TRADE New life in old town - NZ Homebuilders and Bunnings break new ground - Page 8 - Bunnings Warehouse
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TRADE
APRIL 2015
New life in old town
NZ Homebuilders and Bunnings
break new ground – Page 8
Working with the taxman
Managing business ACC commitments
Lured by the lifestyle
Kynoch Construction profile
The green, green buildings of home
Sustainability in construction
There is a lot of winning going on in the
country. From the sports fields to the Earn LBP Skills
business arenas, New Zealand is on a Maintenance Points
positive roll. WITH TRADE ISSUE
#
There is a spirit of achievement and success that is flowing through the Once you have read this edition
country. Long may it continue! of Trade Issue remember to keep
a record of your learning.
This edition of Trade Issue covers a great deal of ground and subject matter.
1 hour of learning = 1 point April 2015
It is often said the two certainties in life are death and taxes. The latter can
be much easier to deal with once you have a handle on managing your
businesses ACC responsibilities. Changes are happening to the LBP
ACC is perhaps the one area of taxation that people tend to take a ‘hands
Skills Maintenance programme
from 2 November 2015.
off’ approach to managing. This, says a high profile tax expert, is a lost
opportunity. EY tax partner Jo Doolan, who has more than 20 years’ Find out more at
welcome
bunnings.co.nz/trade/trade-central
experience with IRD and the accounting profession says too many small
and medium-sized companies see their ACC commitments as a “passive
Contents
nuisance”, whereas, in fact individuals and businesses need to take a hands-on
approach. In this issue we explore why and how.
05 New Products
The green movement is alive and well in NZ, and sustainability and protecting 06 Building Essentials
the environment are key considerations for many. The building sector is
no exception to this. As we explain people are willing to pay a premium for
10 Building Scene
buildings that are environmentally friendly and sustainable. Those in the know 11 Trade Advice
in New Zealand suggest builders and tradies would do well to tap into this
potentially lucrative market. 14 Determination
08 12
Our Determination section of this issue covers an important topic area –
Restricted Building Work or RBW. Despite the information provided by the New life in
Ministry of Business, Innovation and Employment it would be fair to say that old town
not everyone knows what is RBW and what is not. Citing two cases from Working with
the Taxman
Wellington we delve into the ‘nitty gritty’ of this area of building compliance.
Our profile this month is on Scottish born builder Peter Kynoch. Now resident
of Palmerston North he left the Highlands of home for the chance to start his
14 15
own enterprise down under...and also the lure of the great outdoors.
We also cover a new addition to one of Auckland’s oldest suburbs with the
story of how Bunnings helped New Zealand Homebuilders put roofs over first
homebuyer’s heads. The green, Restricting
green buildings restricted
As always, we hope you enjoy what you read and we are always keen to hear of home building work
your comments on other matters you wish us to cover.
Des Bickerton
Commercial Manager
The opinions expressed in Trade Issue are not necessarily those of Bunnings. Although every effort has been made to ensure
the accuracy of the information, the reader remains responsible for the correct selection and use of tools, materials and systems
as well as following any law or code mentioned in this issue.
*Terms and conditions apply. See Trade Desk for details.
2
Kaboodle Kitchens
Kitchens are often the ‘make or break’ part of creating someone’s dream home. Done to
perfection they can be the finishing ‘touch’ to ensure clients are delighted with the job. Yet the
cost and time pressures involved in having to make the area both functional and good looking
can hamper budgets and work flows.
Cost pressure?
Kaboodle kitchens are a fraction of the cost that you would normally
expect to pay if you were opting for a custom built kitchen. This price
saving is largely due to the modular nature and standard sizes of the
Kaboodle kitchen products.
A comprehensive range of cabinets are available. Cabinets, accessories,
colours & finishes can all be tailored to meet the required budget.
Cost savings don’t come at the expense of quality however. The
Kaboodle kitchen range has all the core features you would expect in a
custom built kitchen: Soft close full extension drawers, solid 16mm
backs, adjustable feet, soft close hinges, moisture resistant board,
recessed backs & a 10 year warranty on cabinetry.
Time pressure?
The modular nature means Bunnings Warehouse stores carry the three
most popular colours, with another two by Special Order. Delivery to
smaller stores is usually within 5 days.
A design service specifically for the Bunnings Trade Customers is also
available. Send through your plans for an easy path to a quality kitchen.
Still struggling to meet deadlines? Kaboodle can assemble the cabinets
for you.
All Bunnings Warehouses have display kitchens on show. Contact a
Bunnings Account Manager or head to a Bunnings Warehouse store
to discuss your requirements.
3
Repairs to plasterboard
walls and ceilings
Winstone Wallboards has a
range of GIB® products
well suited to make minor
repairs easy and to create
a professional finish.
Visit www.gib.co.nz for more information.
Purchase any GIB Plus 4® (4L pail) or GIB®
TradeFilla™ (5kg bag) or GIB® Gapfiller (300ml
cartridge) from Bunnings between 1st - 30th
April 2015, and go into the draw to win.
1 of 3 Flight Centre Gift Cards,
valued at $1000 (incl. GST) each.
