A Region Seeking Reinvestment — and a Chinese Brand Seeking Quality
The Hauraki Plains, a vast alluvial lowland in New Zealand’s Waikato region, has long been a cornerstone of the nation’s dairy industry. For decades, the small town of Kerepehi was anchored by a large dairy processing factory — a source of employment, community identity, and economic vitality for the surrounding rural area. When that factory closed in 1991, the consequences were severe. Employment declined sharply, families relocated to larger centres, and the once-thriving industrial site sat dormant for over two decades, a 6,470-square-metre reminder of what the district had lost.
By the early 2010s, the Hauraki District Council (HDC), under the leadership of Mayor John Tregidga, was actively seeking opportunities to attract new industry and reverse the district’s economic trajectory. The council had cultivated strong international relationships over many years, including a sister-city agreement with Jiading province in China, signed in 2000. Mayor Tregidga had personally visited China eight times in the years following that agreement, building the kind of trust and goodwill that would prove critical when a major opportunity finally emerged.
The Hauraki Plains have been a cornerstone of New Zealand’s dairy industry for generations, providing the ideal environment for high-quality milk production.
A Chinese Giant Seeks World-Class Ingredients
Simultaneously, a major Chinese agribusiness group was looking to expand its operations internationally. Allied Faxi Food Company, a subsidiary of the state-owned Beijing Capital Agribusiness Group, was the producer of Baxi (八喜), a beloved ice cream brand with strong market recognition in Beijing and across northern China. The company’s parent, Sanyuan Group, was founded in 1956 and is one of China’s most established state-owned dairy enterprises.
The timing was significant. The Chinese consumer market was undergoing a profound transformation. Rising disposable incomes and a series of high-profile domestic food safety scandals had created an insatiable appetite for safe, premium, and internationally sourced food products. Between 2008 and 2014, the total market value for ice cream in China had nearly doubled, growing by 90 percent to reach USD $11.4 billion — making China the fastest-growing ice cream market in the world.
Source: Food Engineering Magazine, 2015. Market values are approximate and represent total retail sales.
For Allied Faxi, manufacturing in New Zealand offered a compelling strategic proposition: access to world-class dairy ingredients, the prestige of the “clean, green” New Zealand brand, and a platform for premium export products. In July 2013, Allied Faxi approached the Hauraki District Council about establishing a manufacturing presence in New Zealand. Hauraki was one of four locations on the company’s shortlist. By the end of that year, the company had selected Kerepehi — drawn by its existing industrial infrastructure, proximity to high-quality dairy supply, and the council’s proactive and welcoming approach. It was to be Allied Faxi’s first investment outside of China.
Navigating the Gap Between Two Very Different Business Worlds
The opportunity was transformative, but the path to realising it was fraught with complexity. Bringing a major Chinese state-owned enterprise into a small New Zealand district required navigating a web of cultural, linguistic, regulatory, and commercial challenges that neither party could resolve alone. Without expert facilitation, the project risked stalling at any one of several critical junctures.
Fundamental differences in business etiquette, communication styles, and negotiation protocols created a significant risk of misunderstanding. Without skilled bilingual mediation, the relationship between the council and Allied Faxi could not progress beyond surface-level discussions.
The Hauraki District Council needed absolute certainty about Allied Faxi’s legitimacy, financial capacity, and long-term commitment. Verifying the corporate structure and state-owned enterprise status of a Chinese company required specialist knowledge and in-country connections that the council did not possess.
New Zealand’s building codes, environmental regulations, and food safety standards are rigorous and complex. Allied Faxi’s preference for using Chinese contractors — familiar to them but unfamiliar with local requirements — posed a serious risk of non-compliance and costly delays.
The council’s priorities centred on sustainable local employment and community development, while Allied Faxi’s focus was on commercial returns and brand enhancement. Bridging these different objectives required careful and sustained relationship management over an extended engagement period.
Bridging Culture, Language, and Commercial Expectation
Eastern Bridge was contracted by the Hauraki District Council to assist with migrant engagement and Asian business liaison. Through this role, Eastern Bridge became the central facilitating force in the Allied Faxi investment, working across an 18-month engagement to build trust, ensure transparency, and drive the project to a successful conclusion. The approach was structured around four interconnected workstreams.
Eastern Bridge conducted a thorough investigation into Allied Faxi’s corporate structure, confirming its status as a subsidiary of the state-owned Beijing Capital Agribusiness Group. This included assessing the company’s financial health, industry reputation, and ownership chain — including the significant role of Beijing Sanyuan Foods, a major state-owned dairy enterprise listed on the Shenzhen Stock Exchange. The verification process gave the Hauraki District Council the confidence to commit to the partnership and to invest in the necessary infrastructure upgrades.
Eastern Bridge provided fluent Mandarin and English interpretation across all meetings, negotiations, and site visits. Beyond translation, Eastern Bridge offered nuanced cultural advisory services to both parties — guiding the council on Chinese business protocols and helping Allied Faxi understand the expectations and values of New Zealand’s local government environment. This cultural intelligence was instrumental in preventing misunderstandings and building a genuine relationship of mutual respect.
A pivotal moment in the engagement was the facilitation of a formal delegation to Beijing. Eastern Bridge organised and accompanied a team comprising Mayor John Tregidga, a district councillor, and Economic Development Manager David Fielden. The delegation met directly with Allied Faxi’s chairman and senior directors, discussing investment requirements, production planning, and site logistics. This face-to-face engagement, conducted in Mandarin with Eastern Bridge’s support, was decisive in securing Allied Faxi’s final commitment to the Kerepehi site.
