Outsourcing credited for saving Blundstone

Blundstone CEO Steve Gunn has cited the controversial 2007 decision to offshore as a factor in saving the company

Blundstone made the decision in 2007 to end its 137-year-old Hobart manufacturing operations. Around 300 workers lost their jobs in the move. Most of Blundstone’s boots are now made in India and Thailand.

Gunn told the Sydney Morning Herald at the weekend that the company still had 115 people on its payroll in Australia, and that the 2007 move assisted the company in surviving the pressures of the persistently high Australian dollar.

''We really should be looking at the fact that we've saved 100-plus jobs, rather than the fact that we've lost 300, and I realise that's very hard for people to appreciate if they happen to be one of the 300,'' said Blundstone’s chief.

Other companies such as ResMed and Blackmores have looked to Asia for their manufacturing operations, and last week Ken Henry, a former Treasury secretary and currently researching a white paper on the Asian Century, cited such decisions as playing to Australia’s strengths.

“Instead of making the same products that we were making 140 years ago, that capacity can instead be used to make and do things that only we can do, or that Australia can do better than people in other countries,” said Henry.

“It is clear today that if Blundstone had not shifted elements of its manufacturing to Asia five years ago, it would have gone out of business completely.”

Last week Henry told an Australian Industry Group national forum that Australian businesses would fare better if they behaved like regional entities, and should look to Asia for labour if that was necessary.