Terms and conditions: This promotion is open to trade account holders only. Purchase your GIB Plus 4® (4L pail), GIB TradefillaTM (5kg bag) or GIB GapfillerTM
(300ml cartridge) from any participating Bunnings stores throughout New Zealand and you will automatically go in the draw. Promotional period is between
1st – 30th April 2015. Promotion will be drawn on Friday 1st May. Prizes are to be taken as stated and are non-exchangeable.
MORE FROM WOOD.
EGGER OS’Floor by IBS
TM
PERFORMANCE YOU CAN RELY ON
Fast installation Certified
and easy handling
• Fit for Purpose AS/NZS 1860.1 Particle Board
• Pre-marked nail grid on the top face
• Continuous third-party testing
• Major axis marked on surface
• Hardwearing exposure tested by SCION
• Edge sealed T&G profile New Zealand
• Lightweight
Proven performance
• Strength and stiffness properties
• Dimensionally stable
• Edge swelling protection
Environmentally friendly
• E0 Formaldehyde-free glue
• Supports healthy indoors
Purchase 15 sheets of the OSB Floorsheet and be in the draw to win
1 of 3 AEG 18V 3 Piece Brushless Combo Kits
worth $799 incl. GST
Terms and Conditions: Promotion runs from 1st – 30th April 2015. Purchase 15 sheets of the OSB Floorsheet from a
Bunnings store. All eligible customers will be drawn at the conclusion of the promotion and the prize will be sent during
For samples, brochures and more the month of May 2015. There are 3 prizes to be won. Offer open to trade account holders only, limit of one prize per
customer account. The prize is non-refundable, non-transferable or redeemable for cash and will not be available for
info check out our webpage pick-up at the time of purchase.
4
new
TOOLS OF THE TRADE
$
65130 EXCL. GST
SKU00288549
TECH SPECS
Bosch Brushless 18V Combo Kit
• 3 x 4.0Ah 18V-Li batteries and AL1860 Charger in tool bag Bosch Brushless 18V Combo Kit
• Powerful sound for FM/AM and MP3 radio 18V GSB 18V-EC
Brushless Drill/Driver Striker
• Brushless technology provides higher performance and longer runtime
• Voltage 18V
• No-load speed (1st /2nd gear) 0-500 / 1700rpm
9 $ 91 –
From EXCL. GST
• Impact rate (bpm)
• Max torque
0 – 25,500
50Nm
$
10334 EXCL. GST
To SKU00286409/SKU00286310/SKU00286316
• Max drilling Ø wood/steel
• Torque setting range
38/13 mm
18 + 1
• Weight 2.2kg
18V GDX 18V-EC
Brushless Impact Driver/Wrench
• Voltage (V) 18
• No-load speed (rpm) 0 – 2,800
• Impact rate (bpm) 0 - 3,200
• Max. Torque (Nm) 170/185
• Screw diameter M6-M16
• Weight (kg) 1.8kg
Arteor Range
• Timeless design GML 18V-LI SoundBoxx
• A wide choice of ergonomics and finishes from the elegant • Voltage (V) 18
simplicity of the neutral finishes to the refinement of the signature line • Battery (Ah) 1.3– 4.0
• A collection rich in choice and fine materials to • Music Source FM/AM/Aux-In
make each room truly unique • Presets 5FM/5AM
• Creates a modern look in your home • Loudspeaker (W) 2x5W Neodymium
• Ideal to modernise power points and switches
• Order only Arteor Range
• Cover plates available for switches
and powerpoints
• Push button dimmer mechanisms available
$
16434
SKU00275027
EXCL. GST
• Sizes vary for different products
• Switch grids and powerpoints available
Foreno Sprint Sink Mixer
• Elegant and modern look, square style with soft edges Foreno Sprint Sink Mixer
• All pressure designer style sink mixer • WELs Rating: Mains 3 Star; 8L/min, Low/
• Swivel spout Unequal 5 Star; 6.0L/min
• Watermark and Codemark certified • Minimum pressure 35kpa
• 7 year warranty
5
essentials
BUILDING
1200mm
$
173 04 $
34 70
173
$ 04
Cargo Case 166 Piece
Blow moulded
8m Xtreme Socket Set
heavy duty plastic. Tape Measure 1/4, 3/8 & 1/2".
SKU00188101 EXCLUDES GST SKU00162394 EXCLUDES GST SKU00228312 EXCLUDES GST
20oz
Claw Hammer
Nylon grip. SKU00127078
$
59
EXCLUDES GST
13 1200mm Level
1 horizontal, 2 vertical
vials. Lightweight.
SKU00260797
$
93
EXCLUDES GST
91 Work Boots
Stout brown. Sizes
7-12. Steel cap.
SKU00268821
$
155
EXCLUDES GST
65
PEr
PAir
Long Concrete
1258 34 17304
Handled Shovels Wheelbarrow
Trailer
7" x 4". Galvanised. $ 26 Round, square,
trenching, plumbers. $ 74 Bolt free plastic tray,
heavy duty tyre, well $
Fully assembled. Fibreglass handle. balanced construction.
SKU00809306 EXCLUDES GST SKU00198753G EXCLUDES GST SKU00208035 EXCLUDES GST
Terms and Conditions: Not all services and products featured are available in all stores, but may be ordered. See in store for product availability.
