Reprinted with kind permission from HIA and HIA’s Housing magazine, Issue May 2006
A GERMAN COMPANY RENOWNED WORLDWIDE FOR ITS FURNITURE FITTINGS CONTINUES ITS SUCCESS IN AUSTRALIA LOUISE TIGCHELAAR REPORTS.
Hettich Australia & New Zealand is a rare company indeed in that, unlike most, it does better in tough times.
That, combined with an extensive cost-cutting exercise, and ensuring its thousands of furniture fittings do not overload the market, is a key to the 76-year-old German company’s success in Australia and New Zealand.
With a worldwide workforce of 5000 and more than 120 in Australia and New Zealand, Hettich is regarded as the world’s largest producer of fittings for the furniture industry, the retail trade, cabinetmakers and the DIY segment.
Helping achieve the company’s success is Aidan Jury, managing director sales and marketing of Hettich Australia & New Zealand. Aidan is based in Hettich’s Sydney office, established in 1989 and a fully-owned subsidiary of Hettich International.
Aidan’s passion is “making things happen” (see box below). “I’m not the sort of person that you could chain to a desk,” he says. “You might as well cut my legs off!” Now almost in his seventh year with Hettich – first in New Zealand for four years and so far in Sydney for three – Aidan certainly makes good use of his legs and is rarely at that desk.
With just over 14 years in the building industry after obtaining a business degree from New Zealand’s Waikato University, since graduating he’s spent all his professional life in sales or marketing-type roles.
He describes Hettich’s cost-cutting exercise – one of the things he’s helped make happen – as probably his biggest challenge so far in the company. A major task, it was achieved by consolidating warehousing and distribution in both Australia and New Zealand.
“In New Zealand we closed three warehouses down into one distribution centre, and in Australia we closed down four warehouses into one new one.”
Probably one of the biggest challenges, he says, is making customers understand that they are still going to get an equal if not improved level of service. Hettich’s group of distributors helped to achieve this.
“We’re proud to have developed a quality group of distributors who represent our product to many thousands of customers. Our distributors are an extension of our own sales team and we treat them accordingly.”
The cost-cutting has not harmed operations. On the contrary, with all the talk of the industry downturn, Aidan says that outside of NSW there’s no sign of it. “We’ve got booming markets in WA, Queensland, and energetic markets in Victoria.” And even within NSW and Sydney, he expected to be hit a lot harder because of the downturn in first or medium-type new homes. However, there’s been hardly a hiccup.
The reason, he believes, is that when markets tighten up, people are more savvy with their money and tend to want to spend once for a longer user life.
“In doing so, they tend to put more accessories and more innovative-type solutions into their designs, so our experience has been that in tough times, the company prospers.” A new home market slowdown generally means a major spike in the renovation market, an area in which Hettich does very well.
Keeping Hettich’s many line items ‘undiluted’ is another challenge. Of the more than 12,000 products available in Australia, Hettich currently sells 6100. For Aidan managing the quantity of line items is a delicate balance between ensuring an innovative portfolio of products and having so many that the focus is diluted and the market overloaded.
“We try to get rid of old line items, but sometimes it’s difficult because there’s always someone who’s dependent on it … it’s very easy to launch new products but it’s very hard to kill the old ones.”
And such a large portfolio is an important part of Hettich’s ability to provide solutions for all levels of the market. There are four main buying levels for Hettich products: retail (consumers); cabinetmakers and joiners; architectural and design; and manufacturers (trade) – the largest buyer.
Ultimately, says Aidan, Hettich will continue to invest in innovative new product solutions, the range will continue to diversify, and there will be a considerable push outside the core traditional markets such as kitchens and bathrooms.
And with 450 staff in Germany dedicated to research and development – there are plenty more new and exciting innovations on the horizon.
“We’ve condensed our range in the past three years to a core range of products to be the best in our field. There’s the danger of doing lots of things in a mediocre fashion rather than doing a few things exceptionally well.
“We just continue to go from one high to the next, and we’ve done that through various innovations.
“Our challenge is to keep helping people design better products and staying ahead of the competition.”
MAKING THINGS HAPPEN
Aidan Jury is the brains behind one of the biggest kitchen and bathroom events to hit Australia for some time – world-renowned kitchen designer Johnny Grey’s 2006 Australian tour).
Coming on the back of a successful 2004 tour by European-renowned German architect, Michael Schumaker, Aidan hopes the tour – sponsored by Hettich and development partner Fisher & Paykel and HIA – will inspire Australian kitchen designers with fresh ideas.
THINKING INTELLIGENT KITCHENS
Intelligent Kitchens is designed to help people to think beyond the core product or hardware they would normally include when designing a kitchen or bathroom.
By segmenting the kitchen into relevant areas – food storage, food preparation, cleaning and so on – the Intelligent Kitchens booklet shows how people need to include the everyday things which are often taken for granted and can be easily overlooked.
For instance, says Aidan Jury, only 30 per cent of new kitchens in Australia include a waste bin in their design. The majority of kitchens also have no tea-towel racks, no provision for spice racks, no lighting, and no provision for recycling – the latest ‘big thing’.