Bluelab Corp to spend growth grant on taking new product to market

Friday 17th April 2015

Bluelab Corp, which makes electronic metering and control devices to aid plant growth, will use a new research and development growth grant to speed up taking a new sensory product to market in the next year.

Tauranga-based Bluelab decided in 2004 to focus solely on manufacturing measuring equipment which is used in controlled growing spaces such as greenhouses, hydroponics and aquaponics by commercial growers and backyard hobbyists. It exports nearly all it produces to 15 countries, with the major markets being the US, Australia, and the UK.

It was one of 14 companies among the latest growth grants handed out by government-funded Callaghan Innovation which are estimated to be worth up to $15.8 million over three years, based on applicants’ indications of their likely research and development spend. Qualifying companies can claim back 20 percent of R&D expenditure capped at $5 million a year, providing they have spent at least $300,000 and 1.5 percent of revenue a year on R&D in New Zealand.

Bluelab chief executive and majority shareholder Greg Jarvis said he’s unsure at this stage how much he will be claiming back but the company already spends around 5 percent of revenue on R&D. He wouldn’t disclose the annual revenue though says it has doubled in the past five years as export growth ramps up. The goal is to double it again in the next five years.

The grant will help the company commercialise a new product in the next year which Jarvis wants to keep hush-hush at this stage for commercial sensitivity reasons. The sensory product is at the prototype stage after two years of development but Jarvis said taking the next step to bring it to market has kept getting put on the backburner due to more pressing needs.

“What this grant does is allow us to focus on research further out rather than immediate product improvement work. We can look at what technology is starting to emerge and how we can integrate that into our business,” he said.

Jarvis said another aspect the R&D spend will go on is taking existing products such as its hand-held meters and automated dosing and control devices and deploying remote sensing for them from the internet and mobile devices.

All of Bluelab’s products are customer-centric designed after customer feedback on how they use existing devices or what new technology they’d like. Jarvis said the company’s current R&D is focused on providing the customer with better information – so rather than just providing a measurement, it also says what that means so a customer knows what they should do about it.

It was also working on simplifying calibration sequences for existing products because “if you had to tune your tv every time you turned it on, you would get pretty annoyed,” he said.

Bluelab sells through distributors offshore and currently has three US-based staff that provide after sales service. Jarvis said he hoped to appoint another two of three staff offshore in the next six to 12 months, including some in Europe.

The other 49 percent shareholder in Bluelab is Evanescent NZ, which is owned by three Tauranga men who are also directors.

BusinessDesk.co.nz

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