SCAN High assurance, light touch at the border - GS1 New Zealand

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SCAN High assurance, light touch at the border - GS1 New Zealand
SCAN
 ISSUE 38 NOVEMBER 2014     GS1NZ.ORG

                            High
                      assurance,
                   light touch at
                      the border
                            Interview with Carolyn Tremain
                                  – Comptroller of Customs

                      PRODUCTFLOW
                      ROLLOUT                         5

                      EASTPACK’S EPC/RFID             7

                      BIG IDEAS                       8

                      MITEK ON GS1NET                16
SCAN High assurance, light touch at the border - GS1 New Zealand
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SCAN High assurance, light touch at the border - GS1 New Zealand
GS1 NEWS

                                                    Global connection
                                                    by the numbers
                                                    Like it or not, New Zealand is increasingly
                                                    part of a highly dynamic global economy.

 It’s a simple fact evident in headline numbers         on www.gs1nzconnect.org. I encourage everyone            More immediately, companies in two New
 most days – Global Dairy Trade index prices,           to experience some of CONNECT 2014 online                Zealand export industries are making progress
 statistics on growth in migrants settling here         and to help keep the discussion going.                   with the GS1 standard for radio frequency
 from overseas, the monthly merchandise trade                                                                    identification (Electronic Product Code, or EPC/
                                                        GS1 New Zealand certainly will because global
 surplus or deficit and so on. They are constant                                                                 RFID) as also reported in this SCAN (page 7).
                                                        connectedness is actually our business. GS1
 reminders that global connections are what                                                                      EastPack has again in 2014 proved the benefits
                                                        Standards for globally-unique identification,
 drive New Zealand’s economic performance and                                                                    of EPC/RFID in its post-harvest operations that
                                                        data capture and sharing, and supply chain
 ultimately determine our standard of living.                                                                    are central to kiwifruit exporting, while meat
                                                        management are key enablers for much of the
                                                                                                                 processor ANZCO Foods has engaged with
 Obviously then, we must build and maintain             trade and information exchange mentioned
                                                                                                                 supply chain partners on a trial of the standard
 the strongest possible connections with the            above. Our numbers do not make headlines
                                                                                                                 for authentication of Halal-accredited products
 global markets and trading partners that offer         but, through their usage in thousands of ways
                                                                                                                 into the Malaysian market.
 most advantage to this country. And for this,          each day, they are also drivers of New Zealand
 we simply must have efficient, timely and              performance in the global economy!                       New Zealand has always been a small country
 meaningful exchanges of information and                                                                         dependent on international trade and capital.
                                                        This SCAN takes that theme further by
 knowledge that support growth and diversity                                                                     Globalisation has made that more a reality
                                                        interviewing Comptroller of Customs Carolyn
 in our international trade, and that attract the                                                                than ever before – and exposed us to greater
                                                        Tremain on New Zealand’s advance in border
 products, people and capital needed so much                                                                     opportunities and threats than ever before.
                                                        management and trade facilitation. Our world-
 by New Zealand.                                                                                                 The implications flow through New Zealand’s
                                                        leading Trade Single Window employs the
                                                                                                                 economy, well beyond those directly engaged
 These were the ideas behind GS1 New Zealand’s          new global standard for data formatting by
                                                                                                                 in exporting and importing. Businesses and
 CONNECT 2014 one-day conference in August              customs agencies and this, in turn is designed
                                                                                                                 government agencies need to think globally,
 – our modest push for more “big picture”               to leverage GS1 identifiers. Our border control
                                                                                                                 and to embrace tools that strengthen our
 discussion on current issues for New Zealand           agencies increasingly use the same data as
                                                                                                                 most advantageous global connections.
 in the global economy. We asked: “what’s next?”        supply chain partners to speed-up trade
                                                                                                                 GS1 New Zealand is ready to help wherever
 in connection to China; how do we capture              clearance processes and to sharpen their focus
                                                                                                                 we can.
 more value from our trading relationships?;            on specific areas of risk.
 and how do we stimulate more New Zealand
                                                        In fact, New Zealanders generally are becoming
 business innovation on the world stage?
                                                        more aware of the advantages, actual and
 CONNECT 2014 attracted a powerful line-up              potential, from using global data standards to
 of international and New Zealand speakers              streamline business processes at home and
 (including executives from two of our most             to facilitate global connections (current or
 accomplished international companies, Fonterra         future). We note (page 4) that the New Zealand
                                                                                                                 Dr Peter Stevens
 and Xero). A great day of thinking global!             Business Number (NZBN) is being extended
                                                                                                                 Chief Executive
                                                        as a GS1-based form of identification for every
 Six big ideas from the conference are reported
                                                        form of business, with far-ranging benefits to
 back in this issue of SCAN (pages 8, 9) – and
                                                        our economy over time.
 you can see and hear more from the speakers

                            SCAN magazine is produced twice yearly for the benefit of GS1 New Zealand     Unless otherwise indicated, articles appearing in SCAN may be
                            members. It has a circulation of approximately 5,700 readers throughout the   reprinted provided that GS1 New Zealand is acknowledged.
GS1 New Zealand             country as well as 101 GS1 member organisations worldwide.
PO Box 11 110                                                                                             For editorial or advertising enquiries please contact:
Wellington                  SCAN reaches decision-makers in a wide range of industry sectors              Pauline Prince on 04 494 1067 or pauline.prince@gs1nz.org.
T +64 4 494 1050            including grocery, FMCG, healthcare, logistics, manufacturing, retailing,     Advertising rates are on our website at
  0800 10 23 56             wholesaling and transport. Our readership includes chief executives,          www.gs1nz.org/news-and-events/scan-magazine/
F +64 4 494 1051            sales and marketing managers, account managers, brand and product             For copies of SCAN: If you are a member and would like more
E info@gs1nz.org            managers, IT personnel, operations managers, production managers,             copies of SCAN, or if you are not a member and would like to
                            logistics and supply chain personnel, bar coding staff and packaging          subscribe, please contact Bev Gough on 04 494 1050 or
                            coordinators.                                                                 bev.gough@gs1nz.org

