4 Oct 2013

Firm 'lucky' to lose only half of China business

6:38 am on 4 October 2013

The head of infant formula company Carrickmore says he considers himself lucky that it lost only about half of its business in China following the botulism scare in August, given that other companies have lost their entire market.

Managing director Chris Claridge says before Fonterra's contamination alert, New Zealand infant formula exporters had sent about $230 million worth of product to China, 2.2% of the market in that country.

With other exporters, Mr Claridge has been in China on a damage control mission, but says there's no guarantee that his company's brand will survive in China.

He says the company has done a lot of work in China in the last three years and it's now in 20 provinces and 80 cities.

Mr Claridge says it's paramount to maintain confidence in Carrickmore's brand, product and quality systems with its Chinese distribution networks.

He says the last and more difficult question is how to maintain confidence in New Zealand infant formula and New Zealand food products.

Mr Claridge says it highlights just how this country operates in offshore markets, particularly in China. He believes there has been a high degree of naivety amongst New Zealanders who seem to think that having the first free trade agreement with China gives New Zealand a monopoly situation.

"This is a relationship that we have to work very hard on, we have to have a clear and co-ordinated approach to it with all relevant government bodies and industries working together collectively - and that's arguably not the case at the moment."

Mr Claridge, who is also chief administrative officer of the Infant Formula Exporters Association, says media coverage of the botulism scare was huge in contrast to the coverage after it was declared a false alarm.

He says New Zealand's reputation has been severely damaged in China.