EACH
s 18V
Combo Kit
Includes hammer drill,
impact driver, circ saw,
angle grinder & area
light. SKU00254287
$
781EXCLUDES GST
74 710W
Hammer Drill
SKU00281350
$
123EXCLUDES GST
48
1050W
Reciprocating
Saw
Variable speed.
SKU00894305
$
259
EXCLUDES GST
13
1600W Mixer
Ideal for concrete &
mortar. 2 speed gear
box. SKU00288999
18V/240V Radio
121565 260 17304
Slide
$ $ $
Powered by 18V AEG
Compound Battery or 240V mains.
USB charging with device
Mitre Saw storage. Battery not EACH
SKU00212444 EXCLUDES GST included. SKU06230214 EXCLUDES GST EXCLUDES GST
$
127 83 $
260 $
30348
18V Multi
185mm 230mm Function Tool
Circular Saw Angle Grinder 2 x 2.0Ah lithium ion
1050W. SKU00236024 EXCLUDES GST 2200W. SKU00328946 EXCLUDES GST batteries. SKU00254295 EXCLUDES GST
17kg
Demolition
9500W
433 147652 208609
Breaker
50L Air
Compressor
2200W. Belt drive.
$ 91 1500W. 30mm
Hex shank.
$ Generator
2100 OHV 420cc $
Anti-vibration. engine. 28L fuel
Dual pressure gauges. EXCLUDES GST SKU00253045 EXCLUDES GST capacity. SKU00278934 EXCLUDES GST
SKU06290393
We reserve the right to restrict the purchase of commercial quantities. All prices are exclusive of GST. Prices valid to Sunday 31st May 2015.
New life in old town
In one of Auckland’s oldest residential areas, New Zealand Homebuilders
is breaking new ground with the help of Bunnings.
In 1843 the suburb of Avondale greeted its first European settler. Once the Great
North Road was completed, and with a railway connection coming on track in
1880, the area grew rapidly and became home to key industries such as brickyards,
“We started the company in
tanneries, mills and pottery works. Fast forward to 2015 and a whole new April 2013 and prior to that
generation of Aucklanders will soon be calling Avondale their very first home.
A major project is nearing completion at 27 Powell Street. Working alongside a my relationship with Bunnings
development company, New Zealand Homebuilders has been charged with the task
of completing 35 houses — designed primarily for first time owners — in record
was well established. They had
breaking time. proven their ability to deliver on
According to director William Bouman it was an undertaking that needed a great
deal of team work and coordination. “This part of Avondale is well established but
a number of other projects but
land became vacant and the opportunity arose to create this new residential area. the Avondale one was a whole
The scale of the project was a challenge in itself and involved developing a variety
of two and three story houses with a choice of two floor plans. The time frame new scale of development.”
made matters even tighter. The building began in September 2014 and the
completion date is June this year.”
A whole different scale
Account Manager Ryan Sylvester and Builder Steve Blake on site.
“By any measure this is a really fast turnaround. Our role was really developing
everything from the ground up so there were a variety of major responsibilities that
needed to be managed.”
While partner Steve Blake looked after the project management side of things,
William’s role was looking after management, marketing and other functions
including the liaison with Bunnings.
“We started the company in April 2013 and prior to that my relationship with
Bunnings was well established. They had proven their ability to deliver on a
number of other projects but the Avondale one was a whole new scale of
development.”
“We had total faith in Bunnings to deliver and they were also mindful of how critical
each and every step of the process was. They made sure they had everything in
stock when it needed to be and were incredibly good to deal with. They have
always been our key building supplier but this latest venture has only solidified the
relationship.”
8
Get to know your
Account Managers
Profiling Mark Canning
Having been with Bunnings for 10 years and in the
industry all his working life, Mark knows the value of
keeping good relationships to get the right results for
everyone. Mark has a grown up family and says a
round of golf helps keep him sane!
