Australia’s import bill has been cut and a successful new business created – thanks to a car fabric designer who thought there was a better way to service customers.
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Entrepreneur: Liz Reece, General Manager
Company: Autofab Australia
Business type: Automotive textile design and fabric manufacture
Founded: 1996
Employees: 35
Turnover: $12M
Head office: Mulgrave, Victoria
Contact details: +61 3 9560 2488
The Autofab Story
Liz Reece, a Melbourne-based textile designer, knows her industry as an insider - she designs fabrics for car interiors. And Reece also knows a business opportunity when she sees one.
In 1994, after spending four years with Nissan in the colour and trim design area, Reece began working part-time in Melbourne for the Japanese trading house, Toyota Tsusho. As a designer, merely importing fabrics frustrated her. The quality of the imported product was inconsistent and car companies were dissatisfied with the long lead times for delivery.
Reece says: “When I first started at Toyoto Tsusho, there was an 18–22 week lead time and then we would dump a whole container-load of fabrics on Toyota’s doorstep. We just weren’t able to provide the service that was required. Because of my time at Nissan, I knew the competitors and I knew the standards. I saw a big opening in the market for locally designed and manufactured fabrics. I knew that we could do it better ourselves.”
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Key learning points:
- Industry knowledge - It is impossible to understand customers without understanding their industry. Be well briefed. At meetings, try to avoid saying “I’ll look into that and get back to you”.
- Staff commitment - Hire the right people. Cultural diversity is good but staff members need to share a work ethic. The best staff work hard and get an adrenalin kick from doing a good job.
- Management style - Stay in tune with staff by working closely with them. Sometimes, managers and staff need to get their hands dirty - together. Everyone shares a sense of accomplishment when a team comes through a difficult time.
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Reece pitched the concept of an Australia-based specialty fabric business to Toyota Tsusho. The trading house wanted to add value and liked the prospect of dramatically shorter lead times, better design and better fabric for its customers. Autofab was formed in 1996, with Toyota Tsusho and Reece working with two small Melbourne-based businesses, which handle knitting and finishing.
In 1998, the company won its first big contract - to provide fabric for some of Holden’s police utility vehicles. Turnover has climbed from $500,000 in calendar 1998 to $12.3 million in calendar 2002. Toyota is still Autofab’s biggest customer, followed by Holden. In 2000, Autofab set up its own factory in Mulgrave, Melbourne to meet the heavy demand for its car interior fabrics.
Autofab has won many textile design awards. In early 2003, the company was inducted into Victoria’s Manufacturing Hall of Fame. Reece says the company’s success is based on good design and a focus on meeting customer needs. “Being local, we can be very responsive. We can make the seat and door-trim fabrics in four weeks. But it’s also about attention to detail. If you say that you’re going to produce a sample with a slightly different colour on a particular day, you actually do it. You come to meetings knowing every detail. We know what it’s like to be let down and not get the answers.”
Reece says that, as general manager, she has difficulty delegating, but makes no apologies - her direct involvement suits the size and nature of the business. “I’m still in the weekly production meetings and we’re all there questioning each other. It makes everyone very committed to what they’re doing. I think the company is at a stage where this kind of immersion in the business is still effective as a management style.”
Language and cultural differences still cause headaches in communications between Reece and her Japanese business partners. But Reece says she has a great deal of autonomy. “They have pretty much let me go for it, even though they kind of scratch their heads sometimes. My philosophy has been: just do it, get the numbers, get the business.”
Keeping a 24-hour textile design and manufacturing operation running smoothly is difficult. Reece says that recently the pace has been frenetic. She says that most business decisions are easy; it is the people issues that can be difficult. “Staff often need more time than you think they need. Being with them motivates them. You have to be close enough to hear the mood of the place.”