Supply Chain Sustainability

Build a Supply Chain that Delivers for Your Business and the Planet.

Sustainability is no longer just about compliance, it’s a business imperative that delivers cost savings, resilience, and long-term value. At Trace we bring the expertise to turn your sustainability ambitions into measurable results.

Ocean waves from above

The Business Case for Sustainable Supply Chains.

In today’s market, sustainable supply chain management is no longer a “nice to have.” Regulatory demands, shifting consumer expectations, and climate commitments mean your supply chain must be carbon-conscious, ethical, and resilient while still driving commercial results.

We help organisations across Australia and New Zealand embed sustainability into supply chain and procurement strategies. Our approach delivers measurable cost efficiencies, ensures compliance, and strengthens long-term resilience without compromising performance.

Eco friendly cardboard packaging

Why Supply Chain Sustainability Matters

🌱

Regulatory and Compliance Pressure

From Scope 3 emissions reporting to modern slavery laws and circular economy policies, sustainable chain management is fast becoming a compliance requirement.

🛍️

Consumer and Investor Expectations

Customers and investors increasingly choose brands with strong ESG performance. Sustainable supply chain management safeguards reputation, attracts investment, and builds loyalty.

💰

Cost Reduction and Resilience

Sustainable practices reduce waste, optimise energy use, and improve supply chain resilience helping you cut costs and future-proof operations.

Core service offerings

Our Sustainable Supply Chain & Procurement Services.

Unlike generalist sustainability consultants, we combine deep supply chain and procurement expertise with sustainability best practices, ensuring strategies are commercially viable and operationally effective.

Scope 3 Emissions Reduction Strategy

We help you measure, manage, and reduce emissions across your supply chain.

What we deliver:

  • Full emissions assessment across suppliers, logistics, and categories
  • Decarbonisation roadmaps aligned with Net Zero targets
  • Optimised transport, warehousing, and procurement to cut carbon
  • Supplier collaboration programs for joint sustainability gains

Sustainable Procurement & Ethical Sourcing

Ethical sourcing is now a business essential.

What we deliver:

  • Responsible sourcing strategies and procurement policy updates
  • ESG performance and risk assessment for suppliers
  • Modern Slavery compliance frameworks
  • Integration of sustainability criteria into procurement decisions

Circular Economy & Waste Reduction

Shift from linear to circular supply chain models.

What we deliver:

  • Closed-loop logistics and reverse supply chain models
  • Packaging optimisation and sustainable materials sourcing
  • Waste minimisation through better demand planning
  • Reduced emissions through smarter resource use

Green Logistics & Sustainable Transport

Lower your freight and logistics footprint.

What we deliver:

  • Warehouse and transport network optimisation
  • Evaluation of alternative fuels and electric fleets
  • Green last-mile delivery models
  • Emissions tracking and performance benchmarking

Sustainable Warehouse & Facility Design

Create energy-efficient, low-carbon operations.

What we deliver:

  • Solar, LED lighting, and smart HVAC integration
  • Automation to reduce energy consumption
  • Space optimisation to lower environmental impact

ESG Performance Benchmarking & Reporting

Robust reporting for stakeholders and regulators.

What we deliver:

  • ESG benchmarks and KPI frameworks
  • Sustainability tracking systems
  • Alignment with GRI, TCFD, and ISSB standards
  • Supplier ESG data collection and monitoring

Frequently Asked Questions

Common Questions About Supply Chain Sustainability.

Ask another question

Why should my organisation prioritise supply chain sustainability?

Embedding sustainability into your supply chain reduces risk, ensures compliance with evolving regulations, and meets growing consumer and investor expectations. It also delivers tangible business benefits such as cost savings through energy efficiency, waste reduction, and improved resilience against disruptions.

How can Trace Consultants help reduce Scope 3 emissions?

We conduct detailed emissions assessments across suppliers, logistics, and procurement categories, then develop a decarbonisation roadmap aligned with your Net Zero targets. Our strategies include transport optimisation, supplier engagement programs, and sustainable procurement initiatives that deliver measurable reductions in Scope 3 emissions.

What role does sustainable procurement play in ESG performance?

Sustainable procurement ensures that suppliers meet ethical, environmental, and social responsibility standards. This strengthens brand reputation, mitigates risks like modern slavery, and helps your organisation achieve higher ESG scores, making you more attractive to customers, investors, and stakeholders.