 ISSUE 38                                                                                                                                              GS1NZ.ORG          3
SCAN High assurance, light touch at the border - GS1 New Zealand
GS1 NEWS

                                                                                                                 Corporation; Callaghan Innovation; Inland

            NZBN Bill favours ‘all in’                                                                           Revenue Department; Ministry for Primary
                                                                                                                 Industries; New Zealand Customs Service;
                                                                                                                 New Zealand Trade and Enterprise; and
                                                                                                                 any subsidiary of New Zealand Trade and
            Every form of business entity can have a New Zealand Business Number (NZBN)
                                                                                                                 Enterprise.
            – a 13 digit identifier based on a GS1 Global Location Number (GLN) – if draft
                                                                                                                 The Government’s policy objective with the
            legislation becomes law in the coming months.
                                                                                                                 NZBN is that businesses have to spend less
            The Ministry of Business, Innovation and              general location in New Zealand. To meet       time and effort on administration, particularly
            Employment (MBIE) released an exposure                privacy requirements, further information      when interacting with agencies. The NZBN
            draft¹ of the NZBN Bill for public feedback           displayed will be what is already public       is also intended to facilitate e-commerce
            before 30 September and, after review of this         through the source register, with some         activity between businesses.
            feedback, legislation will be introduced to           additional optional choices. Non registered    The NZBN Bill will go through a Parliamentary
            Parliament, most likely in early 2015.                business entities (such as sole traders) can   select committee process, with public
                                                                  choose to make other selected information      submitters having more opportunity then to
            The exposure draft provides for NZBNs to be
                                                                  public if they wish. The draft also has        comment on specific provisions. On behalf of
            issued to sole traders, partnerships, registered
                                                                  prohibitions on the misuse of NZBNs –          its members, GS1 New Zealand gave feedback
            societies, public sector entities and all other
                                                                  this includes their use by individuals in      on the exposure draft.
            forms of entity which may be considered a
                                                                  their personal capacities – and the false
            “business undertaking”. Individuals acting
                                                                  presentation of a number as an NZBN if it      ¹ Draft prepared only for public information
            in their personal capacity are not eligible for
                                                                  is not registered as such, or it belongs to    and discussion before the drafting of a bill for
            the NZBN; sole traders may only use their                                                            introduction to Parliament.
                                                                  another business.
            NZBN when acting in their business capacity.
            Until now, NZBNs have been issued only to             Eight government agencies will be required
            registered companies.                                 to recognise NZBNs when interacting with
                                                                  business entities (including other agencies)
            The exposure draft proposes an electronic
                                                                  from 31 December 2017 onwards. These
            register (a directory) of all NZBNs, with their
                                                                  agencies are: MBIE; Accident Compensation

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SCAN High assurance, light touch at the border - GS1 New Zealand
GS1 NEWS

ProductFlow for easier
market access
GS1 New Zealand’s ProductFlow service is being rolled out progressively to food and grocery companies after a successful
pilot stage in recent months. ProductFlow facilitates the introduction of new products to market, and the notification of
subsequent changes to retailers and buying organisations.
Companies will find it easier to provide     and Countdown – have been involved
                                                                                                  PRODUCTFLOW
the product data and images required         in the ProductFlow pilot: Barker Fruit
                                                                                                  BENEFITS
by Foodstuffs and Countdown on new           Processors, Bluebird Foods, Meadow
products and product changes (new            Mushrooms, Nestle New Zealand and                      Easier for supplier companies
attributes, price changes etc).              Picot Productions. These GS1 members                 to launch products into consumer
                                             vary widely in products, size of range and           markets and to make changes to
ProductFlow gives suppliers a simpler        familiarity with GS1net but all successfully         existing products.
process for using GS1net™, and also for      used ProductFlow for the simulated launch              Certainty for Foodstuffs and
providing the grocery retailers with the     of new products, and changes to existing             Countdown that all product data
exact product images they require and with   ranged products.                                     and images they require are accurate
bar code verification reports in regard to                                                        and delivered into their systems at
product packaging.                           The pilot involved them using the ProductFlow        the right time.
                                             application page – accessed through the                Easier for supplier companies to
GS1’s ProductFlow team will resolve any      MyGS1 members’ area of www.gs1nz.org – to            secure maximum value from using
issues with the supplier concerned, and      assemble and share product data and                  GS1net™ – they can get onboard more
then issue both supplier and retailer with   images for the specific purpose of launching         quickly, then upload and/or change
a concise ProductFlow Verification Report    to market or introducing product changes.            data on one or just a few products
confirming that data, images and bar codes   Standardised master data and images on               at any given time.
on each product have been reviewed and       each product were uploaded to GS1 systems              Clarity for all parties around the
are “good to go”.                            for consumption by their customers.                  option of outsourcing to GS1 the
                                                                                                  work of gathering and uploading
GS1, Foodstuffs and Countdown will make      In each instance, Foodstuffs and Countdown           data and images on new and/or
ProductFlow progressively available to       could clearly identify high quality data and         changed products.
suppliers in coming months. Individual       images being received into their systems
companies will receive advice on how and                                                            Seamless connection to GS1 Bar
                                             through ProductFlow– and this facilitated
when they can begin using the new service.                                                        Code Verification services when these
                                             distribution, marketing and sales activities
                                                                                                  are needed for introduction of a new
                                             for the presentation of new products and/or          product or of product changes.
Five companies – a cross section of food
                                             changed products to consumers.
manufacturers who supply Foodstuffs

