The world has become increasingly connected through massive increases in trade and cultural exchange. We have the ability to source internationally at reduced cost, accessing markets with lower wage costs and fewer industry regulations, resulting in goods and components at reduced prices. Larger cargo ships mean that the cost of transporting goods between countries has decreased. Economies of scale mean the cost per item can reduce when operating on a larger scale.
With economic globalization comes social and cultural changes in parallel. It brings with it an exciting array of options like international cuisines and new technologies, introducing new products to the market and keeping design influences fresh.
That said, the benefits of buying local are not to be overlooked.
A supply chain that relies too heavily on international sourcing can leave us exposed, something we have recently learned in haste. The current global pandemic sees us in unprecedented times, and while freight routes have remained mostly operational, the shutdown of industries across countries globally has limited our access to what we need and highlighted the importance of supply chain sustainability. That is where sourcing from local supply has become more important than ever.
Domestic sourcing provides greater supply chain control and flexibility. Not to mention the environmental benefits of domestic sourcing including lower emissions and a reduction in carbon.
There is greater ability to be proactive. Market trends can rise slowly or appear (or disappear) in a minute. When your supplier is local, you can have a flash of insight and have it actionable within days, without being locked to large stock holdings or shipping times.
While the ‘buy-local’ mentality is nothing new, now more than ever it is viewed as a tangible way to make a difference to what is happening in our communities right now. Buying local helps to build thriving communities, with a significantly larger portion of the money remaining in the local economy.
The longer the supply chain, the less money that goes to the people that actually produce the goods or service. Shortening the chain is better for both producers, consumers and results in stronger community relationships.
The argument can be made that the introduction of new product is one of the most vital benefits of importing, and importing can actually support the local economy through services such as shipping, transportation and distribution. There will remain an appetite for well-designed, high quality products that we don’t have the ability to produce efficiently on-shore. But let’s not forget, we are a nation of innovators with an exceptional design community. We don’t need to look far to find product diversity and uniqueness.
There is growing momentum behind ‘NZ Made’ and ‘support local’ and it creates an incredible sense of community as we face tough times and look for ways to rally together. Buying local today can feel like a positive and tangible action that we are able to take, our way to affect positive change. We are also faced with the unique ability to choose what we take away from this experience, and what we place value on moving forward.
The reality is that in New Zealand we rely on a mixed model. Our smaller market size means we often rely on imported components to compliment NZ Made offerings. The COVID-19 crisis has seen many New Zealand businesses swiftly and creatively adapting to produce resources we need domestically. For example, brewers producing sanitizer locally. Only to then face a challenge in sourcing the pump mechanism for dispensing, which would typically be an imported component. When one vital part of the supply chain is missing, it can cause the entire process to fall over, leaving us vulnerable.
We need to be smart in our supply chain management and contingency planning, and quick to act. And to embrace our kiwi ingenuity, to find creative and efficient solutions at times when the plan deviates from the norm.