

How eCargo can open the door to China

Gaining access to China’s highly competitive eCommerce market can be a daunting experience for many Australian eTailers.

Now, eCargo, a China-based eCommerce solutions provider, can help you to grow your business in the world’s second largest economy.

eCargo acts as a unique “one-stop enabling partner” for designer fashion, branded apparel and retail companies seeking to sell their products online in China and globally.

The company provides integrated online and offline technology and supply chain solutions to Australian companies seeking to launch or strengthen their presence in China’s lucrative eCommerce market.

Though primarily focused on the China and Hong Kong market, eCargo also provides services internationally, including South Africa, the UK and Europe.

The company is ideally positioned to capitalise on the inexorable growth of the global eCommerce economy – projected to reach a turnover of US$4.2 trillion by 2016.

eCargo has an impressive client list that includes Esprit, Jeanswest, Karen Millen, La Perla, Lane Crawford, Invictus Watch, MEI.COM, Myer, Nelly.com, New Look, New Zealand Post, Sass & Bide, Super Retail Group, The Warehouse Group and NLY Scandinavia.

It offers five key service capabilities to merchants who enter the China and Hong Kong eTailing market:

• eFulfillment (including inventory intake, sales handling, inventory storage, courier management and coordination and other value-added services)

• eOperation (to manage and operate the online business for merchants)

• eCommerceIT (providing online retailing end-to-end transactions on behalf of merchants as well as project management and programming

resources for eCommerce IT platform localisation and implementation in China)

• eSupport (this includes digital photography and other services to enhance the brand’s identity and increase conversion in online sales).

• eMarketing (assisting merchants in their brand entry strategy and positioning in China).

eCargo connects merchant’s brands to the online customers through the development and marketing of brand site transactional platforms in China, and on Alibaba Group’s Tmall, Tencent’s, WeChat and JD.com.

eCargo successfully listed on the Australian Securities Exchange on November 28, last year.

Board members include:• Mr John Lau (Executive Chairman and Founder) • Mr Christopher Lau (Chief Executive Officer)• Mr Rupert Myer (Non-Executive Director), Deputy

Chairman of Myer holdings limited. • Mr Heath Zarin (Non-Executive Director) Managing

Director and founder of EmergeVest, a hong kong based private equity firm.

• Mr Chris Ryan (Non-Executive Director) CEO of Investorlink Corporate limited, a Sydney-based corporate finance and advisory firm. •••

e-commerce

Focus on China:

John Lau (left)

and Christopher

Lau

// 30// SEPTEMBER / OCTOBER 2015

Tim miChaeL

In a career spanning more than two decades, Jane has certainly done the hard yards.

But her dedication and commitment to her craft has paid off in spades.

The stylish Jane Ramsay fashion label can now be found in leading fashion outlets around the world.

Jane specialises in creating unique clothing, which not only appeals to customers within Australia, but also in the US, France, Mexico, Hong Kong and New Zealand.

She spent the early days of her fashion career in Los Angeles forecasting fashion trends and searching for fashion collections that would appeal to customers in Australia. During this time, Jane identified a need for genuine design in Australia based on her individual perspective of fashion – design that did not replicate collections from other countries.

Seven years and a business degree later, Jane developed her own collection and launched Jane Ramsay. Simple, stylish, flattering, and feminine, her clothing line has a place in every modern woman’s wardrobe.

Jane Ramsay defines the look that not only moves easily through the multi-facets of daily life, but appears effortless and is high on style.

“Life is not about finding yourself, but about creating yourself. My style has always been my own edit and my own take on fashion,” says Jane.

Business challenges For Jane, fashion is a global pursuit

and the success of her label relies heavily on the ability to connect her collection with international shoppers.

From the beginning, Jane built her business with the objective of providing her exclusive designs to customers locally and globally, particularly those based in North America – the world’s largest e-commerce market.

