Weaving Purpose And Legacy Into The Fabric Of M.J. Bale | Matt Jensen

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Do you think that we're currently walking into a recession? I think we're in a recession. I definitely think we need to be preparing for challenging times because Matt Jensen is the founder and CEO of MJ Bale, one of Australia's premier men's wear brands. With over 80 stores nationwide and an annual revenue exceeding $100 million, MJ Bale is a pioneer in modern Australian tailoring. 97 98% of our fiber selection is natural. Wool, silk, cotton, linen is is what we do. Matt has led the brand with

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a deep commitment to integrity, innovation, and sustainability, making MJ Bale the nation's first carbon neutral fashion brand. I think bringing it back to the community and sharing that story with our consumer is is something that we hold dearly. I would like to be remembered for somebody who really put Australian wool and natural fibers onto the globe stage. And do you think that the fashion scene is losing its soul in some ways or is it going through a renaissance in others? [Music] This episode is brought to you by Wick

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Studio. Matt Jensen, welcome to the Agency podcast. Thanks, D. Great to be here. You've definitely built a brand with what I would term as a legacy. What I mean by that is it it has a greater meaning than just the product that you can buy in store. And if you to zoom out and take in everything mentally and emotionally, what's been your perspective on what it takes to be an entrepreneur? Wow, there's so many things there. Um, nice broad question to kick off. I like that. Uh, gosh, you you need to be really

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really driven. And I I think and we'll get to this a bit later as well, but I I think you know doing it in Australia where there's high expectation and you know an expensive environment. We live on the world's biggest island and it's a one it's paradise right where we live. We live in the best place in the world and but it comes at a cost and you know things are expensive out there. So, as an entrepreneur and then to make it over the long run, you you really need to get there's lots of P's, right? So,

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I'll run through a few P's for you. First of your positioning. You you've got to have sound positioning because if you don't have that right, you then just try to get yourself back to a better positioning. And and it's big and strategic work you need to do in the beginning to try and understand where you're at from a product point of view. uh how you're going to actually position yourself with your product into that market on price on on location on um on brand positioning. You know, you

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guys do this day in day out and and live and breathe it. So, I hope I'm not telling you. No, go ahead. Today, today's all about your your take on this. Yeah. So you and you probably see this with your with your clients as well, but getting that positioning right and and then having a really clear vision of what what you want to do with your business is is obviously super important. But then you've got to nail the product. You've got to nail the product. And with the one of the big

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challenges now, there's too much product in the world. There's just too much there's way there's way too much production capacity and the the the the manufacturing capacity and the engineering behind whether it's food crops or whether it's um how to get more yield out of cotton fields or maybe it's you know some other form of production but that all just cranks up the amount of product we've got in the world and people want more and more and more and uh I think when you've got

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that much product in the world and you've also got the connectivity the digital connectivity of the world where in in our space in you know consumer products and specifically men's wear and men's clothing and accessories you you know you can shop from any brand anywhere around the world. So unless you have something to offer in terms of product and our take is is pretty simple. Um, but it's got to be high quality. It's got to have a some character and cool to it. And and it also needs to be um of natural fibers. I

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mean, we are fundamentally a natural fibers company making garments of integrity for men of character and so to to hopefully give them joy and confidence that they can go out and venture out in the world and and explore it. And if we can do that part of the equation, giving our customers joy and confidence, that that's actually what fills me with with great pride as a as an entrepreneur. But you you've just got to get that product right, especially now because there's too much choice. Nike sneakers

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or brown suede shoes or, you know, t-shirts or caps or jackets or whatever it is. You or coffee, you you got to be bloody good. So very hard to get off, you know, beyond the first months or years unless you've got a good differentiated product. And if you want to sell it to and then you got to think about your place, where am I going to sell it through? Is it going to be digital? Is it going to be uh B2B TOC through a department store? Or am I going to set up my own shops? or am I, you know,

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going to uh do it by appointment or whatever that is. You've got to be really succinct in how you do that and then understand the commercial metrics of of um making you funding that, right? Cuz that's expensive these days going setting up a shop or building it or whatever or you sell it to a department store, then the department store needs to make their margin. So they're going harder on you and you get a skinnier margin and then you got to sustain all that you know into season after season.