Mark Canning, Rotorua,
Phone 027 498 7136
Bunnings Trade Account Managers
Area Sales Managers Avondale TC/North Shore Hornby TC/Riccarton/
Gareth Osborne Craig Canty Shirley
027 839 0109 027 246 2001 Darren Payne
Glenfield/Avondale TC 027 503 6046
Matt Cardey Forrest Jin Hornby TC/Riccarton/
027 652 5268 027 484 2591 Shirley
Tim Trowell Pukekohe Chris Sunman
027 200 2034 Carla Hira 027 260 2468
027 246 2015
Hornby TC/Riccarton/
Troy Taylor Te Aroha/Paeroa Shirley
027 200 2032 Nigel Phillip
Martyn Hugo
027 230 8569
027 240 8950
Area Account Whangamata
Managers Barry Leighton Dunedin
For Bunnings trade account manager Ryan Sylvester the project felt somewhat like Whangarei/Kaikohe/Kerikeri 027 493 2018 Aubrey Gray
027 459 1738
being thrown into the ‘deep end’. Wayne Duxbury Hamilton/
027 475 5019 Putaruru New Plymouth/
“I had joined Bunnings in August last year and my first assignment was working Whangarei Alan Miller New Plymouth Trade
with the New Zealand Homebuilders team in trying to win the tender for building the Scott Scampton 027 499 7165 Danny McVicar
027 499 0812 Hamilton 027 246 2011
35 homes. I felt a real sense of responsibility and was somewhat scared of losing Darren Mayo
Avondale TC Hawera
the job. Fortunately for me our area manager, and Steve Blake, were extremely Denis Richardson 027 246 2008 Grant Cambie
supportive and helpful.” 027 498 1948 Te Awamutu/ 027 445 2917
Avondale TC/Mt Roskill Tokoroa
Feilding
Once the good news was received there was undoubtedly a moment of celebration, Greg Dalley Brent Pottage
027 457 9979 Kevin Walpole
027 200 1964
then down to the serious business of making sure the project ran smoothly. 027 446 1786
ETTC/Botany/Mt Wellington Cambridge
Bruce Robertson Palmerston North
Mark Haddon
027 453 7211 027 475 8661 Vanessa Linton
Nearing the end ETTC/Botany/Mt Wellington Te Puke 027 445 0957
Blair Wilcock Dean Cubis Palmerston North
“Our task was to supply trusses, roofing and all associated hardware. Given the 027 487 2697 Howard Yates
027 436 9902
scale of the project and the time frames, we had to keep an eye on all sales going Manukau/ETTC Mt Maunganui 027 246 2012
through the account to ensure we were keeping to budget.” Sam Marcel Dean Hollamby Waikane/Naenae
027 498 1796 027 228 6462 Matt Jenkins
With the finishing line in sight this new chapter in Avondale’s building history is Manukau/ETTC Mt Maunganui 027 243 1932
about to be completed. Wini Ryan Roger Corrin
Lyall Bay/Naenae
027 246 2003 027 246 2004
Heinz Baker
Takanini/ETTC Rotorua 027 442 0234
Jason Rosnell Andrew Chadwick
027 246 2010 027 246 2006 Naenae
David Turner
Takanini/ETTC Rotorua
Mark Canning 027 445 0955
Ryan Silvester
027 289 5576 027 498 7136 Waikane/Naenae
ETTC Taupo Nod Edmonds
Derek Wang Mel Hoverd 027 274 2947
027 459 1734 027 435 9054 Naenae
Takanini/ETTC Taupo Derek Rodger
Tony DeCleene Mike Bush 027 702 0414
021 528 840 027 492 9019
Lyall Bay/Naenae
Silverdale/Avondale TC Whakatane Gary Sim
Craig Petzer Greg Diemar 027 246 2014
027 436 0293 027 490 4302
Naenae
Glenfield/Silverdale Gisborne/Gisborne Trade
Terry Pointon William Hurihanganui
Joanne Smith 027 232 5283
027 246 2002 027 445 4375
Hastings Nelson
Silverdale TC
Jon Copeland Ian Sill Rowan P Ellison
027 703 1076 027 490 6529 027 652 5271
Silverdale TC Ashburton/Hornby TC Blenheim
Scott Godkin Shaun Parker Stuart Washington
A brand new bathroom nearing completion at 27 Powell Street. 027 431 8504 027 702 2129 027 481 0557
9
scene
BUILDING
by Rodney Dickens
It’s getting better all the time Number of Consents for New Dwellings
The good news is that the good news for 2015 keeps on improving. Most fixed Total Dwellings Apartments Non-Apartments
mortgage rates have fallen significantly since Reserve Bank Governor Wheeler
Monthly Annual Monthly Annual Monthly Annual
announced a pause in the Official Cash Rate hikes in July 2014 (see the chart).
Jan-13 1,312 17,143 58 1,609 1,254 15,534
Most spectacular has been the fall in the average five-year fixed rate offered by the Feb-13 1,542 17,481 142 1,689 1,400 15,792
major banks that is under 6% for the first time on record. The lower two, three and five Mar-13 1,475 17,397 16 1,540 1,459 15,857
year fixed rates should provide a significant boost to the housing market mainly Apr-13 1,755 17,922 214 1,616 1,541 16,306
because borrowers will have certainty of low interest costs for some time. May-13 1,971 18,521 219 1,767 1,752 16,754
Interest rates are the most powerful driver of upturns and downturns in residential Jun-13 1,539 18,783 160 1,809 1,379 16,974
building nationally. This also includes most regions. Changes in interest rates take Jul-13 1,893 19,198 218 1,792 1,675 17,406
around a year to have any impact. Therefore the upside in the number of consents for Aug-13 1,748 19,433 127 1,779 1,621 17,654
new dwellings – on the back of the fall in mortgage interest rates – should begin in Sep-13 1,862 19,775 156 1,749 1,706 18,026
around mid-year and continue until around March 2016. Oct-13 1,891 20,027 133 1,714 1,758 18,313
Nationally, and for most regions, the boost to residential building from lower interest Nov-13 2,267 20,636 492 2,167 1,775 18,469
rates will be supported by above average population growth that should reach around Dec-13 2,035 21,290 473 2,408 1,562 18,882
2% nationally by mid-year. It should remain above average for 12-24 months. Jan-14 1,644 21,622 154 2,504 1,490 19,118
Feb-14 1,768 21,848 66 2,428 1,702 19,420
But the good times won't last forever Mar-14 1,999 22,372 186 2,598 1,813 19,774
The housing market will remain cyclical and the good times ahead over the next 18 Apr-14 2,082 22,699 432 2,816 1,650 19,883