Jane understood the global fashion industry and knew where her targeted customers were located around the world, but she found the complex logistics management and regulatory environment daunting.

She sought to engage a global logistics provider to help her overcome these challenges as well as provide a seamless service.

As a web retailer, Jane faced another hurdle – building customer trust. “At a time when the label was relatively unheard of, conveying the quality of my collections and gaining early consumer confidence was crucial,” says Jane. “Products need to arrive on-time and in a flawless condition. I also developed a clearly defined returns policy so that if an item needs to be returned, exchanged or refunded it can be easily managed.”

savvy Melbourne fashion designer finds key to export successit’s a long way to the top if you want to knit and sew – just ask melbourne-based fashion designer, Jane ramsay.

“Life is not about finding yourself, but about creating yourself. My style has always been my own edit and my own take on fashion,”

JaNe RamSay: gloBAl suCCEss

fAshion

// 31// SEPTEMBER / OCTOBER 2015

Efficient, simple shipping solutionsJane attributes much of her label’s success to the

dependability and trustworthiness offered to her FedEx, a well-known international shipping company.

FedEx provides fast and reliable express delivery and air freight services to more than 220 countries and territories – and has a well-earned reputation for its support of small-and-medium-sized enterprises (SMEs).

The team at FedEx worked closely with Jane to offer a tailored service aligned to her business strategy.

According to Jane, the ‘good old fashioned relationship building’ she experienced with her FedEx representative Kenneth Laker helped shape the growth of her brand.

Jane recalls her first meeting with Kenneth at a local coffee shop.

“FedEx has been tremendously important, particularly in those early days when I really thought I’d made a serious error in judgment starting the business following the Global Financial Crisis at a time when customers were unreceptive to buying from an untested label.

“In those days my office was an extension of my daughter’s bedroom. To have someone return my calls promptly, to be able to put a face to a name and for someone to take the time to meet with me was invaluable.”

FedEx listened and understood Jane’s challenges. FedEx solutions gave her transparency in terms of cost and effectively managed her specific supply chain needs. By working with Jane to understand her concerns, FedEx tailored an individual approach and provided workable solutions, which alleviated her concerns and allowed her to bring her designs to life.

Now more than ever online retail presents a wealth of opportunity for Australian SMEs to reach customers in international markets.

In a quickly changing marketplace, the challenge now is to meet evolving customer expectations.

“As an online retailer, meeting my customer’s shipping needs is key to successfully growing my business,” says Jane. •••

fAshion

// 32// SEPTEMBER / OCTOBER 2015

loGistics solutions

The keys to successful food export to Asia

DaviD ruBie

The rise in the Asian middle class presents enormous opportunities to exporters globally.

While makers of high-end lifestyle products may be some of the most obvious beneficiaries of the increasing affluence and changing tastes across Asia, the opportunities for Australian food and beverage exporters are only just being realised. China alone has a population of

over 1.3 billion and is the world’s largest consumer market for food and beverage (F&B) goods, surpassing the US in 2011. According to a recent study

conducted by The Economist, China is the second fastest growing F&B market in Asia, with an average annual growth rate of 30 per cent in the past five years, according to China’s Ministry of Commerce.Not only is food consumption

across Asia, including China, growing faster than anywhere else in the world, but these nations are also experiencing increasing exposure to Western society and its new varieties of foodstuffs. As a result diets throughout the

region are changing. For example in South Asia, the

consumption of milk and milk products is expected to increase

by 125 per cent by 2030. This presents opportunities for

Australian primary food producers, in particular those involved with meat and dairy exporting.Research undertaken by

