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Audrey Young

Audrey Young is the New Zealand Herald’s political editor.

'Huge money generator' - Mainfreight's US dream

If Mainfreight can get 1 per cent of the US market it might leave New Zealand figures for dead, says Jason Braid.  Photo / Sarah Ivey
If Mainfreight can get 1 per cent of the US market it might leave New Zealand figures for dead, says Jason Braid. Photo / Sarah Ivey

Jason Braid, of Mainfreight USA, apologises in advance to any Americans he might offend.

He is talking to a seminar in Los Angeles run by New Zealand Trade and Enterprise, to an audience of mainly Kiwis about setting up business in the US.

"I love this country but it's different from New Zealand," he said. "We may look the same but we are a different breed and it is important to understand that."

Braid is the son of Mainfreight group managing director Don Braid - the Herald's Business Leader of the Year in 2011.

Jason was born in 1978, the year that chairman Bruce Plested founded Mainfreight. He is international sales director for the division, based in LA - one of 34 Mainfreight branches in the US.

Jason Braid arrived in the US 7 years ago to run the Chicago operation.

It was a big change from Christchurch where, he said, there were plenty of Mainfreight reps scrambling for $20,000 a year contracts.

"[Up here] you pick up an account on every corner worth a couple of million bucks. That's how big it is," he said. "I love the USA and it's a great place for New Zealand business to be."

But they struck a few difficulties in the US when they came up against the Mainfreight culture of financial transparency in each branch, acting fast, and empowering staff to make decisions.

The bureaucracy in the US slowed things down - red tape, unions and working with the legal system.

Accounting difference made for hard work when they first arrived, with only a few bosses knowing monthly figures.

"At Mainfreight we live and die by weekly accounting - every single Monday we have to report our numbers back to New Zealand and every single week we know how much we are making around the world ... we want everyone in the branch to see what the results were for the week, good or bad."

He also found that a lot of people had been afraid to make decisions. Everything went through managers and managers' managers, again slowing down business.

Mainfreight was "massive" on empowering team members.

"We want people at the coalface making decisions right then and there, rightly or wrongly," he said. "There's nothing more powerful than a customer ringing up with a problem and that person on the phone being able to solve it right there."

Its US subsidiary CaroTrans, which it fully acquired in 2003, is run separately and has 14 branches.

Braid said he struggled with selling LA on a personal note "but I am passionate about the USA".

Braid's presentation at the seminar came just a few days before last week's results which showed earnings overall have stalled because of difficulties in the European arm of the business, despite record sales in most other places.

In the Americas revenue improved 7.6 per cent to US$357.49 million ($449.15 million) and earnings before interest, tax, depreciation and amortisation lifted by 10.5 per cent to US$16.92 million.

"While this is satisfactory growth", the results statement said somewhat clinically, "our expectations have yet to fully materialise".

Or as Braid put it: "We are making a lot of money now and we foresee that as just continuing. We see this as a huge money generator for us."

Mainfreight has opened offices in Toronto, Canada and Mexico City in preparation for further growth.

The competition was big and tough, he said, but it could also be a little slow.

Mainfreight had a very small part of the market and that made it easier in some respects. If it had had 100 per cent of the market when the global financial crisis struck it would be in trouble.

"But we are such a small percentage of the market, it's up to us to control our own destiny," he said. "If we can get 1 per cent of the market we might leave New Zealand figures for dead."

Half of Mainfreight's business in the US was domestic and half international.

Third-party logistics was a huge part of the business and they used such warehouses in all the main centres in the world where Mainfreight was based.

It offered a pick and pack service in which it could act on behalf of a New Zealand company without a physical presence, delivering their product around the states in a couple of days. It also offered Customs brokerage services.

Jason Braid encouraged more New Zealand businesses to grow into the USA.

"There's a lot of hidden opportunities in the USA and it's not until you are here and you've got your feet on the ground that you actually find where those opportunities are."

- NZ Herald

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