“Micro-multinational” manufacturers can excel

University of Technology Sydney’s Professor Roy Green has said that there’s been a growth in “micro-multinational” manufacturers, and such companies are well-suited to the challenges facing Australian companies.

University of Technology Sydney’s Professor Roy Green has said that there’s been a growth in “micro-multinational” manufacturers, and such companies are well-suited to the challenges facing Australian companies.

Green, interviewed by Smart Company, said some firms would die off, but others with niche offerings and an international focus could adapt.

Green believes, “Those which will survive are going to be characterised either by producing very bulky items that are difficult to import so there is a natural tariff barrier or manufacturers that are agile and specialised and are producing products that can operate successfully in market niches both locally and in global markets and supply chains.

“In particular we are seeing a growth in what are sometimes called micro-multinationals; that is, SMEs but ones that are born global and which have a global mindset and see their strategy as being global and not limited to the Australian marketplace.”

Smart fabric maker Textor, machine tool maker ANCA and electrical accessory brand Clipsal were given as examples by Smart Company of Australian manufacturers that were suited to the times.

Phillip Butler, owner of Textor, said that, “To do nothing in manufacturing is a formula for disaster, so the approach we are taking is to aggressively grow the business by recapitalising the business and going after these global markets.”

Textor exports to parts of Asia and make high tech fabrics for fluid management with a high-skilled workforce.

ANCA, which exports almost all of its CNC tool and cutter grinders and has recently gained a presence in Thailand, spends heavily on research and development and is able to sell into China via its Thai branch.

“There's a free trade agreement between China and Thailand, so we're able to ship goods into China duty free,” said Pat Boland, co-owner of ANCA.

“There's not many free trade agreements between China and the rest of the world, so the one between China and Thailand's been quite significant.”

Clipsal also credited a high-skilled workforce with its success.

“They strive to add value to a product and you sort of live and die by that, you need to constantly innovate and add value and the minute you stop doing that you are going to start dying,” Alex Beltrame from Clipsal told Smart Company.