Taste of success on lips of many

By PAULA OLIVER

In a perfect business world, a speeding taxi would not be the preferred way to deliver export icecream in China.

But as Kiwi Ice Cream general manager Marcus Moore discovered, when you are taking your product to the vast country, anything can happen.

"I was asked why the icecream was shrinking, which is what happens after it has melted and the air has come out of it," he says.

"Then I discovered the delivery method was a taxi hurtling through the streets of China in 36-degree heat."

That was just one of many challenges Mr Moore faced when he took a crack at the Chinese market, and looking back with a smile, he says that being tenacious was a key to success.

A finalist in the Ernst & Young Entrepreneur of the Year award, the 29-year-old has been at the helm of the family-owned company since 1995.

In that time the business has doubled in size, largely due to risking a move to a larger manufacturing plant in another city.

The company is now positioned behind Tip Top as one of the second-tier ice-cream companies, employing 50 people during the high season.

"When I came in, the business had been ticking along but it needed a bit of TLC," Mr Moore says.

"We were manufacturing from a plant in Tauranga but I thought there was much more potential in the business than that."

Mr Moore's father owned the company for three years, after previously running a frozen foods distribution firm.

When Mr Moore did a feasibility study to identify growth opportunities, he could see that Tip Top's purchase of New American icecream meant there was a gap in the number two spot of the domestic market.

Despite closing many of the New American facilities, Tip Top was in a dominant position.

Mr Moore says the key to lifting Kiwi closer was increasing its production capacity, but he could not afford to build a new plant.

Believing that the risk was worth it, he borrowed cash to buy an existing plant in Auckland with four times the capacity of the Tauranga one.

"It was a hairy three months after we moved because with increased capacity comes increased overhead expenses as well," he says.

"It is also a far more sophisticated plant and it took us time to get on our feet."

The larger capacity allowed Mr Moore to go out and chase core business, including a major contract with a supermarket chain to make house brand icecream.

In a business heavily affected by seasonal highs and lows, such a contract is the bread and butter that keeps the plant running.

"We do try to compete on a price level with others, but we also have to be easier to deal with, and listen carefully to our customers," he says.

"Our speed to market is an advantage because we don't have layers of management and red tape to get through before we can make a decision."

Mr Moore says Kiwi is unlikely to overcome the goodwill that Tip Top has earned after being around for so many years, but it must be seen to have icecream just as good, if not better than the giant.

After ensuring regular business for the staple vanilla flavour, he says the focus moved to innovative products, such as the winner in the children's market, Blue Goo.

"Before we moved to the new plant, we were just doing the basics, and never had the chance to think about moving into new products.

"In the icecream world, if you're not innovative you will get left behind."

To target youngsters in the high season, Mr Moore developed a blue icecream with lollies in it, and commissioned a design team to come up with a cartoon character for it.

"I looked around and saw that blue was about the only colour that icecream didn't come in," he says.

"The packaging and design was really important, and in the end the kids responded really well."

But like any other product, icecream for children is a fad market.

After two years the fabulous new flavour is just not cool anymore, and another has to be found. As a consequence, Mr Moore is always working on new products.

He says that during the rapid growth of the past three years, it became more important to cross-skill staff so they know every area of the company.

No stranger to donning the white gumboots and hat himself, Mr Moore says he has worked hard to instil into management that battles are won or lost on the floor - not at the desk.

"Eventually I'd like to think everybody could do everything. We are reasonably small, so what skill we have is important to educate."

Widening the company's base of clients has been another focus, and he says each customer is analysed to see what can be gained from the business.

Making sure his portfolio is not dominated by a small number of clients is high on Mr Moore's hitlist.

Most of Kiwi's growth has come in the domestic market, with exports making up just 5 per cent of turnover.

A strong and loyal distribution network and sales team have been big factors in that, he says, particularly distributors who are not afraid to speak up when they hear a request.

The advantage of good distribution became clear in his first attempt at the Chinese market.

"We have been exporting to the Pacific Islands and Australia for years, and every year we get 50 or so export inquiries," Mr Moore says.

"We are careful to follow them all up, but by the time they see the costs of freight and things, not many actually come through."

However, the Chinese one did. Able to trade on New Zealand's clean, green image and reputation for top dairy products, Mr Moore set about delivering the fragile product to the temperate Chinese climate.

But "the goalposts kept moving."

"The critical thing was forming a relationship with a partner over there, but there can be communication problems and it's important to be tenacious. In the beginning we got it wrong when we sent two-litre cartons over and discovered they were too big for the Chinese take-home market."

He says that tenacity paid off once he managed to educate clients that icecream is fragile and needs careful transportation.

The Chinese business is now ticking over regularly, and he is looking to develop new products for the local fringe novelty market.

"I'd be stupid to think that I know everything at this age, but if I had some advice for young entrepreneurs, I'd tell them to get a network of mentors that you can float ideas past.

"I'm lucky that I've always been around business, but those people can bring you back to earth and remind you what is really important."