months or so will play a part in undermining future prospects. Increased residential May-14 2,125 22,853 195 2,792 1,930 20,061
building will contribute to a lower unemployment rate and higher labour cost inflation. Jun-14 2,002 23,316 243 2,875 1,759 20,441
The labour market is at the centre of medium-term consumer price inflation and Jul-14 2,282 23,705 373 3,030 1,909 20,675
interest rate prospects. Aug-14 2,059 24,016 291 3,194 1,768 20,822
At the moment inflation is low, largely as a result of the appreciation in the exchange Sep-14 1,895 24,049 262 3,300 1,633 20,839
rate in 2014 and falling agricultural product prices and petrol prices. Lower consumer Oct-14 2,152 24,310 179 3,346 1,973 21,054
price inflation contributed to the fall in mortgage interest rates since mid-2014. Nov-14 2,420 24,463 474 3,328 1,946 21,225
But the three factors that largely drove the fall in inflation are reversing. They are, Dec-14 2,199 24,627 466 3,321 1,733 21,396
however, of limited relevance to medium-term inflation prospects that will be Jan-15 1,703 24,686 314 3,481 1,389 21,295
determined predominantly by the tightness in the labour market. Equally, while above Source: Statistics New Zealand
average population growth may last another 18 months or so, past experience points
to it not continuing indefinitely.
Mortgage Interest Rates
Averages of the major banks
Resource Management Act and Productivity Commission review 11
5 year
4 year
The Housing Accords - either in operation or in the pipeline for nine urban centres -
10 3 year
will in time boost the supply of land for residential building. They may not, however,
2 year
improve the affordability of section prices that much. Things are moving slowly in 1 year
9
making new housing more affordable, but the planned changes to the RMA and the 6 month
Productivity Commission's review of council land supply policies should eventually 8 Floating
result in more affordable sections.
7
This will deliver an underlying upturn for residential building as distinct from the
cyclical impacts of interest rates and population growth.
6
5
Rodney runs Strategic Risk Analysis, a property and economic research company. Jan-05 Jan-07 Jan-09 Jan-11 Jan-13 Jan-15
Visit their website – www.sra.co.nz - to sign up for free property and economic reports.
10e Every issue of Trade Advice will cover a number
of topics that effect how we as an industry
go about our daily business. If you have any
subjects you would like to discuss or have a
case history you would like to share email
ANDREW,
TEAM MEMBER
advice
us at comment@tradeissue.co.nz
TRADE
Working with the taxman
Death and taxes are the oft-quoted certainties in with 10 or fewer employees can get a 10% discount by providing evidence about
good H&S practices and then passing an ACC-approved audit. The discount lasts
life with one more enduring than the other. for three years, but companies need to make a declaration they still meet the
By Nikki Mandow standard after the first and second years.
Bigger companies can get a two-year discount of between 10% (for minimum
On a year-by-year basis, most people working in the construction and trades
H&S compliance) to 20% for best practice.
sectors are not going to get the tap on the shoulder from the Grim Reaper. A visit
from the Taxman, under the particular incarnation of ACC, on the other hand, ACC technical advisor Rachel Massey says there are also savings to be made
is pretty much inevitable. beyond ACC levies from companies which improve their H&S standards.
“By establishing good health and safety practices in your workplace, you’re likely
That doesn’t, however, mean you should blindly accept your ACC payment.
Taking the initiative with ACC can bring your premiums down, and ensure that to have more motivated and productive employees, lower absenteeism rates,
if you do have an accident, you get the money you need. fewer business disruptions, and reductions in the costs of sick pay and
temporary replacement staff.”
EY tax partner Jo Doolan has more than 20 years’ experience with IRD and the
accounting profession. She says too many small and medium-sized companies see
their ACC commitments as a “passive nuisance”, whereas, in fact individuals and
businesses need to take a hands-on approach.
“The message is that you should be proactive. There are savings to be made
and a better outcome to be had.” Knowing the nature of the ‘beast’ allows for some
particular pitfalls to be avoided.
Pitfall 1: Paying too much
ACC payments aren’t an immoveable feast, Jo says – in several areas there’s room
to manoeuver. Health and safety is one. ACC offers a discount for self-employed
people, and SMEs, with good health and safely policies and practices. Companies
11Degrees of separation
A second area, says Jo, is knowing that ACC offers a no-claims discount of 10%
for SMEs and self-employed people with a history of low claims. On the other side,
companies with a high claims record can pay 10% more.
Lastly, she says, bigger companies (ones that might have a dozen or so people
working purely in the office, doing management or administration) can reduce their
ACC bills by splitting their company in two.
Because ACC levies for people working on a construction site are higher than for
those working at a desk, companies can save money by separating the two
operations, she says, and getting a different classification for people that never
get out of the office. “If you have a lot of people employed it can be worthwhile
engaging with ACC and making sure the classifications are right.”