Digital image services
Digital images are increasingly              GS1 New Zealand has studios in Auckland
                                             and Wellington, providing members
important in the marketing and sale
                                             and others with digital photography of
of products. Suppliers and retailers         products to the highest global standards.         by, or on behalf of, product suppliers.
need high quality “digital assets” for       When requested, we will upload these              Companies are also able to use SmartMedia
use in printed collateral, websites,         images into SmartMedia.                           as their own internal registry (intranet) of
mobile apps and more.                                                                          digital assets.
                                             Uploading can be done by any authorised
                                             user – a manufacturer, retailer, communications   SmartMedia complements other GS1
GS1 New Zealand now offers high quality
                                             agency or other relevant supplier, along with     services including ProductFlow and the
product photography for many of these
                                             either GS1 New Zealand or GS1 Australia.          GS1net™ platform for product master data.
purposes. And we offer SmartMedia™ – an
                                             SmartMedia is a collaboration between the         It is available to any company for a fixed
Australasian-wide electronic repository
                                             two GS1 organisations, for use by trading         annual fee, with no limitations thereafter
for up-to-date and authenticated digital
                                             partners on both sides of the Tasman.             on the numbers of digital assets uploaded
assets. SmartMedia enables trading
partners to exchange all such assets for                                                       and downloaded, and with no additional
                                             In New Zealand, Foodstuffs and Countdown
any use in marketing and sales activity.                                                       costs. GS1 has a special subscription offer
                                             use the repository increasingly as a single,
                                                                                               for its members.
                                             reliable source of digital images uploaded

ISSUE 38                                                                                                                        GS1NZ.ORG     5
SCAN High assurance, light touch at the border - GS1 New Zealand
Don’t be invisible to
  your healthcare buyers

 healthcare buyers in australia and new Zealand are now
actively using the NPC or DHBNC to make buying decisions

OPTIMISE                                                         wHy CHOOSE BIzCAPS?
Bizcaps helps you to manage multiple requirements from
                                                                  Rapid solution implementations
a single source, eliminating the duplication of documents
and effort from your supply chain processes and providing         Visibility and control
a trusted, reliable and centrally accessible source of product
and pricing information.                                          Simplified Master Data Management
                                                                  Certified partner of GS1 in Australia,
AUTOMATE                                                          New Zealand and the United Kingdom
Bizcaps automates critical catalogue management
processes and procurement and compliance activities,              Experience creating and maintaining
delivering supply chain integrity and simplifying the process     the product data catalogues of
of preparing and publishing data to the DHBNC or the NPC.          some of New Zealand’s leading
                                                                  healthcare organisations including
EMBED                                                             Fisher & Paykel Healthcare,
                                                                  Glaxo Smith Kline, Obex Medical,
Bizcaps embeds strong data validation into standard               Pharmacy Retailing Nz (ProPharma,
business processes, allowing you to maximise the benefits         Onelink and HCL), Smith & Nephew,
associated with consolidated and clean product and pricing        Stryker and USL Medical.
information being readily available to your buyers.

www.bizcaps.com www.edisolutions.co.nz P 09 271 0316
SCAN High assurance, light touch at the border - GS1 New Zealand
EPC/RFID

Bigger RFID harvest for EastPack
EPC/RFID continues to support                    In the early years, EPC/RFID enabled            difference with continued growth forecast
                                                 EastPack to radically improve productivity      from now on.
operating efficiency gains at
                                                 in its use of staff and forklifts, and to
EastPack, the largest grower-                    eliminate penalties for failing to deliver      EastPack also now includes cool stores
owned post-harvest supplier in                   some orders to the ship by deadline.            previously owned by fellow post-harvest
New Zealand’s kiwifruit industry.                No longer would cool store operations           supplier Satara. Investment decisions on
                                                 descend into chaos at the height of the         rolling EPC/RFID into these stores have
EastPack has continued to reduce                 export season.                                  yet to be made or announced.
fruit losses this export season (March-
November) by striving to optimise                EastPack managers tell SCAN that
shipping out sequence of product from            the focus is now on precision in the
its seven geographically dispersed sites.        sequencing of product sent for export,
For this, operators must be able to quickly      and on reduction in spoilage risk as
locate pallets designated for a specific         pallets are moved around the store for
load-out (ranking based on fruit storage         fruit quality checking and for the
performance). Reduced fruit losses lead          preparation of next shipments. Higher
directly to improved financial returns for       quality fruit can, generally, be held in
the company and its growers.                     storage till later in the export season.
                                                 Optimum storage is at zero degrees but
This season has been the seventh for             regular movement of pallets to warmer
EastPack’s EPC/RFID system as installed          locations is inevitable. EPC/RFID readings
with GS1 New Zealand design and support          now alert staff to any pallet that is outside
in 2007–08. Nearly 60 cool stores in Te          zero degrees for 90 minutes or longer.
Puke, Edgecumbe and Opotiki, in the Bay          The system provides constantly-updated
of Plenty now use the technology                 data on product status as a basis for
                                                 shipping out sequence.
Each pallet of graded kiwifruit has an EPC
tag, used to track and trace its location        EPC/RFID becomes a more important
and movement within a cool store. The            tool as fruit volumes grow. In 2014,
system includes forklift-mounted tag             EastPack has handled almost 25
readers and ceiling markers that enable          million trays, up 14% from last year
each read to be precisely located in the         as the kiwifruit industry recovers from
store: EastPack has a constantly updating        the impact of PSA. New varieties that
database on the whereabouts, history and         are tolerant of this vine-killing disease
status of each pallet-load of kiwifruit trays.   have begun making a substantial

                                                 and ANZCO Foods engaged with GS1                is defined as a process that uniquely

Halal                                            Malaysia and SMTRACK for the trial, in
                                                 May–June this year.
                                                                                                 identifies a product and verifies that
                                                                                                 identity when needed in supply chains.