Is sustainability in supply chains more expensive?

Not necessarily. While some initiatives may require upfront investment, sustainable practices often lead to significant cost savings through reduced waste, optimised energy use, and improved operational efficiency. Over time, these efficiencies can outweigh initial costs and deliver strong returns on investment.

How do I get started with a sustainable supply chain strategy?

The first step is a clear understanding of your current environmental and social impact. We can help you assess your supply chain, identify quick wins, prioritise high-impact initiatives, and create a roadmap for long-term sustainability aligned with both your business objectives and regulatory requirements.

Get in touch with our sustainability specialists today.

Insights and resources

Latest Insights on Supply Chain Sustainability.

Sustainability

Emergency Services and Emergency Response Supply Chains: Building Capability, Speed, and Resilience in Australia & New Zealand

From bushfires to cyclones, emergency response supply chains in ANZ must be ready to act. Here’s how to design and run them for speed, resilience, and impact—and how Trace Consultants can help.

Emergency Services and Emergency Response Supply Chains: Building Capability, Speed, and Resilience in Australia & New Zealand

1. Why Emergency Response Supply Chains Matter More Than Ever

Emergency services in Australia and New Zealand—police, fire, ambulance, defence, search and rescue, and specialist disaster recovery teams—operate in high-pressure environments where supply chain performance can be the difference between life and death.

When bushfires tear through regional Victoria, when cyclones hit Far North Queensland, or when earthquakes strike Wellington, these organisations need the right equipment, in the right place, at the right time—every time.

Unlike most commercial supply chains, these networks must operate with uncertain demand, unpredictable timing, and extremely high stakes. They can’t wait for supplier lead times to catch up or for a normal procurement process to run its course. They require pre-positioned inventory, flexible capacity, and rapid mobilisation protocols.

At Trace Consultants, we’ve seen firsthand how well-designed emergency response supply chains can save critical hours, reduce operational risk, and improve outcomes for both responders and communities.

2. What Makes Emergency Response Supply Chains Different

While they share some fundamentals with commercial supply chains, emergency response supply chains have distinct characteristics:

  1. Unpredictable Demand Profiles – Events may be seasonal (e.g., bushfire season) or completely unforeseen (e.g., pandemics, large-scale accidents).
  2. Critical Service Levels – Performance isn’t measured in DIFOT percentages alone—it’s measured in lives saved, property protected, and operational continuity.
  3. Multi-Agency Coordination – Fire services, police, defence, local government, and private contractors often operate in the same network during a crisis.
  4. Geographic Reach – Coverage must extend into remote and difficult-to-access areas.
  5. Surge Capability – Ability to rapidly scale resources, transport, and personnel.
  6. Resilience to Disruption – Supply lines must remain functional during infrastructure failure, extreme weather, or security incidents.

3. The Building Blocks of an Effective Emergency Response Supply Chain

3.1 Pre-Event Preparedness

Preparedness is the foundation. This involves:

  • Demand Scenario Modelling – Understanding likely event types and volume surges.
  • Strategic Stock Positioning – Locating supplies in depots or forward bases close to risk areas.
  • Contracted Standby Resources – Agreements with suppliers and logistics providers to mobilise at short notice.

3.2 Real-Time Visibility

In emergencies, leaders need a live view of:

  • Current stock levels and locations.
  • Resource status (e.g., vehicles, medical teams).
  • Transport availability and estimated arrival times.

3.3 Flexible Sourcing and Distribution

Supplies may need to be redirected mid-transit or sourced from non-traditional vendors. Multi-modal transport (road, air, sea) is often critical.

3.4 Rapid Mobilisation Protocols

Clear processes for activating resources, escalating requests, and bypassing non-essential steps during emergencies.

3.5 Inter-Agency Collaboration

Shared platforms, data standards, and joint planning exercises improve coordination across organisations.

4. Common Weaknesses in Current Systems

Across Australia and New Zealand, emergency response networks sometimes face:

  • Fragmented Systems – Different agencies using incompatible technology platforms.
  • Lack of Stock Visibility – No single view of available assets across the network.
  • Over-Reliance on Manual Processes – Slowing down mobilisation.
  • Limited Surge Planning – Insufficient contracted capacity or pre-approved supplier arrangements.
  • Post-Event Bottlenecks – Slow replenishment after major events, leaving gaps in readiness.