Bigger companies can get
Grant says less than 10% of the SME business people he sees opt for CoverPlus
Extra, partly because not many people realise you can negotiate your own deal with
a two-year discount of between ACC. Another factor putting people off is that it is expensive at the beginning (the
first year customers are effectively hit with a double bill because they are moving
10% to 20% for best practice. from paying in arrears to paying in advance).
However he believes more SME businesses should consider switching to
CoverPlus Extra. Largely because of the flexibility it gives them to set ACC levies
either higher or lower, depending on their particular circumstances.
Pitfall 2: Insufficient cover
A trap for new players is not having enough cover when you first become He gives by way of example the hypothetical case of a husband and wife team
self-employed or set up a business, says Grant Johnston, director of (Harry and Wendy) running a plumbing business. Harry does the plumbing work
Auckland-based JMV Chartered Accountants. and earns $40,000 and Wendy does the books and gets $12,000. The company
gets $3000. If Wendy has an accident, the business won’t necessarily be
“ACC has no history of what your income is, so even if your previous income
affected, but if Harry can’t work, there’s no income coming in.
as an employee might have been quite high, they’ll start with the minimum amount.
Although that is an advantage in terms of low premiums there can be risks of “Ordinary ACC would insure Harry for only $40,000, and if he had an accident the
getting a low ACC pay out, if you have an accident in the first year or two”. pay-out would be based on that $40,000, whereas the real income loss is $55,000.
CoverPlus Extra allows you to increase the husband’s cover (to a maximum level),
The minimum ACC cover for shareholders of new companies is $28,600 a year,
while decreasing the wife’s cover as much as possible. Furthermore, ordinary ACC
or $550 per week. “Could you survive for the rest of your working life on this
pays out on 80%, whereas CoverPlus Extra pays out 100%.”
income?” Grant asks. Similar issues arise if you’re trading as a company and have
an accident shortly after a bad year, he says. “ACC would pay you based on the Another advantage of the scheme is that because the level of pay-out has been
income for your last financial year,” he says. “Low income equates to agreed in advance, people don’t have to prove their loss of earnings when
low ACC pay out.” they make a claim. That makes it quicker and easier to get money out of ACC,
Grant says.
He suggests one solution is switching to ACC CoverPlus Extra – a lost earnings
compensation system where you agree in advance with ACC on how much money
you will receive weekly if you have an accident. You then pay premiums based on True reflections
that figure, not on what your income might have been the year before. ACC’s Rachel Massey also believes CoverPlus Extra is a good option when a
company’s taxable income is not a true reflection of its actual earnings. “For
example, if you’ve started a new business you may have start-up costs that will
offset your taxable income. Or if you have been in business a while it might be time
to purchase a new company vehicle or new equipment, which may offset your
taxable income.”
Jo Doolan says she is surprised how many people choose the standard ACC,
rather than negotiating their own deal. “CoverPlus Extra is a very good option,
but quite neglected.”
Pitfall 3: Low profit = low pay-out
Jo says another situation which can lead to problems with low ACC pay-outs is
when a company tries to minimise its profits or boost its expenses. The motivation
behind this is to pay less tax. For example, a husband-wife team might pay the
part-time partner for 20 hours a week of work, when in fact they only work five.
On the books, that reduces the profit, and therefore the amount of tax the
company pays (and the ACC levy).
But it might also hide the amount of earnings the couple needs if one has
an accident. Companies that do this, she says, are taking a gamble.
In short, you gain if you don’t have an accident, but if you do you may
end up trying to live on an unrealistic income.
12Lured by the lifestyle
In making the move from Scotland to Palmerston North, Peter Kynoch literally
took the bait of the great outdoors...which also led to his own business.
By Nikki Mandow
When starting out in the carpentry trade in the United Kingdom, Peter Kynoch Give thanks
saw a future full of “putting nice houses together”. The last thing he imagined was
One lesson he learned from a mentor early on was to always thank his staff at the
moving to the other side of the world to establish the Palmerston North-based
end of each day. He also phones clients personally to thank them when their
company Kynoch Construction. He almost certainly wouldn’t have
payment comes through. This creates lasting relationships - and an opportunity to
anticipated spending most of his time behind a computer.
hear any feedback before it becomes a complaint, he says.
Entering the industry because he was good with his hands, and not particularly
Not that he’ll shy from a challenge but the biggest headaches he faces are the highs
academic, Kynoch came second in his apprenticeship year, even though he failed
and lows of the industry. "We can all build, but it is a huge challenge to manage the
arithmetic. "The good news for my business is my maths is fine now.
booms and shortages. Recessions come and you've got no control. Good
Once you find your thing, you’re away."
employees – who’ve become good friends – rely on you, and through no fault of
On the subject of moving away, he willingly admits the hunting and fishing lifestyle your own they’re dealing with financial stress. It becomes a question of ‘how
lured him Down Under. It wasn’t long before he got the chance to start out on his many recessions do you have in you?’”
own –allowing the ‘call of the wild’ to be answered when needed.