meat trial                                       Cartons of Halal product were tagged
                                                 at ANZCO’s CMP Kokiri plant, Hokitika.
                                                 The cartons and their shipping container
                                                                                                 Concern on the authenticity of Halal foods
                                                                                                 – prepared to Islamic dietary guidelines –
                                                                                                 is on the rise among Malaysia’s 21 million
Further trialling of EPC/RFID                    were subject to 11 RFID read events             Muslims.
and related technologies has                     between there and a cool store in Kuala
                                                                                                 The trial report by GS1’s Gary Hartley
                                                 Lumpur. Read data were uploaded to EPC
demonstrated their efficacy for                                                                  (“The use of EPC Standards and Radio
                                                 Information Service repositories within
export meat product traceability                                                                 Frequency Identification technologies to
                                                 the EPCglobal Network. The required
                                                                                                 demonstrate supply chain traceability and
and authentication.                              traceability and product authentication
                                                                                                 product authenticity of Halal meat products
                                                 outcomes were conclusively demonstrated.
A shipment of Halal-certified meat products                                                      exported from New Zealand to Malaysia”)
was tracked and traced between New               Product authentication is increasingly          is available from Pathfinder Group.
Zealand and Malaysia using GS1 identifiers,      sought for detection of counterfeit and
UHF (ultra high frequency) RFID tags, and        falsified products, and prevention of these                    Read the report
                                                                                                           www.rfid-pathfinder.org.nz
EPCglobal Network Architecture for data          moving through the distribution channels
storage and analysis. GS1 New Zealand            of genuine products. Authentication

ISSUE 38                                                                                                                       GS1NZ.ORG       7
SCAN High assurance, light touch at the border - GS1 New Zealand
CONNECT 2014

    6 BIG ideas
    In August, GS1 New Zealand hosted the CONNECT 2014 forum for global thinking on our future as an online
    economy, on innovation in our businesses and on our connections to China. Here are 6 of the big ideas from
    the event.

                                                                                                  New Zealand companies need their
    There’s huge value in using data               We’re all creative “just below
                                                                                                  own creativity and also a willing-
    about our lives to make and                    the surface” – companies should
                                                                                                  ness to adopt the most effective
    provide products and services                  empower people to come up
                                                                                                  global standards – both promote
    in new, lower cost ways.                       with good ideas.
                                                                                                  innovation and success.

    DR ANDREAS WEIGEND                             SIR KEN ROBINSON                               PHIL O’REILLY
    FORMER AMAZON CHIEF SCIENTIST                  INTERNATIONAL EDUCATIONALIST                   CHIEF EXECUTIVE OF BUSINESS
                                                                                                  NEW ZEALAND
    Andreas says: The world is increasingly        Sir Ken says: Innovation comes from
    data rich, and there’s huge value in turning   the creativity that is latent ir partially     Phil says: Global standards can be critically
    the most relevant data into decisions on       developed in all people. Creativity is         important to making New Zealand
    how to meet human needs and desires            the process of having original ideas           companies globally more competitive,
    in new, lower cost ways. “Big data”            of value – and creative skills can be          provided they are not standards set by
    refers to the constant creation of digital     developed in everyone because we all           larger international companies for their
    information on what we do, where we            have imagination. Moreover, creativity can     own purposes. “Just how we help create,
    move and how we spend money: We all            be applied to any aspect of business – in      and engage with, global standards is a
    leave “digital traces” when purchasing,        fact, any aspect of life. We can be creative   very important issue for us.”
    using smartphones and moving around.           in thinking about a company’s products,
                                                                                                  Business NZ is a keen supporter, for
    The world now creates more data in a           processes and systems, workplaces and
                                                                                                  example, of the New Zealand Business
    single day than it did throughout history      so on.
                                                                                                  Number (NZBN) – based on GS1 standard
    until 2000. Andreas said: “Big data is a
                                                   “Your job as a company leader is to create     identifiers – despite earlier concerns that
    mindset… it’s about turning mess into
                                                   a culture where everyone can have good         small businesses would see it raising
    meaning, raw data into valuable decisions”.
                                                   ideas”. To do that, a leader needs to          admin. costs and privacy issues. In fact,
    Businesses only get value from data by         believe staff generally have more talent       there has been no push-back on the NZBN
    using it to answer relevant questions,         than they give themselves credit for and       because firms see its benefits. “Standards
    and to bridge the digital and physical         to see the company more as a dynamic           and how they work should be thought
    worlds. Amazon, for example, pioneered         organism than mechanistic hierarchy.           about as a business-enabling, and a
    the offering of new choices to customers                                                      country-enabling, tool.”
    based on past purchases. Joining the           Companies must be innovative if they
                                                   are to adapt and succeed in the face of        Comments on creativity by Sir Ken Robinson
    “social data revolution” requires people
                                                   changes in markets, technologies and the       align with surveys that show manufacturing
    to give up information and to trust. “My
                                                   environment. Leaders need to create the        firms rank “talent-led innovation” as the
    rule is to embrace the transparency… it
                                                   right organisational environment for their     key driver of global competitive advantage
    is the new privacy”. AirB&B and Uber
                                                   people to be creative in. Most companies       today. In NZ, companies are increasingly
    are examples – owners of “latent assets”
                                                   have tremendous potential for innovation       keen on recruiting people with “soft skills”
    (private accommodation or vehicles) and
                                                   “just below the surface”.                      that enhance creative thinking, as well as
    potential users exchange their data through
                                                                                                  those with the traditional “hard skills” in
    smartphone apps and find matches. “Value
                                                                                                  science, technology and maths (si-called
    is created at the interface between the
                                                                                                  “STEM” subjects).
    physical and the digital.”

8   GS1NZ.ORG                                                                                                              NOVEMBER 2014
SCAN High assurance, light touch at the border - GS1 New Zealand
We are innovative people but                   New Zealand can lead the world                 Our business success in China
for NZ companies to succeed                    in online innovation — it’s our                requires understanding of how
globally, they need to really,                 next ‘moonshot’.                               critical the Internet and social
really want it.                                                                               media are to the Chinese.

