Niche exporter Tasman's sticky products cover the globe's books

Friday 20th July 2001

STICKY BUSINESS: Colin Gallagher

By Graeme Kennedy

Super-niche exporter Tasman Industries plans to double its US and Europe trade in the next 12 months with an inexpensive everyday product that has grown to become a $7.7 million business.

The Manukau company manufactures adhesive film for book coverings and has carved out almost 30 overseas markets to supply schools, libraries and homes with the brightly coloured and designed protective plastic, branded Duraseal.

And unlike most manufacturers, Tasman went straight into exporting before building a domestic base for the product - a success story that won the company the exporting prize in the recent Westpac Manukau Business Excellence Awards.

Managing director Colin Gallagher ran his own Auckland adhesive contact paper business in the 1980s before selling it to ACI Australia and starting Tasman in 1984.

"Sticky stuff is in my blood," Mr Gallagher said. "I had the background and knew book coverings were not being done well around the world. Most were PVC and that's not a nice plastic, not environmentally friendly at all.

"I got together with a partner to produce coverings with an inert, friendly film - polypropylene - and figured that if we introduced them with that rather than PVC there could be a big market for a better product in libraries and for school and text books around the world.

"We couldn't afford to buy machinery so we designed and built it ourselves, the first unit in 1984 and the second in 1990 and they are both still going strong."

Mr Gallagher imports backing paper while the plastic film is made in Auckland and printing done in Asia to keep costs down. The company has licences to produce the covering film featuring a variety of the most popular movie and cartoon characters as well as in-vogue designs, colours and patterns.

"We began in export rather than the relatively small local market because the equipment we designed had to have volume to make it work," he said.

"We were confident we had a winner so we took a punt, put all our eggs in one basket and went 100% into export. I jumped on a plane to Brisbane, met an importer in the car park and sold our first coverings right there."

Mr Gallagher set up a distribution network in Australia as the most obvious start-up market, formed a company with a similar business in Europe and got into the UK through trade shows and a school and library distribution operation.

A regular exhibitor at the world's biggest industry trade fair, Paper World in Frankfurt, he picked up other agents from around the world, including Argentina and Africa, but remains out of Asia for fear of piracy.

"We would probably survive if Duraseal was pirated now but maybe we wouldn't have in the early days - we've just kept our non-Asia policy to concentrate on the northern hemisphere and other markets," he said.

"It took us 12 years to get into the US due to New Zealand's credibility as a manufacturing country - they thought of us as an agricultural economy with no name for manufacture and I found I had to sell New Zealand first, then my company, me, the product and finally a competitive price.

"I had to convince them we had a company that could produce a product they should have."

Duraseal moved into domestic stores soon after the export trade was established and now has more than a 90% market share with 60% in Australia. About $6.2 million of Tasman's $7.7 million sales are in exports.

Expansion to double the $1 million sales in the US would come from widening the product range while a new $750,000 winder at the Auckland plant would enable Tasman to produce a more competitive product for the European market, which has sales of around $700,000.

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