Project Description
In 2000, Textor Technologies (then known as Lantor of Australia) was a struggling Melbourne textile manufacturer set to be wound up by its English multinational parent.
That might have been the end of the story, if then-director, and now chairman, Phillip Butler had not staged a management buyout.
At the time, the business was involved in producing small volumes of textiles for a range of local companies in the automotive, hygiene and medical industries.
But believing there was room to transform the business, Butler, and staff and family members who followed later (including son Andy Butler, now managing director) set about turning it into a high-tech, global operation that now supplies its high-tech fabrics to the global baby nappies industry.
Andy Butler says that for the first few years after 2000, Textor was in a loss-making position.
Seeing the decline of the automotive industry approaching, Textor was steering itself out of the sector to focus more on developing textiles for the hygiene industry. The first major investment was in 2002 when the company began supplying Kimberly-Clark Australia with fluid transfer fabrics. The success of that project led to requests from other Kimberly-Clark Asian businesses to supply into the region.
Andy says that over several years the business grew and learnt to handle the demands of export trade.
Following the mining boom, the Australian dollar was climbing to historic highs and this threatened the company’s future as the exports became marginally profitable. So the company decided to use the opportunity of a high dollar to invest heavily in the latest machinery. It also became involved in a business research scholarship program, which enabled Textor to employ a CSIRO scientist to help develop state-of-the-art fabrics.
Andy says at that point Textor started to catapult itself out of the local market and think about the possibilities of the global market.
Textor figured that increasing its scale by chasing large volume contracts was the way forward. To be successful globally, the company had to differentiate itself by bringing new innovation to the market and also had to develop a low cost business model.
In the years since, Textor has changed its strategy from supplying a large number of companies, to supplying only a handful – including major client Kimberly-Clark, which uses Textor’s fabrics.
Textor’s contracts are no longer measured in rolls of fabric – but by the containerload.
Margins may be low, but Textor has managed to increase its output enormously through innovation. Revenue has increased significantly in the past two years alone, but staff numbers have remained the same. “‘The business objective is to continue that growth,” says Andy.
Back in 2000, Textor had virtually no exports; now 60 to 70 per cent of the company’s output heads offshore.
Andy says a loyal, flexible workforce – incentivised through profit-share arrangements – has been instrumental in helping Textor succeed.
While labour costs are only a small part of the equation for Textor, some challenges remain, such as raising capital for the next stage of investment, and managing rapid growth.
Textor continues to strive for the most innovative textiles possible, continuing to have CSIRO researchers on site.
Andy says Textor continues to see the value of tapping into science, describing the CSIRO as “a massive intellectual database. It’s an enormous resource for Australian manufacturing.”