DR MARY QUIN                                   CHRIS TEELING                                  JAMIL ANDERLINI
CHIEF EXECUTIVE OF CALLAGHAN                   GLOBAL HEAD OF STRATEGY                        BEIJING BUREAU CHIEF, FINANCIAL
INNOVATION                                     FOR XERO                                       TIMES (AND EXPAT KIWI)

Mary says: NZ’s innovative business            Chris says: Our last moon shot was the         Jamil says: China has 600 million Internet
owners tend to resist sharing ownership        1880s innovation in refrigerated shipping      users and rising, and they rely heavily on
and control, and that could be holding         –and it worked, opening a huge export          social media and online messages from
the economy back from greater global           trade in frozen meat that enabled NZ to        trusted friends when buying consumer
success. Callaghan Innovation sees a role      prosper. Today’s opportunity arises with       goods. That’s because food safety and fake
in helping Kiwi entrepreneurs learn how        Internet 3.0 (defined by explosive growth      products are such real threats in China,
to work with investors and others so they      in data flows) and this country’s capacity     and official information sources are not
can grow bigger. “There’s often a problem      for creating new data-based products and       trusted. “There are no transparent trust-
with people preferring to have 100% of         services. In Xero has a “dairy and digital”    worthy institutions… the usual checks and
a small pie rather than 30% or 40% of          vision: Its cloud computing business           balances are flawed or non-existent.” The
a much bigger pie… collectively, we can        will grow to have the same economic            2008 San Lu milk contamination crisis and
and have to change that (mindset)”.            significance to NZ as Fonterra does today,     its initial cover-up by officials made people
Ultimately, business owners must want to       with an “eco system” of other online and       even more suspicious. On the other hand,
succeed globally. “You’ve got to want it       software business growing around it (of        NZ and Fonterra came out of that crisis
and want it badly.”                            which 300 already exist). US analysts          pretty well.
                                               liken Xero’s growth pattern to earlier
NZ actually has many innovative,               online start-ups. “We’re on the same           China recognises the importance of the
technology intensive companies – most          trajectory as the Microsofts, the Googles      Internet by maintaining the “Great Chinese
relatively small – doing a wide range of       and Facebooks were… if we’re doing that,       Fire Wall” to stop its people using Google,
things (eg building aircraft and boats,        there is every opportunity for us to pull      Facebook and other major Western
pharmaceuticals, media entertainment,          through a lot of other IT innovations and      services: China has domestic versions of
engineering services). In this year’s Global   online opportunities”.                         these. The Government also uses Chinese
Innovation Index, we rank in the top 20                                                       social media to propagandize against
among 143 countries on various measures        With growth in its customers (most outside     foreign brands and encourage consumption
of innovation. “There’s no question about      NZ) and their data, Xero is developing new     of domestic goods. Fonterra’s false
our ability as a people to innovate.”          services that add speed and ease to doing      botulism scare in 2013 “couldn’t have been
Our tradition of innovation in primary         business online. “We’re going to be a multi-   better timed for those in China wanting to
industries is good but NZ needs to             billion dollar company and we’re going to      support the domestic dairy industry”.
diversify with businesses of bigger scale in   add a whole lot of export services to NZ”.
other industries.                              Xero calls for Government action to: expand    Today Chinese consumers still see our food
                                               connectivity so Kiwis have unconstrained       products as the safe, clean “gold standard”.
Growth in innovative businesses here is        access to data worldwide; promote standard-    China’s rising affluence continues to spell
hampered (as elsewhere) by shortages of        ised unique identification of businesses,      enormous opportunity for trustworthy
people with the right skills and by access     industries, places and products; and appoint   brands from NZ. For this, companies are
to capital (especially in the $2-10 million    a chief technology adviser for NZ leadership   best to do as Fonterra has done – use
range). Callaghan Innovation is looking        on the digital economy.                        services provided by Alibaba*, rather than
at how to connect groups of smaller                                                           set up their own sites. It’s critical to have
businesses with global investors who have                                                     employees who know Chinese culture and
$50 million to invest here, and to help                                                       what is happening online.
business owners make the transition.
                                                                                                     See Fonterra’s ‘trusted source’ purpose
                                                                                                                     page 15

ISSUE 38                                                                                                                        GS1NZ.ORG      9
SCAN High assurance, light touch at the border - GS1 New Zealand
Better data
                                                                        exchanges
                                                                        at the border
                                                                        WILL SPEED PROCESSING,
                                                                        PROMOTE TRADE AND
                                                                        BENEFIT OUR ECONOMY

     Comptroller of Customs Carolyn Tremain is leading the New Zealand Customs Service into a brave new
     world of “high assurance, light touch” for border protection and trade facilitation. It is a world of more precise
     and timely data exchanges about trade and people, where border processing is faster and Customs risk
     assessment is more targeted. Customs and the Ministry for Primary Industries (MPI) have taken a first big
     step by rolling out a Trade Single Window for all our international trade.

     Carolyn has over 20 years’ experience leading large, complex service delivery organisations, and substantial
     change programmes. Prior to joining Customs in 2011, she held Deputy Commissioner roles at Inland Revenue
     with responsibilities that included oversight of audit and investigations, contact centres, customer operations,
     customer and product innovation, and litigation management. Earlier, Carolyn was a senior manager with
     Air New Zealand where she was Head of the Human Resources and Organisational Change for the group.

     Q What does ‘high assurance, light          for example, by postal companies on           Q So there’s a direct relationship
     touch’ mean in the border environment?      goods being mailed into the country and       between the information provided
     High assurance really means us receiving    yet we struggle in our mail channel to        upfront by traders and the level of
     the right information in advance of the     have sufficient advance data for really       intervention they might encounter?
     cargo or the traveler arriving at the       focusing down on such goods. Shipping         Absolutely. In the past we have relied on
     border, and taking that information         lines and freight forwarders are very large
                                                                                               just our own knowledge and data view
     into account in determining the level       organisations with tremendous amounts
                                                                                               of a customer. Under our processes, if
     of risk and the degree of intervention      of data for their own purposes and some
                                                                                               you’re a first time trader you are going
     that might be required. In the future it    of that is of interest to us.
                                                                                               to concern us more than someone whose
     may not be relying exclusively on our
                                                 So, ‘high assurance’ is about border          seasonal peaks in business we understand,
     own administrative data, but also using
                                                 management agencies getting the right         along with all the other variables. The
     information that exists in supply chains
                                                 information in advance. ‘Light touch’ is      more we know about a trader, the easier
     and that we don’t normally see.
                                                 what an organisation can expect from          it is for us to determine whether they’re
     It might incorporate data from other        us at the border if we do, indeed, have       legitimate or not. And if we are assured
     parts of government or from completely      confidence that they are a legitimate         on their legitimacy, we will let their goods
     open sources. There’s a lot of data held,   trader.                                       flow more easily across the border.

