Ken McColl started at Cox Industries in 2003 after many years working his way up through the engineering department and onto the corporate ladder at companies such as Repco. Cox Industries is best known for its Australian-made ride-on mowers.
Cox Industries turned over more than $15 million last financial year and has 60 full-time employees at a time when most Aussie manufacturers are struggling. Despite the tough economic climate, McColl says Cox will never manufacture its products overseas. McColl spoke to SmartCompany about why keeping production onshore is the key to his business’s survival.
I joined Cox 12 years ago as managing director. It was a much different type of business compared with the big corporates I was used to as Cox is privately owned.
I wasn’t seeking this role but I was referred to the owners by a mutual business contact.
After discussing it with the owners I became quite excited.
I realised it absolutely suited my profile – which is make, sell and distribute. I’ve been doing that all my life.
The major difference between small, private companies and big corporates is corporates tend to have unlimited funds available for good projects and growth, whereas private businesses don’t necessarily have that funding and cash flow available. I’d say just about everything else is very similar.
One of my career highlights was automating a lot of our manufacturing processes and, specifically, the introduction of robots into the factory for wielding.
It enabled us to significantly reduce staff numbers in terms of direct wielders and enabled the company to be more competitive in the products we make. That was quite a big moment for us.
Our best marketing comes from our customers. We’ve been in business for 60 years and have tens of thousands of mowers out there in the field.
There’s a market demand out there for Australian-made products. Customers want it to be no less quality, they want it to be tough and with all the endurance features we’ve had over the years.
We have a very famous Cox brand. If we were to lower our specifications or compromise our quality in any way – and that includes having the product moved offshore – we would lose what the brand stands for.
My advice to a manufacturer finding it tough would be to focus on sales, marketing and distribution to ensure your product is relevant to the requirements of the market at any given time.
If you use “efficiency” as a verb, you can’t “efficiency” your way out of trouble. You have to have proper income, proper sales and proper growth to be able to survive and come out of trouble.
You have to get the fundamentals of your business right. A lot of people have good products and services for sale, but unless you have effective sales and distribution it’s a recipe for failure.
You have really got to focus on research and development if you’re a manufacturing company. Products have a lifecycle – even good products, wonderful products.
As part of that focus on the marketing, sales and distribution, make sure there’s new, fresh and relevant products coming out of your business all the time.
We have new models being developed for release in one year, in two years and even longer timeframes. We do exactly what the car companies do – have a very long plan for releasing mowers.
The key to profitability in our business is rainfall. When it rains a lot then the business really prospers.
When the mowing season begins we have to have a certain amount of stock ready in our warehouse. To have the right number of mowers in our warehouse to correspond to the seasonal conditions is the biggest headache.
Our market is basically all rural and regional areas. We sell to people who have acreage, people who live on lifestyle blocks and farmers.
A lot of our product is sold by people looking over the fence and saying, I think I want to buy one of those. So there are wonderful word-of-mouth outcomes for us in country towns where our product builds up a reputation.
Our dealers are also very supportive and speak very highly of our product.
We are also continuing to develop our website. The future is in the web and when people are buying anything these days, they always go to the internet for information and comparisons.