Peter reckons he has at least one more. He may find himself sharing it with his son,
"I was working in Palmerston North as lead carpenter on a site, and was asked currently exploring carpentry through the Gateway programme at school. "He'd have
to fit a lock for the company contracting on the site next door. Though my employer to do his apprenticeship with someone else first, and then come back with his
wouldn't have approved, I fitted it. The company offered me a box of beers to own new ideas and ways of doing things.”
say thanks, and I said no – just give me a crack at your next contract.
They did, and before long Kynoch Construction was born".
The company began in the 1990s as a labour-only company, supplying men to Peter’s principles for success:
big commercial building sites. Later it developed into a contractor for large-scale
commercial work, sometimes taking on the odd home that was outside the 1. If you’re new in the business, choose your employer well. Don't just
scope of residential builders. take the first person who offers you a job. It has to be a win-win situation.
When the last recession hit, Peter saw an opportunity to enter the residential market, 2. Get stuck into the job. Aim to do it better than the person beside you.
a move which also provided him with a platform for apprenticeship training. A mentor once told him: “Do everything 5% faster and better than everyone else."
"We've always been big on apprenticeships and training. I get a lot of pleasure out 3. When you have your own business, live within your means.
of it. It's all about training good industry professionals and turning out good When you’re doing well, "keep your barn full", because no matter how good
men into society." it seems now, it will get tough.
In November, Kynoch Construction apprentice Takey Boli was one of three to 4. Be trustworthy, and loyal. Create long-term relationships with
win a Palmerston North Building and Construction Industry Training Organisation subcontractors and suppliers. "We don't shop around for price; we work
Rookie of the Year Award. Burmese-born Boli arrived here as a refugee with with the same people for years. Our regular clients know the team who
no English seven years ago. will be working for them."
"It's important to give staff
more than a pay cheque"
Wise investment
"It's important to give staff more than a pay cheque. We like to help them in other
ways and with other training such as accounting and ethics. We want them to know
how to get through life and do it properly."
Clearly people working with him are returning the favour. Peter now has 38,
including some who have been with his business for 10-15 years.
"A lot started with us as trainees, went away to do their OE, and came back.”
Kynoch reckons leadership isn’t hard, if you’re fair and honest.
"Lead from the front. You have to be respected and can only get it by earning it,
not demanding it."
Equally important is putting the right people in the right place and letting them do
their job. "Let your leaders lead, you don't have to do everything yourself. You’ve
chosen your people well, they’re good competent men, so let them go and do it."
13The green, green buildings of home
The world is moving fast to clean and green. Buildings are no exception.
So what are the opportunities for those with a penchant to build?
By Lynda Brendish
People are willing to pay a premium for buildings that are environmentally friendly
and sustainable. Those in the know in New Zealand suggest builders and ‘tradies’
would do well to tap into this potentially lucrative market. For a number of reasons.
When it comes to housing, Kiwis are dealing not only with a short supply and high
prices, but an inventory that is largely drafty, inefficient, and cold. Sustainable,
or 'green' building is the term given to structures, both commercial and
residential, that buck this trend.
Sustaining credibility
Green building practices are generally defined by energy and resource efficiency,
There are several things builders can do in their own practices to keep building
reduced environmental impacts, and other planet friendly criteria.
sites and operations greener. That generally involves limiting waste so it is wise to
“Green building involves approaching the planning, design and build to achieve purchase only as much product as needed where possible, avoid offcuts, reuse
better outcomes for the environment and people,” says Clare Gallagher, senior leftover supplies, and other such safeguards. Source supplies locally, where
technical coordinator at the New Zealand Green Building Council (NZGBC). possible, and from independently-certified sustainable suppliers.
“For an ideal outcome, all members of the project team need to work together The NZGBC offers independent ratings for both residential and commercial
and think about the broader picture and how they’re contributing to it. In terms of buildings – these being Homestar and Green Star respectively. Homestar rates
practice, it means good site management, thinking differently about construction homes on a scale of 1 to 10 and Gallagher says the average new home built to
– for example, to fit in extra insulation in houses – and collaborating with others.” current building codes rates around a 4. However, many builders around the
Energy efficiency and sustainability in home building is more than just a trend or country are commonly achieving 6 Homestar ratings or higher.
a superficial nicety. Various research studies show sustainably-built homes are Meanwhile, Green Star rates non-residential buildings, such as schools, offices and
healthier to live in, leading to lower rates of asthma and other illnesses. industrial buildings, from 4 (best practice) to 6 (world leadership). There are 111
Sustainable buildings are also generally better for the environment. According to Green Star buildings across New Zealand.
a 2006 Ministry for the Environment (MFE) value case they are found to “reduce “The important thing for builders to understand about these ratings is that they’re
waste and are much more efficient in their use of key resources such as land, independent verification that buildings have reached a certain level of environmental
energy, water and materials.” performance,” says Gallagher. “Without a rating, there’s no guarantee or evidence
to back up sustainability claims.”
“Green building involves Although NZGBC rates buildings, rather than businesses, individuals can be
accredited as Green Star or Homestar professionals – but that doesn’t mean every
approaching the planning, project they work on will be rated. What it does do, however, is give customers the
assurance that a builder is knowledgeable about green building practices,
design and build to achieve and backed by an independent body.
better outcomes for the
environment and people”
Green is growing
If the case for healthy occupants and a healthier environment doesn’t sway you
then economic factors just might. Overseas survey data shows homeowners are
increasingly seeking energy efficient and sustainable homes with findings that
suggest 88% of homeowners are willing to pay more for those features.