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So being very clear on your channel to market is super important. Then people I mean people could have come straight after positioning uh and product but you got to have a gun team and maybe the gun team's you in the beginning. I mean you ran this business on your own right for a while at the very beginning. And um yeah, it was a it was a couple months in where I had two people volunteer their time cuz I'd shared my vision and they were like, I want to be a part of that. Um so we kind of had a very early

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onset of people, but I would agree with that. People's at least 50% of the equation. Yeah. At least at le game it it's at least 50% of the equation. And I've seen stores, right, some of our stores have traded at a level and then for whatever reason the the team changes and I've seen a 50 to 70% uplift in the performance of that store. Dramatic, right? Like same volume of staff but a totally different outcome. Just different people, better operators. So getting the team is is is critical.

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And of course you need team culture and dynamic and you know everyone we've got the barbecue test, right? So, you want people to pass the barbecue test and they come on in and you're happy to have a barbecue with them and they're good people to work with. Um, I think that's super important as well. The next P pricing. You got to you got to be really clever with your price whatever it is. I mean price subset of that value which can be anywhere along the value curve. It can be cheap and pro presents good value but

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equally it can be super expensive. I don't know Louis Vuitton Hermes really good value because people honor that and want that for a long period of time and therefore it's good value because it has scarcity and you know people people really love that. Last one's promotion, right? And I think it kind of links back to the the um positioning piece, but again, we're saturated. You know, there's so much product in the world promoted in a bunch of different ways and all the algorithms are feeding in,

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you know, this sort of sea of sameness through the middle. Everything's coming to a singularity. There's this fascinating concept of economic singularity which the AI is kind of pushing us all into. You know, I have frustration with my Spotify music choice. You know, I pick something else and it still plays the stuff that I've got on my good tracks listing and I'm I don't need that. I want I've got that on my good tracks listing. Oh, I want something fresh. But the algos push you

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back to this singularity and they it's all meeting in the middle. So there's there's a few different things there, but when it comes to promotion, you you need I mean unique ad ideas. How many have we seen lately? Tremendous uptake in new thought patterns and new ways of creating things. For sure. Yeah. So you think we've seen many seen good ones lately or not? I I I reckon there's been a maybe I need to pay more attention, but I I feel like there's an early renaissance. It's

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very early and they're in pockets. But I would agree with you like I've poured over the one of my favorite things is like Porsche ads in the 70s and 80s or you know if you go back through the books and we've got a library here of old like advertising books and the stuff they were doing in the 60s7s and ' 80s was exceptional. Um but I would agree with you everything kind of it was pretty analog format as well right? Yeah. And everything kind of has converged into meta ads, SEO, Google

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ranking. Everything's quite uh structured and kind of, you know, mild with the creative. But I think it's kind of I feel like there's a at least a burst of renaissance around rebelling against that system. We put we put a bunch of our media by a lot of it more than half probably more like 70% our media is going to digital. Okay, which is a lot, right? Probably too much anyway. We'll talk about that later. We'll talk about that later. But um anyway, trying to get the that marketing right, have an edge,

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right? Have something to say and we've we've done some beautiful campaigns over the years. We we won a gold lion at Can. Oh, really? Yeah. Yeah. Which was really cool. Grazed on greatness. I can't remember when it was. U must have been 2011 12 13. Anyway, grows on greatness where we um we we took grass from the SCG. Well, we're kidding out the Australian cricket team. And so we took grass from the SCG. We replanted it on a farm up in New England, New South Wales. Bill Mitchell, the wool grower, grazed his sheep over

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that grass from of the SCG. We then shaw the sheep, took that fleece, spun it, wo it into fabric that we then turned into the uniform for the Australian cricket team to play test matches back on the SCG. That's exceptional. So, it was this cool circular idea and um credit to to Brad as Paul Bradbury, my my great old mate at TBWA and his team who did that with us. And they won Yeah. They want a gold line at Can. That's a remarkable idea. It was cool. And apparently Nike um were were at can going we want a little bit

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more of that. Yeah, I can imagine. We want a bit more of that. That would be like and yeah, so that was cool. That was really cool. But yeah, anyway, I think maybe you're right. I think it could easily be time for um Brad has always says it to me as well. He's like, "No, it's time to do another something really cool." But it's all meeting in the middle. So, there's a lot there. But gee, you you and then personally, you got to have discipline to to go and and an amazing support network. You know, my

