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Textor, a success story for Australian manufacturing

Phil Butler's Textor Technologies has not only doubled in size but has opened up a multi-national textile value-chain, says Peter Roberts in this article in the Australian Manufacturing Forum.

 

POSTCARD FROM THE JOURNEY TO HIGH VALUE-ADDED MANUFACTURING

Reproduced with permission from the Australian Manufacturing Forum

Author: , Founder at Australian Manufacturing Forum

Australia’s textiles, clothing and footwear (TCF) sector has been in decline for so long that it is surprising that any has lasted let alone managed to move up the global value chain.

But it is by developing and making higher value textiles that Phil Butler’s Textor Technologies have not only doubled in size but have opened up a multi-national textile value-chain.

Phil together with a son and daughter are putting the finishing touches to a $17 million investment in their Tullamarine factory to double capacity to make non-woven moisture-transfer fabric used in baby nappies and personal sanitation products. Now producing a gob-smacking 100 million square metres plus of fabric annually, the Butlers operate without a single additional production employee.

“We can do it,” says Butler. “Labour costs are high. So what do you do you just run the machines faster, you automate.”

The same 29 production staff still run Textor’s plant across three daily shifts. But the factory has morphed out of all recognition as Butler raced to spend cash on new equipment made cheaper by Australia’s historically high dollar.

The plant has been extended physically and all the machinery replaced with oft-seen carding and other machines linked together in a seamless process. Bales of snowy-white textile are loaded directly into shipping containers – no stock is on hand and work in progress is a few hours production.

The keys to moving up the value chain involve increasing the uniqueness and complexity of product and process and accessing increasingly high level skills through partnerships from R&D to marketing.

One element is machine monitoring allowing visibility into every production step via workplace consoles or via the internet. Every square centimetre of fabric is inspected by machine vision systems. Textor’s intellectual property (IP) lies in linking supplier equipment and skills together in a unique way.

Coupled with high-level suppliers, another strength is Textor’s demanding customer, Kimberly-Clark. As well as forming the basis of the billion nappies K-C makes annually in Sydney, 70 per cent of Textor product is exported to K-C plants in the region.

A single customer is often seen as a weakness, but this is a genuine, win-win partnership between the companies. Textor’s doubling of output has come on the back of it developing a new three-dimensional textile that gives superior absorbency than flat fabric. Marketed under the ‘Huggies 3D UltraAbsorb’ name, K-C’s nappies are the market leader.

Textor’s product technology journey began with the federal government’s researchers in business program which introduced the company to CSIRO and to the value of investing in science. The organisation is now a key partner and Textor employs its own textile scientists. K-C has also had technical input with several of the multi-national’s engineers on-site during a recent visit.

“We have solved the production issues and we have solved the science issues,” says Butler. “We see no reason now why we can’t go global and not only ship offshore but make offshore.”

Undoubtedly management skill and risk-taking is central to Textor’s creation of an Australian manufacturing company that is a price-taker. More recently the trend in Australia has been towards lower-value, less differentiated commodities where we are likely to be price-takers.

It is a long time since an Australian TCF producer graduated from local to global manufacturer, but if anyone can do it Butler can. He has put everything on the line, he admits at a time when others are looking to relax or travel.

“This is my $17 million yacht,” says Butler standing in the middle of his production floor. “Though sometimes… it is a scary yacht.”

May 21, 2014