10   GS1NZ.ORG                                                                                                         NOVEMBER 2014
FEATURE INTERVIEW

                                                                                              But our fastest growing partners are some
                                                                                              of the countries that we traditionally
                                                                                              regarded as being higher risk. The
                                                                                              challenge for New Zealand Customs with
                                                                                              its counterparts in different countries is,
                                                                                              ‘how do we actually get the confidence
                                                                                              needed in each other’s data?’ If they’re
                                                                                              a free trade partner, how do we get to
                                                                                              the point of having the knowledge and
                                                                                              exchange that really allows goods to flow
                                                                                              more easily, and especially if they’re a
                                                                                              trade partner with whom we traditionally
                                                                                              saw higher risk.

                                                                                              Q It sounds like Customs is taking on a
                                                                                              broader role in the economy?
                                                                                              We traditionally worried about things at
                                                                                              the border and what I am outlining is an
                                                                                              expanded pre-border function… in the
                                                                                              future, there’ll be something of a post-
                                                                                              border function too.

                                                                                              We can help industries because of our
                                                                                              understanding of certain provisions in
                                                                                              FTAs and whether they are actually being
                                                                                              used. Particular sectors might have an
                                                                                              advantage negotiated under an FTA which
                                                                                              is not yet being taken advantage of. Do
                                                                                              traders understand what advantages
                                                                                              they might have in access to another
                                                                                              market, for example? Some small and
                                                                                              medium sized companies can be put off
                                                                                              by perceived and actual complexities
                                                                                              in newer markets. If companies are
Q How can Customs move in this                  Q Are data exchanges between
                                                                                              experiencing problems getting goods
direction while facing growth in trade          customs agencies becoming a
                                                                                              through the border, then Customs can
volumes and in the risks that need to be        means of facilitating trade?
                                                                                              help them.
managed at the border?                          Yes, particularly trade with countries
The value of trade is increasing but            with whom New Zealand has Mutual              There’s an important difference in
actually the volume of export shipping          Recognition Arrangements. These are           Asian economies where business and
containers is declining. Import container       Korea, Japan and the US. Going forward        government tend to be much more
numbers are increasing and for us, having       with FTAs of various kinds, we will see an    closely tied. Sometimes our counterparts
the highest amount of data on them in           emphasis on greater recognition of each       in some of those Asian countries expect
advance of their arrival at the border is the   other’s data and on allowing trade to flow.   the government to have a view on what
answer. It means imported goods can be                                                        business is doing and to participate
cleared more quickly and distribution to        In New Zealand we are particularly            in trade. For example, if a sector or
market becomes much quicker, and that           comfortable about exchanging data with        organisation is experiencing difficulty
has productivity benefits to New Zealand.       some of our traditional trade partners.       getting their goods through an Asian

                                                                                                                    Continue on page 12
Similar requirements are emerging with
exports in a more inter-connected world.
Our partner border agencies in other
countries will increasingly rely on our
knowledge and understanding of particular
exporters from New Zealand to allow them                         Imported goods can be cleared more
to potentially flow those exporters’ goods
across their borders more easily. As a                           quickly and distribution to market
Customs authority, we will be relied
on – particularly by countries with whom                         becomes much quicker, and that has
New Zealand has free trade agreements
(FTAs) or secure export schemes (SESs) –
                                                                 productivity benefits to New Zealand.
for quality information relating to the
legitimacy of traders and goods.

ISSUE 38                                                                                                                    GS1NZ.ORG       11
FEATURE INTERVIEW

     country border – and I am thinking mainly     GFC (Global Financial Crisis) era, there’s        about particular goods and to clear them
     of China here – we can work with our          been quite an emphasis on growing                 through the border faster than otherwise.
     counterpart agency to help sort things out.   trade as a way of economies overcoming
                                                   the damage done through that crisis.              Q How is the Trade Single Window
     We did this successfully for the wine         Everyone is interested in growing trade,          progressing since launch on 1 August
     industry which was experiencing issues        and a lot of things we’re doing now are as        last year?
     with the clearance of goods held in           much about promoting trade as they are            Taking on a large IT system change is,
     bonded storage in China. We could see         about protecting New Zealand.                     frankly, not for the faint hearted and we’ve
     the situation was clear under the FTA but
                                                                                                     certainly had some challenges with this
     they were not getting the benefits. Now,      Q Again, it sounds like information               programme. But the Trade Single Window
     we have a good working mechanism with         flows are critically important?                   (TSW) has been up and running for a year
     our counterparts in China and we were
                                                   Absolutely. In future, initiatives like trusted   now. We are now up to 58.2% of all inwards
     able to help the exporters to get their
                                                   trader schemes for importers will be really       transactions from traders going through
     wine to market.
                                                   important. We certainly know that our             the TSW. Of outwards messages from MPI
                                                   Secure Export Scheme has a lot of value           and ourselves, 100% are going through the
     Q How much does this change
                                                   for exporters. For example, containers            window. Around 950,000 messages have
     your focus?
                                                   from New Zealand going across the United          now gone through the TSW.
     Our mission is about protecting New           States border under that scheme will
     Zealand but also promoting trade. A           be cleared faster than other containers           We gave an undertaking to industry that
     lot of the work we do internationally         arriving at the same time with the same           we would not release anything without
     with the World Customs Organisation           type of goods but from other origins. This        thorough testing first – and that has
     and, increasingly, with other customs         has real economic benefits to traders in          meant it has taken us longer to turn on
     agencies is focused on how we can get         New Zealand.                                      modules in the programme. It was initially
     trade flowing more between different                                                            to be a single-date implementation but
     economies.                                    Our role is providing assurance to US             we switched to a modular approach
                                                   authorities. We have a secure export              because that gives us greater confidence
     If we think back to the post-9/11 era,        seal that goes on the container. Our              that deployment won’t disrupt industry.
     then security was very much the central       relationship with the US is such that over        There are graphic examples of customs
     focus. That resulted in a lot of change in    time we have developed agreements to              organisations elsewhere in the world
     how supply chains are managed and, for        facilitate trade. They audit our Secure           bringing in new processes only to find
     example, in the introduction of the Secure    Export Scheme processes and that gives            that, after an OK start, trade was being
     Export Scheme. More recently, in the post-    them the confidence to accept our data            significantly disrupted. We’ve been very

