Year-End News And Product Updates

Our forecast for manufacturing

The general push to bring more production back to Australia is prompting some non-automated manufacturers to start thinking about investing in automation. And while automation isn’t the only answer, it helps enormously but must be supported by other incentives or initiatives to be truly competitive.

A hard truth is that our manufacturing costs, especially labour, are too high to allow us to be competitive globally in mass produced products. Our domestic market isn’t big enough to support these industries on its own. We need to concentrate on niche areas where we can do well both locally and internationally. If anything, the pandemic has prompted emergence of many niches, especially when manufacturers have had to pivot their production lines or end-products. In those cases, we’ve been able to help with re-tooling or automation across quite a range of situations, even for smaller or highly specialised businesses.

Sadly, the Federal Budget initiative falls way short. The commitment to a ‘Modern Manufacturing Strategy’ is headlined by $1.5 billion beginning in 2021 but spread over annual funding rounds for the next four years. See the Government’s announcement for details. We like the brief analysis from the AU Manufacturing news article that recaps some ‘real cost’ implications. One saving grace has been the $150k tax incentive for investment in equipment which has helped make automation more accessible. Instant asset write off was extended to 31 December 2020.

Freight and Supply Update

Freight pricing has risen considerably due to shortage of aircraft and delays are much more frequent than pre-Covid. Bulk freight by air is currently more expensive than express freight.

Our suppliers across the globe are mostly shipping on time despite many of their staff working from home. All follow tough Covid-Safe protocols.