New direction for building pioneer
It all started with the quintessential McRaeway A frame chalet.
Business reporter Emma Bailey talks to McRaeway Homes managing director Chris Randall about the company that 50 years ago kicked off New Zealand's kitset market.
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How was the company formed?
The company was formed in 1962, by Ian McRae who developed the production-line pre-cut framing and kitset housing systems.
In the latter part of that decade Ian undertook a lot of residential home construction in Timaru, including several streets and small subdivisions. Winning a tender for around 200 garages for the new hydro town of Twizel accelerated the early development of a production-line system.
Following an encounter as a supplier to a company producing A-Frame houses, the McRaeway A-Frame chalet was born. A product was created in a form of delivery and construction which had not previously been available in any structured form.
The trading name of McRaeway Homes has been used since that time, as houses were sold and distributed throughout the country. Distance has never been a barrier, with deliveries from Auckland to Bluff, and the first export of a house to Japan in 1973. Other exports were to follow from the mid-1990s, with several houses in Japan, the Pacific Islands and Hawaii.
Ian passed away suddenly in 1992.
Twenty-five show homes have been built from Auckland to Invercargill since the first A-Frame display home was opened in Park Lane, Timaru, in 1974.
Over 6500 families are living in McRaeway homes and a current portfolio of more than 50 standard house designs, McRaeway dispatches houses to destinations throughout the country.
When did McRaeway Homes change ownership?
We took over in February last year. I am one of the new owners and the shareholders are from Nelson, West Coast, North Canterbury, Christchurch and the Mackenzie Country. I worked in the timber industry and we supplied products to McRaeway. We bought the brand really, 50 years of history, and we stand behind that brand. The big challenge will be to move it forward.
What have you changed?
We have changed the focus and rejuvenated the plans and focused on supplying a middle range. McRaeway grew up with its customers really, it started with an affordable family home then a batch and then a higher end home. The business was struggling and we have brought back a lot of things in-house, had a capital injection from the shareholders and focused on moving toward creating a one-stop shop, where we can build the house from start to finish.
We have taken back control of the design side which gives us more control over the brand and moved towards local suppliers, we are very much locally based.
At one time there were around 50 staff, now we have a dozen. It is a lean and mean operation. We need to rebuild and plan to turn it around in a couple of years. I think we are on track.
What are the challenges in the industry?
The recession has changed the industry. The `my house is bigger' idea has died since the recession and people want more sensible homes that they can heat and the sections they build on are smaller. Four or five years ago people's expectations were quite extreme but people are much more realistic now.
The whole industry is struggling and competition is strong throughout the country.
Will you remain Timaru based?
Timaru will definitely remain the base, a lot of business has predominantly been south of here but we want to grow business north of here. We build all throughout the South Island, from Southland to Nelson, we are involved in a lot of dairy conversions too and are predominantly regional-rural.
Will the Christchurch rebuild provide a lot of work for the company?
Our focus is not on Christchurch at the moment, there will be opportunity there for us in the future but we won't be looking at that until at least the end of the year.
Best business tip?
You just have to be focused, that is what it is all about and involve your team with you and go forward together.
How do you unwind?
I have a lifestyle block in North Canterbury that I spend the weekends at relaxing.
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