Unlike many businesses, Auckland-based Omni Products has been fortunate not to have felt the full force of the recession, and has recently taken steps to prepare for the return of better days.
Recessionary times have an interesting effect on consumers, bringing out a behaviour known as ‘nesting’. Rather than going out to dine, play and shop, we tend to focus on improving our home environment to make ourselves feel more comfortable and secure. Along with reading, knitting and cooking, gardening and small DIY jobs feature strongly. And that has a boon for a company like Omni Products.
Gardening went out of fashion 10 or 15 years ago, says co- director Neville Dodds. “But it’s coming back into vogue now. Growing your own vegetables has become very popular, and that’s been good for business.”
A decade ago, Neville and Anne Dodds took over the 20-year-old business whose focus has been as a glove wholesaler, selling everything from gardening, trade and household gloves to thermal and disposable medical gloves, along with a few safety products.
Omni Products supplies its products to garden centres around the country and has about five house brands.“Our predominant market is DIY, and that has improved quite a bit over the past year. However, we’re also making quiet headway with industrial distributors. The industrial market has lost a lot of its gloss because industry itself has been finding things very hard.”
In 2009, at a time when others were hanging on and hoping to weather the economic storm, Omni Products made some radical moves after deciding to review its business plan and update it for the changing market.
“Our Hayes Knight director had been trying to convince us to expand our product offering for quite some time,” says Dodds. “We finally did it because of the recession. Others were pulling back, but we felt we needed to forge forward. He is a hard taskmaster, but that’s been good for us.”
As a result, Omni Products decided to expand its operations by appointing a sales executive and branching out into a new range of gardening tools and accessories. Dodds and sales executive Gail Smith travelled to one of the world’s largest trade fairs in China to source new product lines for the expansion.
Omni Products imports the bulk of its range from China, Malaysia and Slovenia, and in the last three years, has also looked to India and Pakistan for quality leather gloves.
“It’s all worked brilliantly. We knew what we wanted to buy, and then presented our budgets to the bank to get their support, before showing sample stock to our customers. We’re all really proud of these new products and our clients have been very happy with our new range.”
Dodds believes the key to success has been knowing their market and being prepared to take a risk when everyone else was hunkering down.
“We always had a tight overhead anyway, and we didn’t have much fat to start with, so trimming that back has been next to impossible. But we’ve made some small changes where we could,” he says.
“Our costs have gone up a little, mainly because of the dollar. When it dropped to 50c, that had major repercussions for us, like all importers. We were struggling to absorb as much of it as we could, rather than putting our prices up in a flat market. Our goal is to keep our market share. The rise in the dollar has been a real benefit.”
Conducting business honestly and respecting their customers is a fundamental for Omni Products’ directors.
“You can’t change your position at the last minute in a recession and expect people to come to you. In the good times you need to be good to your customers. We’re very fortunate that we can go to our customers and write our own orders. We treat them the way we’d like to be treated – we want ongoing monthly orders so we pride ourselves on our ethics and working with our customers.”
Confident about the future and the new direction Omni Products is taking, having done their homework, Neville and Anne Dodds aren’t concerned about the extra financial outlay.
“We’re taking on extra storage for all the additional stock, and these new products have given us even more confidence,” says Dodds.
“The extra outlay is all in the budget. And having Hayes Knight do our monthly accounts ensures we know exactly where we stand financially, which eliminates any nasty surprises.”
This story originally appeared in Beyond the Numbers, issue two.