Canny survivor of cheap import competition thrives on innovation and niche markets

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Rex Industrial EquipmentBy Romy Udanga

Finding market niches and employing innovative skills to fabricate quality products have transformed Rex Industrial Equipment from a small general engineering business into one of New Zealand’s leading industrial castor and materials’ handling manufacturer.

Rex endured the onslaught of imported industrial goods over the last two decades that has decimated traditional manufacturing bases in New Zealand to emerge with a facility that produces more than 60 percent of the castors, wheels, conveyors and trolleys that it supplies directly to businesses through its network of 10 branches nationwide.

Peter Blackett, managing director at the family-owned company, says the ability to design and create products to suit individual needs balanced by “quality importation” is the future of manufacturing in New Zealand.

“Over the last 15 years that we’d been balancing our import- production business to remain competitive, we found that gearing sales, marketing, design and production systems to address client requirements and delivering products on a short turnaround gives us the edge over imported products.

“Retaining our manufacturing base locally means that we’ve been able to customise and adjust our production quite quickly during times when we’ve got large orders,” Mr Blackett says.

It has also resulted in a zero design and manufacturing failure for the fit-for-purpose materials handling products, like conveyors, airline food locker trailers and picking trolleys, they produce, he says.

“We’re really struggling to name any areas where our products have failed.”

Rex manufactures all of the tubular steel that go into its materials handling products. Tasman Engineering, its wholly-owned subsidiary that has three production facilities in Auckland, produces cast and precision components enabling Rex to control costs.

Over the last two years, it completely redeveloped about 75 percent of its materials handling trolley ranges, modernising their designs and finish to cater to the needs of the “warehouse-office-showroom type” of businesses that had emerged.

At its headquarters in North Shore, Auckland, Rex assembles about 70 different castors for light to heavy duty applications, including those with polyurethane tires – and imports a similar number for “special applications” from an American company that is manufacturing out of China.

It imports Genie hydraulic lifting equipment and Bushman hand trucks from the USA, and lifting tables from Japan to boost its materials handling line, which includes hoists, lifters and stackers.

Rex traces a 70-year history from its original formation in 1942 as Rex Manufacturing. It became a family-owned company in 1988 after Peter’s father Bruce, now 80 but still active as a director of the company, purchased the wheels and castors and conveyors systems business units to spin off Rex Wheels and Castors Ltd, and renamed it to Rex Industrial Equipment in 2006.

Mr Blackett says his family’s business philosophy over the last 30 years “has always been about people in the business and their customers.

“It has not been about being the cheapest but providing the balance of good service, good quality and reasonable price. Without that as combination we would not have been able to reinvest in the process of providing good products.”

He says the philosophy extends to company staff who are treated “like family”.

“We look out for each other and we are very loyal to our staff and our staff are very loyal to us. About 50 percent of our 30 or so staff have been with us for more than 15 years, some more than 20. And we have very low staff turnover,” Mr Blackett says.

Marketing manager Stewart Atkinson, who’s been with Rex for more than 10 years, says the philosophy extends to the marketing model of the company which is “largely business-to-business”.

“We go to end users rather than run our business through distributors. We have thousands of business customers rather than one or two large distributors. This has resulted in us covering about 50 percent of the market we are in,” Mr Atkinson says.

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