12   GS1NZ.ORG                                                                                                               NOVEMBER 2014
conscious of international experiences,
and want to take a thoroughly tested and
deliberate approach.
                                                                                           A lot of things we’re doing
Q How many of the modules in the
TSW are now deployed?                                                                      now are as much about
Looking at the interface with traders, there
will eventually be nine message types on
                                                                                           promoting trade as they
the Trade Single Window platform. Four
of the top five of these have now been
                                                                                           are about protecting
deployed and they enable processing
of 71% of all border transactions. The
                                                                                           New Zealand.
remaining message types will be built out
over the next 12 months.

We have four pilot traders working with
us. The thing that is very important about
                                               out their onboarding than try to do it all at   Q Over time WCO3 must facilitate your
New Zealand’s TSW compared with
                                               the same time. I encourage people to look       ability to share data globally with other
                                               at our website or email us with questions.      border agencies?
systems in other countries is that we are
using World Customs Organisation Data                                                          WCO3 helps us greatly in narrowing down
                                               Q For those using the TSW there is              the description of goods. Tariff codes are
Model Version 3 (WCO3) – and that really
                                               still a choice about the WCO3 message           quite broad as they currently stand. Textiles,
gives us greater granularity of trade data
                                               format. How is the migration to WCO3            for example, are a very broad tariff code
and that, in turn, enables us to have a
                                               proceeding?
firmer basis for our risk assessments.                                                         description of goods whereas under WCO3,
This ability to work with WCO3 will            There are some traders using WCO3 now.          product codes can be narrowed down to
future proof a lot of New Zealand’s trade      Fonterra joined, in May, so has FedEx and       specific types of textile and garment. It’s this
management processes.                          also a small percentage of CargoWise clients.   narrowing down that lets us know exactly
                                                                                               what goods are and to have real confidence
                                               Most people are still using a legacy
Q How is industry responding                                                                   in making our risk assessments.
                                               message format. Getting them onto TSW
to the TSW?
                                               is the first step and the next is moving        In TSW we will ultimately require freight
The real advantage with the TSW is that        them from legacy to WCO3. If you’re a           forwarders’ manifests, not just shipping
you advise government once, whereas            small trader, working through CargoWise         lines. This was a complicating factor when
previously you had to advise individual        or another gateway, then you’ll probably        the (container ship) Rena went down (in
parts of government. One set of messages       do what they suggest you do.                    the Bay of Plenty in 2010). People didn’t
for all purposes, without having to worry
                                                                                               know exactly what was in the cargo. If a
about who is requiring which pieces of         Some organisations like freight forwarders
                                                                                               similar event occurred in the future we
information in the different agencies.         would want to see everything up and
                                                                                               would have a much better understanding
Traders will have different approaches to      working well across all the message types
                                                                                               of what the ship was carrying.
the TSW depending on their size, needs         before they move to WCO3. But there
and sophistication.                            will be a point in the future when we will
                                                                                               Q Where do you see GS1 data
                                               want all industry to start using the WCO3       standards contributing?
Large organisations like Fonterra manage       message format. There will be a deadline
their own messages and have a direct                                                           GS1 identifiers are part of our TSW data
                                               for that some time in the future but it
connection to our system. There are a lot                                                      set and they’re incorporated into the
                                               hasn’t been determined yet
of organisations with their own systems                                                        information traders give us. There are
like FedEx and others like CargoWise who                                                       fields where you can enter GS1 numbers
                                               Q How does New Zealand compare
provide a gateway service for others. The      with other countries in this regard?            or alternative forms of identifier.
TSW allows people to connect directly
                                               We’re the first country to have a Trade
through a single portal but if you’re a                                                        Q Would you say that border agencies
                                               Single Window (TSW) based on WCO3.              are, in fact, adapting themselves to be
small organisation with a small number of
                                               There are very few comprehensive trade          part of supply chains?
consignments, the gateway or translator
                                               windows like ours operating in the world.
approach might still be the best way to                                                        Yes. At the heart of our perspective is
                                               It is very much a leading, future-proofing
import or export.                                                                              an understanding that industry has high
                                               system for New Zealand traders. I regularly
                                                                                               quality data and that as we become a
We are ready to talk to any company            say to people that it’s there for the next
                                                                                               more globally connected set of countries,
about what their adoption plans are for        20 years. It is a big investment and one
                                                                                               having common standards for data and
the TSW. We are at the point where we’re       that is jointly funded with industry through
                                                                                               formats at the border has big benefits to
wanting to understand what peoples’            recovery of some of the government’s
                                                                                               industry. If you’re a multinational working
thoughts on the process are so that we can     development cost.
                                                                                               out of New Zealand and you distribute to
smooth out the transition process. In fact                                                     10 countries today, border requirements
we would much rather have people spread