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wife and family have been incredibly supportive uh over the years. You know, I've built businesses, blown them up, built businesses again. Thankfully, this one's going really well. So, you know, my wife's a legend, Louise. She's she's insane. And she's I'm just super fortunate to have her as a as a you know, partner in my life. And yeah. Yeah. I mean, we were talking about this before. Um, so you you got to have that personal stuff. I mean, out front you've got the work things, but if if things

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are not well organized on the family side, what are we doing this for? You know, it's a good point because I think, you know, we've probably both met people on both sides of the equation. I'm blessed to have Ellie and she's had my back no matter what. Whether it's a 10-hour day or a 19our day, she's like, "What do you need? Cool. I'm here for you. Everything's okay. I got you. If I go home in a bad mood, she'll tell me to go back to work. So, she's she's a bad a

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real salt of the earth country girl. That's good. Um, so I'm very blessed and um but I think some of the things you were touching on there around the different P's. I I think you're you're absolutely correct and I would agree with this convergence of this economy kind of pushing itself into one kind of linear way of thinking. M um do you believe it's going to actually converge or do you think that humans will find a way to kind of bring creative flare back into the market when it comes to how

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advertising they will I mean there's always that pendulum swinging from one side to the other right and I I think that you know zigg when they zag or zag when they zig whatever it is I think that's important but when things are so tightly calibrated as they are now which fundamentally comes down to tightness of capital and liquidity and the ability for people to take risks that just gets harder or just fewer people are prepared to take risks and it's it's sad. I I don't I don't see

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the I mean there's a few coming through. However, I also see a lot going by the wayside and they can't sustain it from a a capital or process or operations point of view. And you know, some some incredibly talented and and great people have have not followed through with their business ambitions recently in in our in our um consumer goods space. And it's sad because they were world class, absolutely world class in in what they're doing. and you just think, well, you know, given another time or a set of

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circumstances or um coni business conditions that getting the timing right and being able to sustain it over a longer period of time um that you know it's just a shame. So I I I'm concerned about that. You know, again, world's biggest island, incredible place to live, but we we're losing this that spirit of entrepreneurialism because it's tough on people. And I think this fundamentally comes, sorry, I don't want this to sound all too negative, but this fundamentally comes from going around the hole, man.

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People need to hear it. I just think it fundamentally comes from the the price of property and then how wages link back to price of property and the ability to play ball in that environment because it's so overwhelming. They're your biggest costs, right? Rent in our space and and wages, they're the they're the largest cost. So if then because that trickles down through everything, the price of your logistics company, it trickles down into the the price of hiring and retaining talent, uh of doing

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things in a opening a store, getting a builder to come and build that store for you. Uh they're all really expensive. So, it's people are not scaling these businesses and maybe they they get a a bit of success and they get to one or two or three million bucks and then they've got a cash flow the next season or or the next store or whatever else and it's like the sticker shock in terms of oh, so I need another whatever quarter million bucks or whatever it is to to roll that store or to buy that new

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range to sell it into wherever and the margins are tight. So, I look at the um whole margin stack of this and it's it unless you are working on really good first margins, it's very hard to sustain a consumer goods business and grow it or you're d-risking it and you're just reselling someone else's thing at a lower margin, but you're not taking that risk on. Business owners, if you're stuck using one platform for every project, you're probably stuck in a growth bottleneck.

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than ever. I would say that it's very different to five years ago, 10 years ago, hell, even two years ago, things were a little different. Do you think that we're currently walking into a recession? I think we're in a recession. Absolutely. In a rec consumer recession, and you know, Alan Cole, great great economist um and business commentary guy on the ABC News, he he calls it all the time. He he says, you know, a per capita GDP is going backwards if you think and you know net immigration of 700,000 or whatever it

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was last year. That's the thing propping up those GDP numbers. The other thing is you know government spending circa 30% it's just shy 30% 27 or 28% of GDP and we all know the government's just throwing money out there. What do you mean by that? just to really explain that what's happening with that. So if you got a GDP number of call it uh 3% basically 1% of the three just shy of it is coming from government spending and then the rest of it is coming from inbound migration which

