Turf-maker has export market covered

by YOKE HAR LEE

What can a small Onehunga company that makes synthetic grass for the sporting industry teach other Kiwi manufacturers?

The most obvious lesson is the grass can indeed be greener on the other side for those who venture far.

Realising the limitations of New Zealand's small domestic market, Astrograss Allweather Surfaces has made it a point to reach out to far places in the world.

The competition in the synthetic grass industry is intense. But this has not fazed the founder of Astrograss, Graham Vivian.

The company, started in 1981, has not only cornered a sizeable share of the New Zealand synthetic grass market, but chalked up impressive export sales.

Exports now make up 50 per cent of its business, involving 20 countries around the world.

Mr Vivian said the company had been profitable all but one year since its inception.

A former international cricketer for New Zealand, Mr Vivian said the company's export business had been growing over 50 per cent a year for the last three years.

Export growth was still robust, although it might not be realistic to expect this pace to continue.

The company is the only New Zealand manufacturer of synthetic grass surfaces.

Realising local limitations very early, it targeted countries that most major competitors had missed.

Astrograss has exported to countries such as Hong Kong, Malaysia, Singapore, Indonesia, China, Taiwan and Mauritius, plus Pacific islands and Europe.

Its synthetic grass covers tennis courts, cricket wickets, soccer stadiums, hockey grounds and bowling lawns.

The business started almost by chance. Mr Vivian was in Australia when he first spotted synthetic surfaces.

"I decided to put in a synthetic grass [tennis] court for myself."

He talked to the local industry and decided there was a market for synthetic grass courts for tennis clubs in New Zealand.

With business partner Terry Jarvis, he had the grass manufactured under contract by Cavalier's former company, UEB Bremworth, because the process was similar to making carpets.

But by 1984, Astrograss had put in its own manufacturing facilities. Business took off.

One of the key elements to the company's staying power - other New Zealand firms trying to do the same rose and fell overnight - was having a key technological partner in Dutch company Desso, a leading manufacturer of polypropylene fibre.

When the Federation of International Hockey ruled in 1989 that all international hockey must be played on synthetic surfaces, Astrograss was able to capitalise on the move because of its ability to returf hockey fields.

The exchange of ideas and cooperation with Desso in product development worked well for Astrograss.

Desso's focus on the technology led to a revolutionary product called Grass Master, where synthetic grass is weaved in with the natural turf.

As a result, the turf lasts four times longer than natural grass even though the ratio is 97 per cent natural to 3 per cent synthetic.

Mr Vivian said he was now talking to Australian horseracing tracks interested in using the product.

Local innovation has been a feature of Astrograss. The company developed and patented a vertical drainage system and special porous carpet for sports bowls, now used in more than 100 installations.

The workfloor played a big part in how well Astrograss did things, said Mr Vivian. Technical staff helped with innovations that improved manufacturing.

Astrograss competed not only with about seven Australian companies, but what used to be up to 40 worldwide.

The number had shrunk to about 20 and this was likely to contract further, he said.

Building a fast-growing company brought problems. Banks often did not understand what his business was all about.

"It is hard to explain the business to banks, especially when there aren't any examples around. They couldn't compare us with another person down the road."

Finding employees who were interested in sports and understood the needs of sports proved surprisingly difficult in this sports-mad nation.

Mr Vivian said finding the right partners in the countries where Astrograss operated had been critical to success.

"In China, for instance, we send our technical staff there to make sure the local distributor understands the requirements and conforms to them."

What irked Mr Vivian about being a company so dependent on exports was the lack of help from the Government despite all the hype about wanting to grow exports.

He said he could easily shift to Australia.

"[With] the services and incentives there, it makes you wonder why we are not in Australia. We are looking at it but at the moment we are still a New Zealand-based company.

"From a purely financial point of view, there are far more benefits being in Australia."

He was also not impressed at having to pay for services offered by the New Zealand Trade Development Board - something that his Australian and other global competitors did not have to do.

Astrograss was exploring the opportunities available in South America, especially Chile.

"We have to pay Trade NZ to set up appointments to find potential customers. Then we have to pay them if we want them to attend the meeting and pay for the interpreter.

"If I were in Australia, I would get all of those for free, plus I would get export incentives.

"New Zealand has to get off its backside to export. But there is nothing to assist those of us who actually do it.

"For small companies wanting to export, it is difficult.

"The cost of running a company plus the compliance costs, that is all very frustrating."

But small companies were often disadvantaged in that they could not afford to absorb any of the perils associated with exporting to riskier places, he said.

"The alternative is to fall back on traditional forms of financing like letters of credit, but that isn't going to be attractive to potential customers."

One of the bitter lessons Mr Vivian learned was being too ambitious in targeting the US market.

"We had a go but got our fingers burned when competitors ganged up on us."

So Astrograss' sights were mostly set elsewhere, where other big players were not so active.