Wetsuit maker takes on world

His big idea was wetsuits with sleeves for triathletes. DITA DE BONI talks to the man who turned that idea into a global business.

He is not a triathlete, but he founded a company that now commands the largest share of the global triathlon wetsuit market.

He surfs "just as much as most Kiwi guys, which is from time to time," and his aim is to take the next 10 years to expand his niche range and become the largest supplier of multipurpose wetsuits in the world.

He is Andy Mundell, who, 10 years ago, decided there was a gap in the global triathlon wetsuit market.

He had no qualms about the viability of a small, Auckland-based operation filling that need from a remote corner of the South Pacific.

Ponsonby-based Ironman Wetsuits has annual sales of around $US6 million ($14.2 million). It holds around 40 per cent of the US market and 30 per cent of the world market in wetsuits specially designed for the gruelling, multidisciplined sport of triathlon. About 85 per cent of its product is exported.

The company has just launched a Hybrid brand wetsuit, which aims to scoop the pool across a range of sports, including surfing, boogie boarding and snorkelling.

Mr Mundell and his business partner Lee Nicolson - both former travel industry workers - went into business in the early 1990s after travelling to North America and Europe to research their market.

The large, mostly California-based wetsuit providers such as Quintana Roo and O'Neills had become complacent, according to Mr Mundell. He thought he could see a way for a little fella to creep up behind the bigger players and beat them using innovation.

Crucially, he saw a gap in the market for triathlon suits with sleeves. Traditionally, suits for the sport were sleeveless because the diehards believed an allover wetsuit restricted the swimming stroke and caused muscle fatigue.

But the downside of the old design was that it let in water through the armholes and was not particularly buoyant.

Back in New Zealand, and using seed capital gleaned from a variety of sources, the pair devised the sleeved wetsuit they hoped would take the world by storm.

But its very existence created a marketing dilemma. "We had to then go and educate the market that our triathlon wetsuits with sleeves would be more effective."

They spent a lot of money, doing things like attending trade shows, especially the SuperShow in Atlanta, the world's largest sports trade show.

While trade shows proved lucrative hunting grounds, another marketing coup cemented the company's success.

It managed to strike a licensing deal with the World Triathlon Corporation, owners of the Ironman brand - one of the most successful in the world.

Both the brand licence and other associated costs left the pair "hundreds of thousands" of dollars out of pocket. But Mr Mundell knew they were on to a winner.

"Being aligned to that brand was enormously powerful. People really identify with it: it has got into people's psyche - it's aspirational."

The company also gained the benefit of being identified as a US company - which applies both overseas and in New Zealand - thanks to the Ironman moniker, even though it calls a small office off Ponsonby Rd home.

At first, Ironman Wetsuits manufactured its product in New Zealand. But by 1986, capacity was stretched and it was clear that production would have to move overseas.

Mr Mundell was thrilled with the outcome.

"The work ethic in Asia is amazing - it does not alter first thing Monday morning through to Friday afternoon. There is total consistency, and we have total quality control. After moving there, our rate of returns dropped overnight."

Production is now based where the materials used - including rubber - are developed.

And with production of wetsuits being "nine-tenths" labour, costs dropped.

Mr Mundell visits the Taiwan, Thailand and China sites each year and says their standards are "higher than New Zealand's."

That is not a comment on New Zealand workers. He says he loves New Zealand - "it is Utopia" - and would live nowhere else.

The company will not move elsewhere, instead corresponding with its 120 distributors in 37 countries by e-mail.

Another bonus New Zealand has for the company is as an "amazing" test market.

The company can launch a product locally - as it has just done with its Hybrid wetsuit range - and gain a global snapshot through direct feedback from the market.

"We can explore certain media for around $10,000, as opposed to around $750,000 in the US to do the same thing."