Trace technology set to add value to milk
When Chinese-born Karl Ye emigrated to Australia in the early 1990s he needed to get a job to support his young child and his wife, who was studying for a PHD in public health at a Sydney university.
Within two years he had started his own company - essentially being the middleman sourcing natural products in Australia, such a bee pollen, and exporting them to Asian markets.
Twenty years on New Zealand Trade Minister Tim Groser will officiate on Tuesday at an Auckland function where Ye is opening a second canning line for his infant formula manufacturing company, GMP Dairy.
His group, GMP Pharmaceuticals. now has three plants in Australia and New Zealand manufacturing infant formula, health supplements and nutraceuticals. and another company, Aunew, providing a one-stop shop to small to medium businesses wanting to export into China and soon into Malaysia as well.
At the official event this week, Ye will also unveil what he says is world-first patented traceability technology on the infant formula cans that allows consumers to use their smartphones to scan a barcode telling them the milk powder's history and even includes an X-ray picture of the contents.
Although this may seem like overkill to Kiwi consumers, Ye says it is not in China, where food safety was a key issue for shoppers, particularly for infant milk powder following the melamine scandals. The technology could be used on other products, he says. GMP has already patented a black box for infant formula processing that monitors and stores information on the production process.
Ye's big on adding value - it is the business model behind GMP. He said the model is to source low-value natural ingredients from New Zealand and Australia and add value through world-class manufacturing and technology, and then use his connections and cultural nous to export them to Asia.
His company grew in the early days by advertising in local newspapers for migrants who had contacts in their home market for his exports. He still employs many migrants, claiming they are an untapped resource of expertise many other Kiwi and Australian employers shun because of cultural differences.
He says patience is the main ingredient needed in China, where negotiations tend to take years. That's one of the reasons he started Aunew in 2005, expanding the operations GMP had established for itself in Asian markets to help other smaller companies do the same. About 60 Australian and New Zealand companies have so far utilised the services. One of the key things they do is simply repackaging the product to appeal to Asian audiences who often want better packaging to give the products as gifts.
Born in Northern China and one of three boys, Ye got a masters degree in international economics at Wuhan University then headed to Australia. After establishing GMP there, Ye thought his value-add business model would work equally well in New Zealand. He lived here for three years from 2002 setting up a plant in East Tamaki. His second New Zealand plant, GMP Dairy, opened in 2009 due to increased demand in China for infant formula and was the first Kiwi manufacturer to be registered by the Chinese government under new rules introduced this year to lift quality and safety. GMP said it hoped to generate NZ$70 to $80 million revenue over the next two years from infant formula exports.
Ye says the company's second canning line will allow it to proceess 40 million tonnes of milk powder a year, or 400 million cans a year under its own brands and those of others it contract manufactures for. That's a lot of room for growth, but Ye is a man who likes to think big.
His aim to be the world's leading manufacturing partner for premium nutritional products from Australasia. He must be doing something right - GMP has more than 350 customers, employs 250 people, exports 55 per cent of turnover, and Ye is talking to potential investors for capital to further expand the company's production and warehousing capability.
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