5. Designing for ANZ Realities

5.1 Geography

Both Australia and New Zealand have vast rural areas, long distances between population centres, and regions prone to isolation during extreme events. Pre-positioning stock and mobile capability is essential.

5.2 Climate & Seasonal Risk

  • Bushfires in summer and early autumn.
  • Cyclones in the north during warmer months.
  • Flooding in low-lying areas.
  • Severe winter storms in alpine and southern regions.

APS-style scenario planning, adapted for emergency needs, allows agencies to forecast and plan for these patterns.

5.3 Cross-Border Support

State-to-state and trans-Tasman cooperation is common. Designing processes for asset sharing and redeployment improves resilience.

6. Technology’s Role in Modern Emergency Response Supply Chains

Technology is no longer optional—it’s an enabler for speed, coordination, and accountability.

  • Asset Tracking Systems – RFID or GPS to monitor critical equipment and vehicles.
  • Supply Chain Control Towers – Providing a live, integrated view of supply and demand.
  • Mobile Apps for Field Teams – To request, confirm, and receive supplies in the field.
  • Data Integration with Suppliers – Enabling automated replenishment triggers.

Trace Consultants works with agencies to select and implement fit-for-purpose solutions—ranging from full-scale planning systems to tactical low-code tools that can be deployed rapidly.

7. Workforce and Resource Planning

Emergency response isn’t just about physical supplies—it’s also about the people who operate the systems, equipment, and vehicles.

Effective workforce planning for emergency supply chains covers:

  • Skill Availability – Ensuring trained personnel are ready for mobilisation.
  • Shift & Rostering Systems – Balancing fatigue management with operational demand.
  • Cross-Training – Increasing workforce flexibility.
  • Volunteer Integration – Managing large-scale community volunteer involvement during crises.

8. Supply Chain Resilience Principles for Emergencies

To build resilience:

  1. Diversify Suppliers – Avoid dependency on a single source.
  2. Pre-Negotiate Contracts – Include surge pricing and mobilisation clauses.
  3. Build Redundancy in Transport Modes – Keep options open for road, rail, air, or maritime movement.
  4. Invest in Data Redundancy – Ensure systems remain operational even during power or connectivity loss.
  5. Run Regular Simulations – Test readiness under realistic conditions.

9. The Role of Private Sector Partners

Many emergency responses rely on private sector partners—logistics providers, construction companies, equipment suppliers—to augment government capabilities. Building strong, tested relationships is essential for quick mobilisation.

10. How Trace Consultants Can Help

At Trace Consultants, we help emergency services and supporting agencies design, optimise, and implement emergency response supply chains that are ready for real-world challenges.

Our support typically includes:

  • Current State Assessment – Reviewing readiness, resilience, and response capability.
  • Network Design – Determining optimal stock locations, depot layouts, and distribution flows.
  • Technology Selection & Deployment – Implementing tools for visibility, tracking, and scenario modelling.
  • Supplier & Contract Strategy – Creating agreements that enable rapid, scalable response.
  • Workforce & Rostering Integration – Ensuring personnel capability aligns with supply capacity.
  • Post-Event Review Frameworks – Capturing lessons and embedding continuous improvement.

Because we’re independent and vendor-agnostic, our recommendations are shaped solely around your operational needs and constraints.

11. Measuring Success

An effective emergency response supply chain can be measured by:

  • Mobilisation Time – How fast resources are deployed after an event trigger.
  • Fulfilment Accuracy – Whether the right supplies reach the right location.
  • Surge Capacity – Ability to meet peak demand without failure.
  • Post-Event Recovery – Speed of stock and capability replenishment.
  • Inter-Agency Coordination Scores – Quality of collaboration during joint responses.

12. Future Trends in ANZ Emergency Response Supply Chains

  • AI for Event Prediction – Using climate, social, and infrastructure data to forecast potential incidents.
  • Drones for Rapid Delivery – Especially in remote or inaccessible locations.
  • Sustainable Readiness – Balancing preparedness with environmentally responsible practices.
  • Digital Twins – Simulating emergency scenarios and testing supply chain response before a real event occurs.

Final Thoughts

Emergency services and emergency response supply chains in Australia and New Zealand operate under unique pressures. The stakes are higher, the conditions more unpredictable, and the margin for error far smaller than in most commercial contexts.