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grows the you know grows the activity but if you look at the actual uh existing call it like for like either people who were living here one year two years ago that that group of people and of course some people are some segments of the community doing better better others are doing not as well but on aggregate that's going backwards in terms of that GDP number so I I definitely think we're in a recession I see it in stores I mean we're we're we're doing well to hold on to our

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numbers and we're just flat right and we're working so hard and we talk about execution and teamwork and all and you know doing the doing the extras and and we've got an established business and we've got a fantastic client client base and great store network and superb people in the business and we're super fortunate for that and we're only just standing still yet rent is going higher and wages are compounding higher and other things are compounding higher so it's really hard the the equation is so

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finely balanced I sort of say it's price to perfection do you think it's getting harder for business owners to actually manage operate and build companies depends on your space I think you can be capital light and clever and nimble and maybe you can do that you know and I think the digital economy is probably different but those heavy capex things where you're actually constructing or building things or putting in big networks to to then you know generate a revenue that's hard and

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you need a big balance sheet to do it. So I think the for entrepreneurs they're having and and let's say smallcale entrepreneurs. Yeah. And I've been there, you've been there. Uh they really need to be on their toes and super nimble and clever to to grow and sustain even a you know small to mediumsiz business which I don't know is what five plus million bucks or something. That's hard to get it out of the ground. you know this it's hard to get out of the ground but then there's

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all and this you know this is another thing that my great friend Mark Johnson Sherlock has taught me is that you know you've got these brick walls as you go through and you hit brick walls and unless you can actually navigate that which could be around systems and processes could be around capital could be around um you know getting that new leg up of scale to fund the team and everything that you want to add or need to add um You can you can blow up a business. I mean, I hit a brick wall at 20 million

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bucks in my first business and the GSC hit and we were two founders without a shareholder agreement and we've done really well to this stage. It was great and then it was then it was a disaster and we had to put the company in administration. We sold it to a European company and and I moved on and started MJ Bale after that. But um you can do a $20 million business and hit a brick wall and it's gone quite quickly because the leverage within the you know the the cash flows are just bigger positive

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and negative and then you hit a demand shock like that GFC um and you don't have the capitalization or balance sheet to sustain your way through that kind of shock then you blow up your business. Two things there. Can you just briefly explain what exactly the GFC was and what that meant for businesses? And you're mentioning the balance sheet. What do you mean by that as well? Yeah, sure. Um GFC, so global financial crisis and um that was all related to just excessive leverage in fundamentally the

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the US uh housing system 2008, right? and bad mortgage books that were written wi with underlying assets that were great movie on it. The big short cracking movie, beautiful movie, great movie. Um and you the assets weren't worth the paper they were written on uh the houses that then you know they were sold and sold and sold and sold and resold and bundled up and it was just a liquid then it was just a liquidity crunch and but what that meant you know the Aussie dollar went to 50 cents to the US so our

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imports were crazy expensive and consumers were really scared it was like it was demand kind of like co even though it was out there in the US, it then it came through the whole financial system and what everybody was worried the global financial system. What everybody was worried about is this domino effect of who who owned these bits of paper that these rubbish, you know, underlying securities uh of the paper, who who owned them and therefore was that going to put a bank out of business and was

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there then going to be a run on the banks? and there kind of almost was and then the the governments came in and backs stopped it all um by supporting the banks and saying we will nationalize your losses and we'll we'll look after you uh and then everything got back again but it was a it was a really highly traumatic time for many people and for as a consumerf facing business in Australia where demand fell the currency went down we didn't have the capital s to sustain it but we had ongoing running costs

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Uh it we yeah we we blew the business up. So consumers were not buying anymore. You're paying for all the overheads. You're managing a $20 million operation with two other business partners. Yeah. What was going through your head when this was all taking place? Oh [ __ ] This is real. This is real. And yeah, I mean it it was pretty gnarly. We my wife was heavily pregnant with our fourth child at the time and we'd gone because six seven you know six and seven were kind of good years and we were marching through the teens

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of you know talk about hitting the brick wall and getting to 20 mil but you know 12 through 18 felt pretty good and you know we had a few people come and say we'd be interested in buying your business and like no no we're fine we're good you know we're we're going just just fine. So, um I I just don't think, you know, as a young entrepreneur then, back then, I'd built the the uh sufficient metal and and rigor into the business that I needed to and we were just stretched