Eastern Bridge provided critical strategic advice throughout the project, including a firm recommendation that Allied Faxi engage New Zealand-based engineering and consulting firms for the factory’s design and construction. The investors initially resisted this guidance, citing the higher cost of local expertise. Eastern Bridge held firm, arguing that compliance with New Zealand’s building codes, environmental regulations, and food safety standards was non-negotiable — and that only local professionals could reliably navigate these requirements. This advice proved essential to the project’s smooth execution.
Mayor John Tregidga with Allied Faxi representatives. The council’s proactive engagement and long-term relationship with China were critical to attracting this landmark investment.
“Eastern Bridge strongly advised that the investors engage New Zealand-based engineering and consulting firms. Although this recommendation initially faced resistance due to higher costs, the advice proved essential — without local expertise in building compliance, environmental regulations, and infrastructure planning, the project would likely have faced major delays.”
Simon Appleton — Eastern Bridge LimitedServices Delivered by Eastern Bridge
- Mandarin interpretation across all meetings and negotiations
- Translation of technical and legal documentation
- Cultural advisory to both parties throughout the engagement
- Trust-building and relationship management
- Corporate structure and ownership verification
- State-owned enterprise status confirmed
- Industry reputation and financial capacity assessment
- Risk identification and mitigation advisory
- Organised and accompanied Beijing delegation
- Arranged meetings with Allied Faxi chairman and directors
- Ensured culturally appropriate communication at all levels
- Confirmed investment terms and site selection
- Developed structured engagement plan for the council
- Coordinated with local stakeholders and service providers
- Advised on NZ regulatory and compliance requirements
- Managed investor expectations throughout the 18-month process
A $30 Million Investment and Its Ripple Effects Across the Hauraki Region
Construction on the new factory began in June 2015, and the facility was officially opened in December 2016. The $30 million capital investment flowed through the regional economy during the construction phase, supporting a wide range of local businesses and service providers. Land Information New Zealand’s overseas investment approval confirmed the investment’s significance, citing job creation, increased export receipts, added market competition, and increased processing of primary products as key benefits to New Zealand.
The completed Allied Faxi (Baxi) factory at Kerepehi Industrial Park — a state-of-the-art food manufacturing facility built on the site of a former dairy processing plant.
Construction Phase Investment Breakdown
The $30 million capital investment was distributed across a wide range of regional businesses and sectors during the construction phase, providing an immediate economic stimulus to the Hauraki District and wider Waikato region.
Estimated distribution based on LINZ overseas investment decision and industry benchmarks for food manufacturing projects of comparable scale.
Annual Economic Impact
Once operational, the factory created approximately 50–55 full-time jobs, with General Manager Arthur Yan confirming that all employees were sourced locally. Based on an average manufacturing wage of NZD $65,000 per year, the factory’s total annual payroll is estimated at $3.25 million. Applying a conservative economic multiplier of 1.8 — consistent with regional economic modelling for manufacturing industries — this payroll generates an estimated $5.85 million in total annual economic impact for the Hauraki District. Combined with estimated annual export revenue of $20–30 million, the factory’s total regional contribution is estimated at $25–40 million per year.
Payroll estimate based on 52 FTE at average NZD $65,000. Multiplier of 1.8x applied per regional economic modelling conventions. Export revenue based on LINZ decision and company reporting.
The Economic Multiplier Effect
Total Regional Economic Contribution
Estimated Regional Economic Contribution
From Dormant Site to Award-Winning Export Facility
The Allied Faxi investment delivered outcomes that exceeded the Hauraki District Council’s original objectives. The factory not only revitalised a derelict industrial site but also produced internationally recognised products, created a new competitive dynamic in the local dairy supply chain, and provided a powerful signal to other potential investors that regional New Zealand was open for business.
A NZD $30 million facility was established at the former Kerepehi dairy processing site, revitalising dormant industrial infrastructure that had been vacant for over two decades.
Approximately 50–55 full-time manufacturing positions were created, all filled by local Hauraki residents. For many families, this meant an end to long commutes or a return home from larger cities.
The factory produces premium ice cream for export to China, generating significant annual export revenue. By its second full year of operation, net income had exceeded NZD $20 million.
In May 2018, the factory’s G’nature brand ice creams won Gold and Silver awards at the 22nd New Zealand International Ice Cream Contest — a remarkable achievement for a factory in only its second year of production.
The factory’s G’nature brand ice creams — produced using locally sourced New Zealand milk — won Gold and Silver at the 22nd New Zealand International Ice Cream Contest in 2018.
Wider Community and Regional Effects
Beyond the headline economic figures, the Allied Faxi investment had a profound and lasting impact on the social fabric of Kerepehi and the surrounding Hauraki Plains. As one local Māori resident, who had witnessed both the factory’s original closure and its rebirth, described it: “When they (old factories) were closed, a lot of families moved away. So now we’ve got a lot coming back home and working here, and it’s good.”
Mayor John Tregidga reflected on the broader significance: “What the Chinese company is doing is not only helping employment for our people, but also giving confidence to our community… We are seeing unemployment go down. We are increasing the GDP above the national average.”
| Impact Area | Outcome | Status |
|---|---|---|
| Site Revitalisation | Dormant 6,470m² factory site transformed into modern food manufacturing facility | Achieved |
| Employment | 50–55 full-time local jobs created; population stabilisation and return migration observed | Achieved |
| Export Revenue | Annual net income exceeded NZD $20M by year two; projected to exceed $30M | Achieved |
| Dairy Market Competition | New buyer for local dairy products, introducing competition into a Fonterra-dominated supply chain | Achieved |
| Infrastructure Upgrade | Council investment in water treatment upgrades enabled industrial-scale food processing | Achieved |
| Product Recognition | G’nature brand won Gold & Silver at 22nd NZ International Ice Cream Contest (2018) | Achieved |
| Investor Confidence | Investment signalled regional NZ as viable destination for international FDI | Achieved |