Planning for a country of six million

The Centre for Supply Chain Management (CSCM) hosted EY Partner Chris Money on 3 November to talk about a key issue high in the minds of supply chain people after the Ports of Auckland Annual Report came out last year.

In this webinar, Chris spoke to the issues that we face in logistics in the Upper North Island (UNI) and how they can be addressed. The UNI supply chain is key to New Zealand’s growth and also minimising its growth penalties, with our distance to market already imposing around 10 percent on GDP.

Chris explained that an important factor in supply chain decision making was New Zealand’s faster than expected population growth, which passed five million in March 2020. For example, Tauranga had a massive departure from 2014 projections when its population increased by about 20% more than predicted numbers. This has a significant impact on New Zealand logistics and supply chain from a planning and funding perspective, as the projections are the basis on which infrastructure is planned.

In other words, New Zealand is funding its infrastructure far later than the actual needs of its population and is failing to create a supply chain that can serve the needs of the population. He also mentioned other important factors, such as land use and the value of certainty and signalling.

Finally, he emphasised the importance of timing in supply chain decision making and the fact that we cannot afford to make the mistakes we are making. COVID-19 might have given the transport and logistics sector some much-needed breathing space, but we should be aware that the same issues will come back harder. We should make sure that we have the courage to set the strategy, nerve to hold the course, and awareness to understand the gains and consolidate success.
You can watch this presentation and find the slides on our website.

Chris Money is a partner at EY and an economist and strategic adviser who has advised on several major New Zealand road, rail and port projects.