Austrade recently showed there is strong market demand in Asia for Australian suppliers of milk powders (including infant formula), UHT and pasteurised milk, cheese and butter, seafood, chilled or frozen meat, fresh fruits as well as processed foods.While there is rising demand

for an increased variety of food products across Asia, many countries are not equipped to actually produce the products themselves. Reasons include not having a properly skilled workforce to produce artisan products like speciality cheeses, or not actually having the farmland required to produce the quantities of livestock, fresh fruit or vegetables needed to meet local demand. A lot has been written in the past

about how Australia has a unique opportunity to become the food bowl for Asia. With vast tracts of fertile farming

land and skilled workforces, in theory the opportunities for primary food producers in Australia to export to Asia have

never been greater. However, just because there may be a growing market for foodstuffs from Australia across the Asia region, it doesn’t mean that every food producer in the country will automatically become a successful exporter overnight. The reality is that Australian

food producers face increasing pressures to get their products to market in Asia in a timely manner, along with ensuring that they meet regional food safety requirements. For Australian farmers and food manufacturers it is vital that they move away from manual low-tech processes across their supply chain and towards automation. In such a competitive consumer-

driven market it is vital for Australian food producers to get the right product in the right quantity at the right time to retailers across the region. Grocery distributors and the wholesalers they work with are less tolerant of missed delivery windows or being sent incorrect products that lead to out of stock store shelves. This can in turn lead to penalties

being handed to grocery distributors for late or incomplete deliveries. Australian food producers need to get goods out of their storage facilities

// 33// SEPTEMBER / OCTOBER 2015

loGistics solutions

David rubie is Manager at Industry Logistics at Dematicwww.dematic.com.au

or warehouses and through the supply chain as quickly and accurately as possible, especially in the case of fresh produce export, so that orders are successfully completed. To increase the productivity

of a food producer’s supply chain, technologies such as voice automation should be considered to support the food product “picking” process within a distribution centre. voice users report productivity

improvements well above 20 per cent, depending on the systems that voice replaces (paper/label systems or handheld scanning). Voice technology increases productivity by making workers more efficient as they no longer need to spend time writing manual reports or scanning a bar code or keying in data on a mobile computer. By eliminating the need to read a

display screen, a paper pick list, or a purchase order, workers obtain their next task en route to the next location, thereby reducing downtime while travelling within the facility. This offers a large increase in a business’ throughput and therefore profits. The ability of voice systems to

deliver picking accuracy in excess of 99.99% also means that the correct food orders are processed for export more often which in turn means that there are fewer returns and credits to process, resulting in a much higher level of customer satisfaction.And logistics providers who

are able to offer comprehensive

traceability throughout their operations will prove most attractive to advanced Asian food retailers. In order to do this, logistic providers should aim to increase capability in meeting local and international standards, through the use of technologies that facilitate real-time information such as 2D barcodes and smart labelling or RFID. Advanced barcode and RFID

technologies arm Australian food producers with a range of solutions that can be used to create modern labels that detail the date, and individual planted field where an item was picked. The availability of this kind of

label that follows a product at every stage along the supply chain, offers enhanced accountability and in the case of any food safety scares places regulators in a better position to pinpoint the source of pathogen outbreaks much faster. This greatly reduces the scale of what must be recalled, saving millions

of dollars in losses for farmers and lessening the stress for concerned consumers.As the food industry grows and

becomes more competitive across Asia, local food producers will be presented with new opportunities and new challenges. The key question for Australian food producers is what technologies they can implement within their business that will drive efficiencies and help ensure that they get their goods to export markets as rapidly as possible. Food producers who make an

investment in modernising their businesses with technologies, such as voice solutions or barcode and RFID systems, will be much better positioned to meet regional export standards and regulations. They will also be able to get their products to market sooner, which will support their opportunities to grow their bottom line. •••

// 34// SEPTEMBER / OCTOBER 2015

whAt’s on

SePteMber 9

LOCaL eVeNtS

SePteMber20-23

OCtOber 6

OCtOber 7

OCtOber 28

OCtOber 30 - NOVeMber 1

SePteMber 10

SePteMber 15

Series 2015 Host: AustradeWhere: National Wine Centre of AustraliaExhibition Hall Cnr of Botanic & Hackney RdsAdelaide Ph: 13 28 78www.austrade.gov.au/events

