Elders close to wool contracts

24-08-2009 | Alan Williams

Elders New Zealand will be finalising details of its Just Shorn wool contracts with suppliers over the next two weeks, says managing director Stuart Chapman.

This is more than a month behind the original schedule, but commercial trials of wool samples had taken longer than expected. The trials, conducted at Godfrey Hirst carpet plants in Australia and New Zealand, had gone extremely well, Chapman said, meeting robust standards required by the United States building code.

Just Shorn brand is being developed with the US marketing company CCA Global and five carpet manufacturers, with carpets being targeted at high end luxury users such as medical centre and legal offices.

The first contracts with suppliers would be for smaller samples, with larger contracts to follow, based on similar product specifications. The number of suppliers had not been settled yet.

Chapman said the first samples should be available early in the New Year, and orders from retailers were expected to follow soon afterwards.

He said the US carpet market was hurting in the economic recession, but those high end users still had discretionary dollars available and typically replaced carpets regularly for style reasons rather than when they wore out.

Chapman would not comment directly on reports that rival group Wool Partners International (WPI) had made a competitive three-year offer to CCA Global.

"There has been some antagonism, and it's best left there. We are moving forward and CCA has been very supportive of us.''

Elders NZ - half owned by Elders Australia and half by NZ businessmen Chapman and Eric Spencer - has also completed a review of its operations, based on the impact of the weaker international market.

After a new regional-based management system was put in place on August 1, it has settled on changes to its real estate and farm supply businesses. Chapman said the number of full-time equivalent staff redundancies had been expected to total about 20, but this had been reduced to 15 affecting those divisions, and also some administration staff.

Elders would have a NZ staff of about 400 people after those changes.

  Printable View