The SWAG company is now established and incorporated and over the coming 12 months aims to raise $700,000 from industry to fund the necessary activities of the company’s work.
SWAG Ltd, charged with identifying opportunities to increase demand and value for New Zealand produced strong wool, has a mandated two-year lifespan from its incorporation at which time it is then required to liquidate the company.
With the operations of SWAG jointly funded by industry and the Ministry for Primary Industries (MPI), given the national importance of the work envisaged, MPI will contribute on a matched basis of 80% of the funding for industry 20%.
The industry target of $700,000 matched by MPI funding is hoped to secure a total operational budget of about $3 million.
“The Government see the SWAG project as an essential catalyst of change within the wool sector and is endorsing this project by agreeing to match all industry contributions, so this is a unique opportunity for SWAG to leverage your contribution to fund this vital project,” SWAG said in a written document to potential industry contributors.
Contributions confirmed to date include $50,000 each from Alliance, Affco, Anzco, Silver Fern Farms, Ovation, NZ Wool Scours, and Landcorp, $25,000.
Others tagged as future contributors include wool exporters, wool brokers, merchants, test houses, WRONZ, shearing contractors and larger sheep stations.
SWAG chair Rob Hewett says industry contributors have been led by the five major meat processors with wool specific interests now joining the effort.
Hewett says as the project ascertains more firm costings, the size of the investment required will be determined.
“We are conscious of the costings as we establish and develop the pathway with the workload changing as it matures,” he said.
“We are really pleased with the level of support we have got from contributors to date and heartened with the general understanding of wider industry support of the strong wool sector.
“We are number one consumer-customer focused, and we need to do things differently.”
SWAG has been portioned into three groups; one dealing with consumer-focused work; a second group is dealing with the industry good standards, data collection and training requirements; the third is helping to coordinate and support the chief executive.
Engagement is underway with international consumer research and product development companies to better understand consumer-focused market opportunities and how to reach these consumers.
“We are heartened by the responses from market discussions with strong interest within these companies as they see the emerging consumer opportunities around strong wool applications combined with our NZ back story,” Hewett said.
The consumer understanding project, working with IDEO out of San Francisco, is expected to be completed by March 2021 when defined market and product opportunities will become clearer.
In addition, MPI has completed a domestically-focused environmental scan to give SWAG a better understanding of who is undertaking innovative work with strong wool in NZ.
“Where these entities are comfortable with it, MPI is introducing them to SWAG,” he said.
“It is important that SWAG is aware of companies who are producing strong wool products that meet consumer expectations and demands already so we can incorporate these entities in the eventual set of recommendations to MPI,” Hewett said.
The National Council of NZ Wool Interests (NCNZWI) believes SWAG is double-dipping government funding and doubling up on the already W3: Wool Unleashed Government PGP programme with the NZ Merino Company.
The W3, a $22m seven-year programme, kicked off in 2016 aiming to deliver premiums for NZ’s strong wool sector from applying a customer-led approach to wool production and processing to develop products that align with customer preferences.
“The wool industry is very frustrated at the lack of information and direction,” council chair Craig Smith said.
“To us as an industry we look to be doubling up again – same funding, same money and no one is prepared to give us answers with no responses to our interest from either SWAG or MPI.
“We are five years into the seven-year (W3) programme, $11.54m has been spent, that we know of, but there’s been no June or September quarterly reports issued and no answers, no real benefits of that money spent and wool prices are at an all-time low.
“Yes, we know the strong wool industry is in a bad way, but do we need to be doubling up with very little accountability, no impact on the market or returns to growers and the national council for wool interests getting no communication and no feedback?”
Hewett declined to comment on the W3 Unleashed programme.
“And we (SWAG) will work with anyone who wants to work with us,” he said.