                                                                                                                       Continue on page 15

ISSUE 38                                                                                                                        GS1NZ.ORG         13
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John                                                                          Phone:   +61 2 9468   3333   Fax: +61 2 9468
                                                                               Phone: +61 2 9468 3333 Fax: +61 2 9468 3300 3300
 JohnRix,
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Phone:
 Phone: +61 2 94683333
        +61 2 9468  3333
Email:
 Email:john.rix@pacificcommerce.com.au
        john.rix@pacificcommerce.com.au                                            www.pacificcommerce.co.nz
                                                                                   www.pacificcommerce.co.nz
FEATURE INTERVIEW

are probably different in all 10. There’s a      A lot of what we are talking about is            Key Terms
lot of complexity in managing that. I and        lessening the burden of compliance               The Joint Border Management System is a new
my colleagues in other border agencies           and with the TSW, we’re working on               information technology system for New Zealand
hope that, over time, we can get to              how to effectively measure the benefits          Customs and the Ministry of Primary Industries to
                                                                                                  jointly handle all trade and passenger processing,
something that looks like international          flowing through to industry. Obviously           and intelligence, risk and enforcement functions
supply chains.                                   there are many variables and it’s very           in the border environment. The JBMS is being
                                                 hard to capture the benefit of having an         progressively introduced using a modular
You have a limited number of shipping            employee process a message in 15 minutes         approach. The Trade Single Window is one of two
companies that manage a lot of the               as opposed to half an hour. The trader           main components and has been operating since
trade and if we could leverage off their                                                          1 August 2013.
                                                 can say, “how can I actually capture that
data to get a really good sense of the           15 minutes?’ We’re looking at how we             New Zealand’s Secure Exporters Scheme provides
risk associated with each container,                                                              registered exporters with greater certainty on the
                                                 can leverage work done with our pilot
there could be huge benefits. GS1 is an                                                           passage of their goods across borders without
                                                 partner organisations to get a better            tampering, sabotage or other criminal disruption.
enabler for all that – and I think it provides   understanding of such benefits.                  Customs will allow exporters to join if they meet
a mechanism for us to look for more                                                               and maintain a certain level of security and data
competitive advantage for New Zealand.           Goods clearance is occurring pretty              integrity in their day-to-day operations.
                                                 quickly through the TSW – it actually can        The Trade Single Window provides importers
Q Overall, what are the economic                 take less than 3 minutes for a clearance         and exporters with a single point of online contact
benefits of the TSW and the ongoing              to go through. New Zealand has had a             with Customs and MPI and other agencies for all
roll-out of a new Joint Border                   good record in striving to improve trade         data exchanges on the cross-border movement of
Management System (JBMS)?                        clearance times while some countries are         all craft, goods and people.

We see the benefits in terms of advanced         still happy at three to five days. Our times     The World Customs Organisation Data Model
management of border risk and protection         are down to minutes and a simple message         Version 3.0 (WCO3) is a standard format for
                                                                                                  assembling and exchanging the data required
of this country from biosecurity and drug        can go through in seconds. The question
                                                                                                  in common border processes worldwide. WCO3
harm, and in terms of facilitating more          remains of course, ‘does the trader achieve      differs from earlier versions through specific
efficient and competitive supply chains.         efficiencies out of that or not?’                inclusion of information required by border
There’s also benefit in equipping New                                                             regulatory agencies other than customs.
Zealand to handle future change and to           Q What are Customs’ other priorities
get improved agency efficiency and value         in 2014/15?
for money. Quantification on the benefit         We are starting to update the Customs
to date is primarily in the area of staff time   and Excise Act, partly to reflect how supply
savings – between MPI and ourselves that         chains actually work today. If people have
figure is approximately $19 million. There       particular views on the legislative frame-
are big benefits over time in our ability to     work that sits over supply chains, there’s
target our resources at the areas of greatest    an opportunity over the next 12 months to                For more information on using the Trade Single
                                                                                                          Window or for submissions on updating of the
risk – something that border agencies are        get involved. Our Act is quite old, certainly            Customs and Excise Act, visit
working towards round the world.                 pre the electronic era… it needs an overhaul             www.customs.govt.nz or contact
                                                                                                          feedback@customs.govt.nz or phone
                                                 to make it fit for the future.                           0800 BORDER (0800 267 337)
Overall, the anticipated savings from the
JBMS over time are $535 million and we’re
starting to see some of those benefits now.

Fonterra’s “trusted source” purpose
Fonterra has committed itself to being           fastest growing consumer market… it’s an         growing market where consumers
the world’s most trusted source of dairy         opportunity we at Fonterra want to grab          want and need our products, and the
nutrition, according to the company’s            with both hands while retaining a sense of       government generally welcomes us”.
Director of Business Transformation,             modesty and respect.”
Philip Turner. He told CONNECT 2014                                                                Asked to comment on product traceability
that Fonterra has adopted this purpose           Fonterra’s in-China milk production was           within Fonterra’s global supply chains,
after deep reflection on last year’s             150 million litres last year, with a target of    Mr Turner said this was absolutely vital.
false botulism scare in whey protein             1 billion by 2020 as it builds more dairy        “We have an ambition to be able to trace
exported to China.                               farm hubs. Mr Turner said Fonterra is also        every single product from its origin to its
                                                 working hard to grow its branded products:        becoming a consumer product within three
Mr Turner said Fonterra recognises more          New Zealand-made UHT milk, for example,           hours. We are a long way from that at the
than ever that its enormous potential in         has built a 5% market share in the Yangtze        moment, but the more we can do with
China hinges on maintaining consumer             Delta region in only two years.                   governments to get common standards
trust there. He outlined the company’s                                                             and to move beyond the point of having to
plan for solid growth in all segments of         Mr Turner said China’s openness and               re-label products (as they move along the
that market – ingredients, food service and      respect for trade laws makes it a “happy          supply chain), the better.”
branded products. “China is the world’s          space” for Fonterra. “We have a rapidly

ISSUE 38                                                                                                                             GS1NZ.ORG             15
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