With the right design, governance, technology, and partnerships, these supply chains can deliver speed, resilience, and life-saving reliability. The key is preparation—because when the event hits, it’s already too late to start building capability.

Trace Consultants brings the strategic insight, operational depth, and practical delivery experience to help emergency services plan, adapt, and perform when it matters most.

Sustainability

Prudential Standard CPS 230 Overview: Mastering Supply Chain and Operational Risk Management

June 2025
Discover how APRA’s CPS 230, effective July 2025, reshapes operational risk management for Australian financial institutions. Learn about supply chain compliance, third-party risk, and how Trace Consultants can guide your organisation to resilience.

Supply Chains at the Heart of CPS 230 Compliance

In the fast-evolving Australian financial services landscape, supply chains are critical to operational success. From cloud computing platforms to payment processing vendors, financial institutions rely heavily on third-party and fourth-party providers to deliver essential services. However, this dependence introduces significant risks, from vendor insolvencies to cyberattacks. The Australian Prudential Regulation Authority’s (APRA) Prudential Standard CPS 230 Operational Risk Management, effective July 1, 2025, places supply chain risk management at the forefront of operational resilience.

For financial services companies and risk professionals, CPS 230 is a game-changer, requiring robust oversight of supply chain partners to ensure continuity and compliance. As a leading supply chain consulting firm, Trace Consultants is uniquely positioned to help Australian financial institutions navigate these requirements. This article delves into CPS 230’s supply chain focus, its implications, and how our expertise can drive your compliance success.

Understanding CPS 230: A Supply Chain Perspective

CPS 230 replaces CPS 231 (Outsourcing) and CPS 232 (Business Continuity Management), introducing a comprehensive framework for operational risk management. It applies to all APRA-regulated entities, including authorised deposit-taking institutions (ADIs), insurers, and registrable superannuation entity (RSE) licensees. Non-significant financial institutions (non-SFIs) have until July 1, 2026, to comply with certain business continuity and scenario analysis requirements.

The standard’s supply chain focus is driven by the growing complexity of financial services supply chains, which now include:

  • Third-Party Providers: Vendors providing critical services like cloud storage, cybersecurity, or claims management.
  • Fourth-Party Providers: Subcontractors (e.g., data centre operators) that support primary vendors.
  • Global Dependencies: Offshore suppliers introducing geopolitical and regulatory risks.

CPS 230 aims to:

  • Mitigate risks from supply chain disruptions, such as vendor failures or cyberattacks.
  • Ensure financial institutions maintain operational resilience through robust supply chain oversight.
  • Enhance business continuity planning to safeguard critical services.

Why Supply Chain Risk Management is Critical

Modern financial institutions rely on intricate supply chains to deliver services efficiently. However, these supply chains are vulnerable to disruptions, including:

  • Vendor Insolvency: Financial collapse of a key supplier, such as a cloud provider, can halt critical operations.
  • Cybersecurity Breaches: Third-party providers are prime targets for cyberattacks, risking data breaches and service interruptions.
  • Supply Chain Complexity: Fourth-party providers introduce hidden risks that are challenging to monitor.
  • External Shocks: Geopolitical events, natural disasters, or regulatory changes can disrupt global supply chains.

CPS 230 mandates a proactive approach to managing these risks, ensuring financial institutions can maintain operations and protect customers, depositors, and policyholders during disruptions.

CPS 230’s Supply Chain Requirements for Financial Institutions

CPS 230 introduces specific requirements to strengthen supply chain risk management. Below are the key obligations for financial services companies and risk professionals:

1. Identifying Material Service Providers (MSPs)

Financial institutions must identify material service providers (MSPs)—vendors critical to operations or posing significant risks. Examples include:

  • Cloud computing and IT infrastructure providers.
  • Payment processing or credit assessment vendors.
  • Fund administration or claims management services.

Key Actions:

  • Create and maintain a register of MSPs, submitted to APRA annually by October 1, 2025, for the first submission.
  • Assess materiality based on APRA’s criteria and the institution’s risk profile.
  • Map fourth-party providers to identify hidden supply chain dependencies.