Where: Sydney ShowgroundSydney Olympic ParkPh: 03 9261 4500www.divcom.net.au

Where: Brisbane Convention & Exhibition CentreMerivale StSouth BrisbanePh: 03 9261 4500www.divcom.net.au

Host: AustradeWhere: Level 16307 Queen StBrisbanePh: 13 28 78www.austrade.gov.au

Where: Brisbane Convention & Exhibition CentrePlaza BallroomSouth Bank, BrisbanePh: 07 3514 3134www.tiq.qld.gov.au/awards

Where: The Star80 Pyrmont StPyrmont, SydneyPh: 02 9251 6492www.exportawards.com.au

Host: German-Australian Chamber of Industry & CommerceWhere: International Chamber HouseConference Centre L5121 Exhibition CentreMelbournePh: 03 9027 5618www.australia-germany.com

Host: Department of IndustryWhere: ANU Commons Building – Function RoomGround FloorCnr Barry Drive & Marcus Clarke StCanberraPh: 02 6125 0228www.industry.gov.au

1

2

China eCommerce

Seminar

Fine Food Australia

Trade Show

Good Food Show

EMDG Coaching/

Information Session,

Brisbane

Premier of Queensland

Export Awards 2015

Premier of NSW Export

Awards 2015

Australia-Germany

Business Conference

Industry & Innovation

Workshop

// 35// SEPTEMBER / OCTOBER 2015

INterNatIONaL eVeNtS

SePteMber 17-19

OCtOber 7-10

OCtOber 27-30

NOVeMber 11-13

NOVeMber 5-7

OCtOber 27-29

SePteMber 17-19

OCtOber 13-16

SePteMber 29 – OCtOber 2

OCtOber 15-19

OCtOber 1-4 OCtOber 18-22

Where: Shanghai New International Expo CentreHost: China Council for the Promotion of International Tradewww.chinaexhibition.com

Where: Resort Mundo Imperial, AcapulcoHost: The Mexican Association of Mining Engineerswww.expominmexico.com.mx/en

Hosts: HKTDCWhere: Hong Kong Convention & Exhibition Centrewww.hktdc.com

Where: Shanghai

Where: Shanghai

www.fhcchina.com

seafex (professional seafood show)speciality food festivalsweets Middle EastWhere: Dubai World Trade Centre

www.gulfoodmanufacturing.com

www.seafexme.com

www.specialty.ae

www.sweetsmiddleeast.com

Where: Shanghai New International Expo CentreHost: China Council for the Promotion of International Tradewww.chinaexhibition.com

Where: Hong Kong Convention & Exhibition Centrewww.hktdc.com

Where: Kuala Lumpurwww.foodandhotel.com

Where: Guangzhou, Chinawww.cantonfair.org.cn

Taiwan 2015Where: Taipei, Taichung & KaohsiungHost: AustradePh: 02 8758 4208www.austrade.gov.au

Where: Dubai World Trade Centrewww.dwtc.com/en/events

5

9

2

3

4

China International

Nutrition & Health

Industry Expo

Expo Min Mexico 2015

Mining Exhibition

Hong Kong International

Lighting Fair

FHC China 18th

International

Exhibition for Food,

Drink, Hospitality,

Food service, Bakery

ProWine China

International trade

fair for wine & spirits

Hong Kong

International Wine &

Spirits Fair

Gulfood Food

Manufacturing Show

China International

Medical Equipment

Expo

Hong Kong Electronics

Fair

Food & Hotel Show

Malaysia

Canton Fair

China Import & Export

Fair Complex

Australia Future

Unlimited Education

Exhibition

GITEX Technology Week

whAt’s on

Hosts: HKTDC, Wine AustraliaWhere: Hong Kong Convention & Exhibition Centrewww.wineaustralia.com

www.prowinechina.com

// 36// SEPTEMBER / OCTOBER 2015