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because we're doing men's and women's and and we had a high cost base to do the men's and women's and and again, you know, right idea, good idea, timing bad, execution not where it needed to be to go through the the the you know the storm which it ended up being a storm and relatively short-lived storm I don't know say six months GFC but it was brutal when you saw that demand and literally dry up really quickly um so yeah it was pretty uh it's pretty fullon are you seeing similar go ahead

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but it was also my greatest learning experience because as part of that one one of my greatest learning experience as part of that. Oh, and the oh [ __ ] moment when then I was working at night and and going right I got to I need to re we had to lay the staff off right so which is devastating good people we had to lay a bunch of people off and I'm like okay well I reckon we can resteer the business in a better direction but it needs to look like this which was better on price tighter on product assortment

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um focused on key doors and locations, working with the right part, you know, wholesale department store and tighter team, you know, good hungry tight team with some new capital coming in. I reckon we can get this going again. And I felt like I had that feeling of, you know, I used to play rugby when when I was younger and I I love team sports. So it was it was like being down on the scoreboard at Halime, but I felt like you could come back and put points on the board the second half and win the

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game. And so that that was the feeling in my mind. and I I don't know stubborn enough, stupid enough, wanted it enough to then so I re I just went really hard on building these Excel spreadsheets to retool the business and it gave me this analytical view of of where the business is. And I was okay on on Excel, but I got I got quite into it at the time. And I was also meeting with the smartest guys cuz we everyone knew we were toast. They're like this is this business got in administration and and then was in

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administration. And so I was meeting with smart guys, you know, smart rag traders who were fine and had the balance sheet and had the assets and had everything kind of plugged in and could withstand the storm. And they were like, you got this, you got that, you got this, you know, and I'm like, no, no, don't really have that. Okay. So I was just making a mental note of all these different things that I then would go back and kind of retoled the business model for what I thought would be

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appropriate for the new post GFC world. So it was a great it was a really excellent thing to have learned and you know it's it's it's actually we I it was foundational in terms of how we've we've come out and built MJ Bell. Now, are you seeing similar signals in the market right now with what's happening? No, I don't think so. There's this there's this macro thinking that um the central banks have got the back macroeconomics thinking that the the c uh the central banks have kind of got

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the backs because they do the money printing, the backs of the community and the banks and everyone. And what they do is they cut rates and they add more dollars into the system or euros into the system or Chinese yuan or Japanese yen into the system and it floods it with capital and everything kind of gets washed over. The problem is though with that additional money printing the hurdle rate of just to stay in the same place year on year on year is around 8%. because of the devaluation of the currencies. So

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the do I think that's the case now? I don't no I don't think so. I don't think it is the case now. I mean I'm again I'm a hardwired optimist but I'm also a realist and I think that so long as the collateral of the system and that's equities and property doesn't get a big collateral shock then things will continue on. I think it'll be hard though. I definitely think it'll be hard and maybe we'll go into recession. Yeah, maybe we will. So, if you think about the competition and

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there's that term that a high tide rises all ships, equally a low tide um can harbor ships in the sand. If the tide's going out and people are starting to get bogged and sink into debt and ask favors and frets and pull back spending, it seems like potentially competitors at large would be contracting or shrinking or playing it safe right now. What advice would you have for someone um who wants to take advantage of the competition in whatever their space is? Kind of back to the beginning, you know,

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work with your team. Work with work work with your team and as a team. And I love it. And again, Mark Builton, I know you you had him on the pod the other day. He's legend. He's a legend, Mark. He's exceptional. So, we get in a room with Mark once a quarter and um all our heads sit down and we we have these 90day sprints and and the strragile piece that that Mark talks to and everyone puts their views forward and we we talk about you know kind of a different version of a SWAT, right? But strength, weakness,

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opportunities, threat and you know what what should we do more of and less of and how how do we stay agile and strategically agile in challenging environment and I just think pull your team in uh and and because the IP within your team and again we've got a retail business and an ecom business and a uniforming business um where we kit out socceroos Aussie cricket team walabes these um other other elite sporting guys um they know what's going on. Your team knows what's going on out there. They've

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got it and they're smart people. So, you got to get in there and then I think devise that plan and then you just got to work. You got to work and be clever. But I think you know it's not it's not all a doom and gloom story, right? Again, back to my point of we live in paradise, but the equation is tighter. I was talking to a lovely guy this morning. He's in in the industry as well, and he said, "It's just really hard to make a profit at the moment." And I'm like, "Yeah, I think you're