2. Conducting Supply Chain Due Diligence

Robust due diligence is required before engaging MSPs, particularly for offshore and fourth-party providers. This includes:

  • Evaluating financial stability through financial statements and credit reports.
  • Reviewing cybersecurity measures, such as SOC reports and penetration testing results.
  • Assessing business continuity plans to ensure suppliers can withstand disruptions.

Key Actions:

  • Develop a supply chain due diligence framework tailored to CPS 230.
  • Document findings to support contract negotiations and APRA compliance reviews.

3. Strengthening Supply Chain Contracts

Contracts with MSPs must include provisions to ensure supply chain resilience, such as:

  • Access to critical systems and data during disruptions.
  • Clear obligations for business continuity and disaster recovery.
  • Mechanisms for ongoing performance monitoring and audits.

Key Actions:

  • Update existing contracts to comply with CPS 230 by the earlier of their renewal date or July 1, 2026.
  • Notify APRA before entering material offshore arrangements or significant contract changes.

4. Building Supply Chain Continuity Plans

CPS 230 requires business continuity plans (BCPs) to address supply chain disruptions. This includes:

  • Defining tolerances for disruptions to critical services (e.g., maximum downtime for payment systems).
  • Developing contingency plans, such as alternative suppliers or software escrow arrangements, to mitigate vendor failures.
  • Conducting scenario analysis to test supply chain resilience.

Key Actions:

  • Obtain board approval for BCPs aligned with the institution’s risk appetite.
  • Report significant supply chain disruptions to APRA within 24 hours.

5. Governance and Supply Chain Oversight

The board is responsible for overseeing supply chain risk management, ensuring:

  • No gaps in responsibility for third- and fourth-party provider oversight.
  • Regular reviews of MSP performance and supply chain resilience.
  • Prompt remediation of material weaknesses identified through audits.

Key Actions:

  • Establish governance structures for supply chain risk management.
  • Conduct independent audits to verify CPS 230 compliance.

6. Managing Fourth-Party Supply Chain Risks

CPS 230 extends oversight to fourth-party providers, which are often critical to service delivery. For example, a cloud provider’s subcontractor for data storage could disrupt operations if not properly managed.

Key Actions:

  • Map fourth-party dependencies within the supply chain.
  • Include fourth-party risk assessments in due diligence and monitoring processes.

Implications for Australian Financial Institutions

CPS 230’s supply chain focus has significant implications for Australian financial institutions:

  • Increased Compliance Costs: Mapping complex supply chains, updating contracts, and implementing monitoring systems require substantial investment.
  • Enhanced Resilience: Robust supply chain management reduces the risk of disruptions, protecting customers and stakeholders.
  • Regulatory Scrutiny: APRA will conduct prudential reviews starting in 2025-2026, with ongoing supervision by 2027-2028, focusing on supply chain compliance.
  • Competitive Edge: Institutions that proactively manage supply chain risks can differentiate themselves as reliable, resilient partners.

How Trace Consultants Can Help

As a leading supply chain consulting firm, Trace Consultants is uniquely equipped to help Australian financial institutions achieve CPS 230 compliance. Our deep expertise in supply chain risk management and operations ensures your organisation is prepared for this transformative regulation. Here’s how we can support you:

1. Supply Chain Mapping and Gap Analysis

We conduct detailed supply chain audits to:

  • Identify MSPs and fourth-party providers critical to your operations.
  • Assess current supply chain practices against CPS 230 requirements.
  • Deliver tailored roadmaps to address gaps, leveraging APRA’s “Day One Checklist.”

2. Supply Chain Due Diligence Expertise

Our team provides end-to-end support for due diligence, including:

  • Developing frameworks to evaluate supplier financial stability, cybersecurity, and resilience.
  • Assessing risks from offshore and fourth-party providers.
  • Documenting findings to ensure compliance with APRA’s expectations.

3. Supply Chain Continuity Planning

We design robust BCPs tailored to your supply chain, including:

  • Contingency strategies, such as software escrow, to mitigate vendor insolvency risks.
  • Scenario analysis and stress testing to identify supply chain vulnerabilities.
  • Board-approved plans that meet CPS 230’s disruption tolerance requirements.

4. Supply Chain Governance and Training

We help establish effective governance structures for supply chain risk management, including:

  • Defining roles for board and risk teams in overseeing third- and fourth-party providers.
  • Providing training for risk professionals on CPS 230’s supply chain requirements.
  • Facilit Canadá independent audits to address weaknesses.