The MFE’s value case suggests sustainably-built office buildings may have a
land value 40% more than that of a conventional building. “In commercial
building,” says Gallagher, “figures regularly show Green Star-rated buildings
outperform their un-rated peers in terms of asset value and occupancy.”
While sustainable buildings start at the design phase, Gallagher says it’s
up to builders and tradespeople to understand these principles and make sure
they’re delivered. A builder working on a green project should understand the areas
where they will have an impact,” she says. “For example, separating waste on site,
and using products that have an environmental certification, are important.”
14Restricting restricted
building work
If you’re a Licensed Building Practitioner, chances
are you’ll know a thing or two about Restricted
Building Work, also known as RBW.
By Louise Swann
RBW relates to small to medium residential buildings that, in particular: or not a Council can include a condition whereby a Record of Building Work be
• Contain two or more residential units or residential facilities provided before the CCC could be issued.
• Do not contain commercial units or facilities The definition of RBW is covered by an Order in Council and since its first
• Have a maximum height of less than 10m introduction it has been amended. As of 4 December 2011 RBW is limited to work
related to a house, or a small to medium apartment building, that is:
RBW became part of NZ building law in September 2011. Its purpose was to ensure
that critical work relating to design or construction was undertaken, or supervised, 1. The design of fire-safety systems.
by ‘competent people’ in the form of a Licensed Building Practitioner or LBP. Initially 2. T he design work relating to the primary structure or external moisture
the focus was on the primary structure and external envelope of the building. For management systems.
those with an interest in the building code, this related to compliance with 3. The construction, or alteration, of
B1(structure) and E2 (external moisture). Since then the scope of work covered has • The primary structure, or the external moisture-management system, and is
been increased to include fire safety systems (referred to as the C clauses). covered under the following types of building work: bricklaying or block laying,
carpentry, external plastering, foundations, roofing, and
• Is covered by an LBP license class as defined by law.
Correct or incorrect, While the installation of tanking is building work, it is not covered by a license class
that is the question and so cannot be RBW. The fact that tanking is not RBW does not negate the
obligation to ensure that all building work complies with the building code as
required in section 17 of the Act. Plans and technical specifications need to be
With the introduction of RBW came two Memoranda: the Certificate of Design Work provided to Council when applying for consent.
and the Record of Building Work. The law defines them and this includes the format And, as for whether or not a Council can apply a condition whereby a
of the memoranda. In fact these two memoranda have more status in law than any RBW memorandum must be provided prior to the issue of a CCC. This is a little
producer statement. more difficult.
Despite the information provided by the Ministry of Business, Innovation and
Employment, it would be fair to say that not everyone knows what is RBW and what Avoid confusion
is not. The case in point is this particular determination – two in fact – that covers a We all think of Council as one entity but in Building Act issues a Council is actually
particular property in Wellington. two organisations. The Building Consent Authority (BCA) deals with matters relating
The first determination arose because Wellington City Council issued a Code to building consents and CCCs, whilst the Territorial Authority deals with matters
Compliance Certificate (CCC) with the condition that the tanking was excluded relating to RBW. The person behind the desk might look the same, talk the same,
because a Record of Building Work had not been provided by the LBP. The Council even wear the same clothes but they might be working for different organisations.
considered it was correct to issue the CCC in this way because, at the time the So RBW and building consents/CCC are managed by different organisations using
consent was issued, documents showed that Council required a record of building parallel processes. As ridiculous as it seems, the Council acting as a BCA cannot
work before it would issue the CCC. refuse to issue a CCC because a RBW memoranda has not been provided.
Furthermore it cannot make the issue of a CCC conditional on the provision of a
Tanking it RBW memorandum.
The owners considered that this was not the case arguing that the tanking had been As confusing as all this sounds the key thing is to be able to operate in the
installed by a certified applicator, the applicator had provided the manufacturer’s system. With that in mind here is my advice.
warranty and the Council had gone out on site and inspected and passed the
Be knowledgeable about what is, and what isn’t, RBW. Be knowledgeable about the
installation of the tanking. Furthermore the owners had been advised by MBIE
demands Councils can, and cannot, make. Most importantly make sure you have all
that tanking was not considered RBW.
the discussions/arguments before the consent and document stage on what is
This determination concluded that the owners were correct and that the CCC should agreed. This will then ensure that when the building work is finished you won’t be
be reissued without the exclusion of the tanking. having the ‘tail end Charlie’ scraps with Council.
However, the determination also noted that the lack of RBW documentation – In short, be knowledgeable, be consistent, document what is agreed and then stick to it.
namely the memoranda – does not play any part in whether the Council is satisfied
on reasonable grounds that the building work complies with the building consent.
Put another way, the lack of a Record of Work does not provide grounds to Changes are happening to the LBP Skills Maintenance
refuse to issue a CCC. programme from 2 November 2015.
In response to this decision, Wellington City Council applied for another Find out more at bunnings.co.nz/trade/trade-central
determination. It wanted to establish whether or not tanking was RBW and whether
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