Sleepyhead unveils big Australian expansion plans

Sleepyhead directors and owners Graeme Turner (l) and Craig (r) show Prime Minister John Key around their Auckland factory last week as part of their 75th birthday celebrations. Photo / Supplied

Sleepyhead, one of New Zealand's last big privately owned manufacturers, has unveiled aggressive expansion plans as it prepares to open a new $35m bed factory in Melbourne.

The company celebrated its 75th birthday last week, and has released details of its new factory and plans to start exporting beds to Sri Lanka and India.

Its new plant - Australasia's biggest - is due to open on December 1 and will use the same environmentally-friendly foam making technology that is in place at its Otahuhu headquarters in Auckland.

Sleepyhead director Graeme Turner said Australia was a key market for the bed manufacturer as it looked to boost production and stake its claim as a global brand.

"We are number one in New Zealand but our immediate goal is to be number one in Australia in three or four years," Graeme said.

Sleepyhead's Australian general manager Alistair McLaren said the company was also in the throes of negotiating a license that would allow it to sell beds into Sri Lanka and India.

"It will be small to start with, but the potential in that market is hundreds of millions, billions probably," he said.

Sleepyhead began exporting to Australia during the 1980s before moving into manufacturing in Brisbane in 1996.

Its latest Melbourne investment will give the company the capacity to double its Australian production.

"The great thing about Australia is it is the land of opportunity if you want to make it," Graeme's brother and fellow director Craig said.

"The interesting thing is Australia has got more New Zealand companies on its scrap heap, than you care to think about which tells you it's a really tough environment," he added.

The company has an eight per cent market share across the Tasman, with factories in Brisbane and Perth and now makes and sells more beds in Australia than it does in New Zealand.

Overall the company has more than 500 staff who produce more than 300,000 pieces of bedding across five plants in New Zealand and Australia each year.

However Craig was quick to point out that its expansion plans in Australia won't affect business here.

The company was committed to New Zealand, despite tough market conditions which had driven some manufacturers offshore, Craig said.

"We never believed in the China concept. We think the whole offshore thing is a short-term fix. We believe you can compete," he said.

The Turners said they knew of a couple of companies who had taken the plunge and moved their base offshore, only to return to New Zealand.

"The world is tough. It's not a sweet market out there, but there's always an answer, you've just got to find it," Craig said.

Graeme credits Sleepyhead's success to its willingness to embrace change and drive innovation, which included its decision to invest in a new $10 million plant at its Auckland headquarters last year.

The company uses liquid carbon dioxide instead of methylene chloride to produce environmentally friendly foam - the first machine of its kind in Australasia.

"For us it's very capital intensive," Graeme said.

"You have to be incredibly productive you can't be inefficient in New Zealand," Craig said.

Tragically a lot of New Zealand companies had not invested and they were inefficient, the Turners said.

"At the end of the day anything that is usually 75 years old is time to be put in a coffin. Not many companies stand the test of time," Graeme said.

"One of the big reasons we have survived is we embrace change," he said.

"This gives Graeme and I the passion to get up in the morning," Craig, who, with Graeme is the third generation of Turners to run Sleepyhead, added.