5. Technology-Enabled Supply Chain Management

Our expertise in governance, risk, and compliance (GRC) software streamlines CPS 230 compliance. We:

  • Implement tools to manage MSP registers, automate incident reporting, and monitor supplier performance.
  • Integrate supply chain risk management into your operational risk framework.

6. Ongoing Supply Chain Monitoring

Trace Consultants offers continuous support to ensure sustained compliance, including:

  • Regular reviews of supply chain resilience and MSP performance.
  • Updates to risk management frameworks as regulations evolve.
  • Preparation for APRA prudential reviews and audits.

With our specialised focus on supply chain risk management, Trace Consultants is your trusted partner for CPS 230 compliance, ensuring your supply chain is resilient and regulatory-ready.

Practical Steps for CPS 230 Supply Chain Compliance

To prepare for CPS 230, financial institutions should prioritise the following:

  1. Map Your Supply Chain: Identify all third- and fourth-party providers, focusing on those critical to operations.
  2. Strengthen Risk Frameworks: Integrate supply chain risk management into your operational risk policies.
  3. Update Supplier Contracts: Ensure agreements include CPS 230-compliant provisions for continuity and monitoring.
  4. Leverage GRC Tools: Use software to streamline supply chain oversight and compliance tasks.
  5. Engage Stakeholders: Align board, executive, and risk teams on supply chain obligations.
  6. Partner with Trace Consultants: Tap into our supply chain expertise to develop tailored compliance strategies.

Challenges and Opportunities in Supply Chain Risk Management

Challenges

  • Complex Supply Chains: Mapping and monitoring fourth-party providers is resource-intensive.
  • Compliance Costs: Investing in due diligence, contract updates, and GRC systems can strain budgets.
  • Tight Deadlines: The July 1, 2025, deadline requires swift action to achieve compliance.

Opportunities

  • Resilient Supply Chains: Robust risk management ensures continuity during disruptions.
  • Customer Confidence: Compliance demonstrates a commitment to protecting stakeholders.
  • Market Differentiation: Early adoption of CPS 230 principles positions institutions as leaders in resilience.

The Future of Supply Chain Risk Management

CPS 230 sets a new standard for supply chain risk management in Australia’s financial services sector. As supply chains become more complex and interconnected, proactive oversight is essential to mitigate risks and ensure resilience. APRA’s focus on third- and fourth-party providers aligns with global trends, positioning compliant institutions to thrive in an evolving regulatory landscape.

By partnering with Trace Consultants, financial institutions can turn CPS 230 compliance into a strategic advantage, building supply chains that are robust, reliable, and ready for the future.

Partner with Trace Consultants for Supply Chain Success

APRA’s Prudential Standard CPS 230 is reshaping how Australian financial institutions manage supply chain risks. By prioritising third- and fourth-party oversight, the standard ensures operational resilience and regulatory compliance. For financial services companies and risk professionals, CPS 230 is an opportunity to strengthen supply chains and build trust with stakeholders.

At Trace Consultants, our supply chain expertise empowers Australian financial institutions to achieve CPS 230 compliance with confidence. From mapping complex supply chains to implementing robust continuity plans, we provide end-to-end support to ensure your organisation is prepared for July 2025 and beyond.

Ready to transform your supply chain for CPS 230? Contact Trace Consultants today at www.traceconsultants.com.au to start your compliance journey. Let’s build a resilient supply chain together.

Sustainability

Building Australia’s Manufacturing Future: Targeting High-Productivity Industries Amid Global Trade Uncertainty

May 2025
Global trade uncertainty challenges Australian manufacturers, but opportunities abound in high-productivity, low-labour industries like advanced manufacturing, clean energy, and critical minerals. This article explores how CEOs and Boards can leverage these sectors for growth, with insights from Trace consultants.

Building Australia’s Manufacturing Future: Targeting High-Productivity Industries Amid Global Trade Uncertainty

Navigating a New Era for Australian Manufacturing

Global trade is in flux. Geopolitical tensions, supply chain disruptions, and shifting trade policies—exemplified by events like U.S.-China tariffs and Indonesia’s nickel export bans—have created an unpredictable landscape. For Australian manufacturers, these challenges threaten competitiveness but also present a chance to rebuild the industry by focusing on high-productivity, low-labour sectors.