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right. Everything's priced to perfection, but it's really hard to make a profit at the moment." If you look at the market right now, customers seem to want or be looking or demanding cheaper prices, um, more ethically made products, higher quality. Is this realistic to be able to sustain low prices with all of these other things that consumers are now expecting in products these days? Yeah, that um that's a really interesting one because if you talk about sustainability, right,

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sustainability costs, you you need to ensure that the provenence of a product I the it's clear where you've sourced the product from. uh you need to be uh clear that it is uh made in a way with the correct um labor force to to sew things and humane conditions to to make things and bring them to market. Um and to do that that all has a premium. You then need to ensure that you've got the correct distribution for that and and it does add up and it does cost more. I think you know rewind 15 years

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right organic food was less abundant organic food was less abundant 15 20 years ago now there's more of it but it comes at a premium so the same in you know food or fiber um you you've got the same things going on you know great wool growers in Tasmania with a 16 micron product like Simon Cameron fantastic fellow we've been working in Kingston farm where we have uh a single source uh marino that goes up to Italy. We weave it. We make it into suits. We sell it to our customers and we give a rebate back

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to Simon because we want him to be sustainable over over the long term. He's a sixth generation wool grower. He won the Zenya Prize a couple of times now. He won it this year and he won it last year, the year before as well. And when you've got that level of elite uh wool growing, you've got to take care of it. So I mean on Simon's property is uh 3% of uh the natural grasslands that are still left in Tasmania. Wow. And he Yeah. He's out there constantly taking care of that. He's,

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you know, he's here in Sydney and he's down in Tasmania down near Ben Lemon there out of out of Lawn Hest constantly looking after that property to ensure that he can hand it on to the next generation in in a better than he in a way better than he found it. And we we love that, you know, from from my point of view. He's a Simon's a true gentleman, but we're helping him and this idea of grassroots community to, you know, keep his his um farm rolling in the most sustainable way into the

00:36:42 - 00:37:51

next decade. But that all costs, that's really expensive stuff. And you know, we we want to support it, of course. We're proud of that, but it costs more. Back to your original point, it has to. I know this strikes close to home for you because as I understand it your father was involved in that in some way, shape or form. I understand and Josh has just mentioned this to me in passing is that you have a story where you grew up kind of questioning um how and why your father was essentially selling

00:37:16 - 00:38:30

wool. Yeah. Yeah. And not necessarily moving through downstream to make more money. Yeah. And I you're right and and dad um was a wool grower is now no longer a wool grower. However, I mean you could apply this to the whole industry where we would grow the finest fiber in the world and Australian wool is you marina wool is is revered globally as the best and we didn't we never value added and all the all the production you know all the processing facilities moved offshore. Uh there's a

00:37:53 - 00:39:13

tiny amount of them left in in Victoria. Um but you can't produce anything here fundamentally. Uh and uh and MJ bale I mean the bale the concept of the bale is well these we've got these wonderful natural fibers the best in the world. Yet we sell bales bales are wool. But I wanted to go beyond what what's inside the bail and how do we create that into a tangible product for our consumers to wear and give much better traceability and circularity of that product and value add it not just as in a in a um

00:38:33 - 00:39:41

generic commodity which the bulk of wool is just sold into market and off it goes and it's traceability is improving I got to say however the bulk of wool is just sold into the general market. No one knows where it goes. Okay. Do you think that having this purpose has driven you to build this? Yeah, 100%. Purpose, but also I I saw the opportunity. So, you know, whilst um you know, for it's it's crazy, right? We're the country that grew up on the sheep's back and we didn't value. It was like

00:39:07 - 00:40:14

the most to me it was the most obvious opportunity uh to to actually and you know we in over the years we've partnered with Walmart and um that's been great and they've been really helpful with you putting us in touch with better wool growers and product development and marketing and different things. Um but we need to do more. You know, the wool grower out there is LA, depends on your scale, but largely at break even. At these prices for marino wool, you're pretty much at break even. And

