KKK: Kina fall not an issue

Business, Normal

The National, Wednesday February 26th, 2014


THE projected 10% drop of the kina this year does not worry KK Kingston, one of the country’s biggest manufacturers.

Managing director Keith Kingston said the company had a slight strategic advantage on its costs as a local manufacturer.

He said: “Everything is based on cost – cost of raw material, cost of labour and the cost of finished goods that we sell such as machinery and equipment.

“Obviously, while we passed that on (to consumers), we have done tremendous amount of work over the past 12 months to improve our sources of raw material supplies overseas.

“Because of that, we have been able to minimise the impact of the kina fluctuation.

“The further 10% drop (as projected by the ANZ Bank) is likely to have an impact on us (Kingston).

“But we also have to remember that the 10% increase on the cost of raw materials does not necessarily equate to a 10% increase in the cost of goods because we produce them locally.

“If it was an imported bottle of household bleach, it would be 10% on top of the cost of the total imported package. 

“We would  only pay the 10% on the value of raw material for the plastic bottle and the liquid inside but the local labour and overhead cost would still be in kina, so that gives us a slight strategic advantage.”

The company hosted a trade day recently to showcase its products.

Kingston said: “We practically brought in a number of our suppliers from overseas to show to customers what we offer.”

He said the company, which had diversified during its 42 years of growth, employed about 750.