Manufacturing’s share of Australia’s GDP has dwindled to under 10%, down from 29% in the 1950s, largely due to high labour costs and competition from low-cost producers. Yet, with strategic focus, Australia can capitalise on its strengths—abundant resources, skilled workforce, and innovation ecosystems—to target industries where productivity trumps labour intensity. This article outlines key sectors—advanced manufacturing, clean energy, and critical minerals—and strategies to maximise productivity, with guidance on how Trace Consultants can help CEOs and Boards lead the charge.

The Global Trade Challenge: Why Manufacturing Matters

Global trade uncertainty exposes Australia’s reliance on imports for critical goods, from medical supplies to technology components. The COVID-19 pandemic highlighted this vulnerability, with supply chain bottlenecks disrupting access to essential products. Meanwhile, mercantilist policies in countries like China suppress wages and flood markets with cheap goods, undercutting Australian producers.

Manufacturing remains vital for economic resilience, job creation, and innovation. It drives productivity growth, historically outpacing services, and supports high-skill, high-wage jobs. For CEOs and Boards, revitalising manufacturing isn’t about returning to the 1960s but about targeting niches where Australia can compete on quality, innovation, and efficiency, not just cost.

Target Industries: Where Australia Can Win

To maximise productivity, Australia should focus on industries with low labour content or where advanced technologies and skilled workforces create competitive advantages. Three sectors stand out: advanced manufacturing, clean energy, and critical minerals.

1. Advanced Manufacturing

Advanced manufacturing leverages automation, AI, robotics, and 3D printing to produce high-value goods with minimal labour. Australia’s strengths—access to cutting-edge research through institutions like CSIRO and innovation hubs like the Australian Manufacturing and Materials Precinct (AMMP)—position it to excel in this space.

Key Opportunities:

  • Medical Technologies: Australia’s expertise in pharmaceuticals and biotech, exemplified by companies like CSL, supports high-value products like vaccines and diagnostics.
  • Aerospace and Defence: Firms like Austal demonstrate global competitiveness in shipbuilding and defence systems, driven by precision engineering.
  • Food and Beverage Processing: Automation in meat, dairy, and grain processing boosts output while meeting export demand.

Productivity Edge: Technologies like cobot welding and AI-driven quality control reduce labour needs while improving consistency. For example, automation upgrades in food processing have increased capital investment by 24.5%, enhancing output per worker.

How Trace Consultants Can Help: Trace Consultants designs automation strategies, from selecting AI tools to integrating robotics. We conduct feasibility studies, optimise workflows, and provide change management to ensure seamless adoption, helping manufacturers scale efficiently.

2. Clean Energy Manufacturing

The global transition to net zero creates demand for clean energy technologies, aligning with Australia’s abundant renewable resources and government support via the $22.7 billion Future Made in Australia plan. Programs like the $1 billion Solar Sunshot and $523.2 million Battery Breakthrough incentivise local production.

Key Opportunities:

  • Solar Panels: Scaling solar manufacturing to meet domestic and export demand.
  • Batteries: Producing high-value battery products for stationary storage, leveraging Australia’s lithium reserves.
  • Green Hydrogen: Developing production facilities for export to Asia and Europe.
  • Productivity Edge: Clean energy manufacturing relies on automated processes, like robotic assembly lines for solar panels, reducing labour costs. Australia’s proximity to critical minerals also lowers input costs.

    How Trace Consultants Can Help: We guide manufacturers through government incentives, develop supply chain strategies for raw materials, and implement digital twins to optimise production. Our expertise ensures alignment with sustainability goals and market needs.

    3. Critical Minerals Processing

    Australia holds 31 critical minerals, including lithium, cobalt, and rare earths, essential for batteries, electronics, and defence technologies. The $7 billion Critical Minerals Production Tax Incentive supports downstream refining, reducing reliance on foreign processing.

    Key Opportunities:

  • Lithium Refining: Building facilities to process lithium for battery production.
  • Rare Earths: Developing refining capabilities for magnets used in wind turbines and electric vehicles.
  • Nickel and Cobalt: Enhancing processing to counter Indonesia’s low-cost exports.
  • Productivity Edge: Automated extraction and refining technologies minimise labour while maximising output. Data analytics optimise resource use, cutting waste.

    How Trace Consultants Can Help: Trace Consultants maps supply chains for critical minerals, negotiates partnerships with global buyers, and integrates AI-driven processing systems. We ensure compliance with environmental standards, enhancing market access.

    Strategies to Maximise Productivity

    Targeting the right industries is only half the battle. Manufacturers must adopt strategies to enhance productivity, leveraging technology and innovation to stay competitive.

    1. Embrace Industry 4.0 Technologies

    The fourth industrial revolution—encompassing AI, IoT, and automation—enables manufacturers to optimise processes and reduce labour dependency. For example, predictive maintenance using IoT sensors can cut downtime by 15-20%.

    Applications:

  • Smart Factories: Integrate IoT for real-time monitoring of equipment and inventory.
  • AI Analytics: Forecast demand and optimise production schedules.
  • Robotics: Automate repetitive tasks in assembly and packaging.
  • How Trace Consultants Can Help: We assess your operations, recommend Industry 4.0 solutions, and manage implementation. Our training programs ensure your workforce adapts to new technologies, driving productivity gains.

    2. Build Resilient Supply Chains

    Global trade uncertainty demands robust supply chains. Manufacturers can mitigate risks by:

    • Localising Production: Reshoring critical components to reduce reliance on volatile imports.
    • Diversifying Suppliers: Partnering with regional suppliers to avoid single-point failures.
    • Digital Supply Chains: Using blockchain for transparency and traceability.

    How Trace Consultants Can Help: We conduct supply chain diagnostics, design resilient networks, and implement digital tools like advanced planning systems (APS). Our expertise ensures continuity and cost efficiency.

    3. Invest in Workforce Upskilling

    High-productivity industries require skilled workers adept at managing advanced technologies. Australia’s declining birth rate (1.6, below the 2.1 replacement level) underscores the need for a tech-savvy workforce.

    Approaches:

  • Training Programs: Partner with universities and TAFEs for Industry 4.0 skills.
  • Cross-Industry Recruitment: Attract talent from tech and engineering sectors.
  • Soft Skills: Emphasise teamwork and problem-solving to enhance innovation.
  • How Trace Consultants Can Help: We develop tailored upskilling programs, collaborating with educational institutions and industry bodies. Our change management strategies foster a culture of continuous learning.

    Overcoming Challenges: A Strategic Approach

    Building manufacturing in these sectors faces hurdles:

    • High Upfront Costs: Automation and clean energy facilities require significant investment.
    • Skills Shortages: 95% of manufacturers report difficulty attracting skilled labour.
    • Global Competition: Low-cost producers like China challenge price competitiveness.

    CEOs and Boards can address these by leveraging government incentives, like the National Reconstruction Fund, and focusing on niche, high-value products. Collaboration with innovation hubs and global partners also enhances competitiveness.

    Why Partner with Trace Consultants?

    At Trace Consultants, we empower Australian manufacturers to thrive in a volatile global market. Our services include:

    • Strategic Planning: Identifying high-productivity opportunities in advanced manufacturing, clean energy, and critical minerals.
    • Technology Integration: Implementing AI, IoT, and automation for maximum efficiency.
    • Supply Chain Optimisation: Building resilient, digital-first supply chains.
    • Workforce Development: Designing upskilling programs to bridge skills gaps.

    Our data-driven, collaborative approach ensures solutions are tailored to your business, delivering measurable ROI. Whether you’re scaling a clean energy venture or automating a factory, we provide the expertise to succeed.

    A Future Made in Australia

    Global trade uncertainty is a wake-up call for Australian manufacturing. By targeting high-productivity, low-labour industries—advanced manufacturing, clean energy, and critical minerals—Australia can rebuild its industrial base. Embracing Industry 4.0, resilient supply chains, and skilled workforces will ensure competitiveness without relying on low-cost labour.

    CEOs and Boards must act now, leveraging government support and expert guidance to seize these opportunities. Contact Trace Consultants today to transform your manufacturing strategy and build a future-proof business.

    Start a conversation

    Let's Build a Sustainable Supply Chain That Performs.

    Sustainability is now a driver of resilience, cost efficiency, and growth. We design and implement strategies that strengthen your supply chain while reducing its environmental impact.

    Enquire today to start building a sustainable supply chain that works for your business and the world.

    Three men in suits standing in front of the Sydney Harbour Bridge