00:39:41 - 00:40:48

our wool growers to sustain these family farms. I mean, these are big communities in our in our culture in New South Wales, Victoria, Queensland, South Australia, Tasmania, all around the the West Australia, eastern seabboard. We need to look after them. And at the moment the wool price is not at a premium such that farming communities are making a profit out of it. So the value adding thing was obvious to me and and I you know I wanted to I wanted to do more and and we have ambition to continue to go further

00:40:15 - 00:41:28

you know like what's natural fibers company what like 97 98% of our fiber selection is natural wool silk cotton linen is is what we deal in. If you look at it from an entrepreneurial perspective, it makes sense. We have this resource that's not completely capitalized on logically makes sense. You're also talking about something that means something to you that you feel that beyond making a profit, beyond building a brand gives you some sense of purpose or fulfillment. Yeah. If if you

00:40:52 - 00:42:08

look at a business, I guess from ingredients, cash flow being one of them, What else do you think you need to really make sure that the engine keeps humming and that you can sustain yourself through hard times? I I reckon that idea, you know, the and I it was awesome hearing you and Josh talk about it last week. There's that the the univers it's a it's a um a Buddhist concept uh the universal law of nature which is the creative maintenance destruction. And I think you just need to keep putting the accelerator on the

00:41:29 - 00:42:40

creativity and then make sure you've got the maintenance structures there. You you've got to lead with creative and maintain and then destruction doesn't come on unwantedly or in in a in a tragic way. Um that that ruins your business. So I think keeping those two in check super important to keeping the momentum and the you know the locomotive going and building and also that that I think that probably does go back to your energy point. So which one's you know it's probably the energy that then

00:42:04 - 00:43:06

brings the the the the cash. So I think you're right that's the derivative of the energy. Um, so you've got to drive that creative maintenance to keep keep the furnace going so that you keep that momentum rolling. Especially in the beginning, I think there's been times in my business where, you know, early on there would be challenges with cash flow. Yeah. And certain people on the team would say, "There's nothing we can do about this." And as the entrepreneur, you were like, "Yeah, there is." You're

00:42:35 - 00:43:32

like, "There [ __ ] has to be." Uh, and they're like, "Well, what is and you're like, we'll figure it out. But I think sometimes in entrepreneurship, that's the whole point. Yeah. Is we'll find a way. It's not easy. But your head is constantly in this state where you're like, I'll figure it out. And it has to be part stubborn, part stupidity, but part creativity. And I think that requires a tremendous amount of energy to persevere when it doesn't make sense.

00:43:04 - 00:44:16

Yeah. Well said. I think that's spot on. Yeah. Now to the creation piece. What exactly do you mean like what is it that a business owner can do to be proactively creative? Uh kind of back to the original, you know, I think you got to constantly review the product or service that you're selling and making sure that you're doing it in the best possible optimistic, happy way that keeps your customers coming back for more. I think that's number one, right? Beyond that, you know, challenge your thinking, bringing the

00:43:40 - 00:44:42

team in, what do they think? You know, researching with your customers, what do they think? Um, creating could also be entering a new market. You know, we're we're looking, you know, on the back again on on the back of this um world's biggest island, wonderful place to be, but gee, it's expensive here. I'm looking offshore now. Okay. And I look offshore and I see a bunch of opportunity because there's more people who are being potentially underserviced by the incumbent brands we're up

00:44:11 - 00:45:12

against. And I think having grown up in, you know, I think we got an edge on our natural fibers and provenence story and product storytelling. And then I think when you bundle all that together, we can outperform them because we've grown up in the mean streets of Australia. Yeah. Right. Because it's tough here. It's tough to grow and scale a business in Australia because you've got, you know, all the things we spoke about before working against you. And so then you look at international markets and that's

00:44:42 - 00:45:57

not easy by the way. You know, you got operationally you got to execute and be clear on it. But my real belief and there's some fantastic examples, right? Um, Rufus D to Soul in music. Uh, Asop skincare, fragrance, Zimmerman, women's fashion, all world class. You know, Harm Williams boots, great boot, world class leads their categories. Uh, look at some of our athletes. Look at, you know, we we've got a high high performing, high functioning country and talent here that can totally export to the rest of the

00:45:19 - 00:46:25

world. And I think, you know, Aussie conditions steal companies for performance overseas. What do you mean by that? Well, I think it's hard. You know, again, back to the point of if if you can do retail in Australia, I think you can if you if you're good at at retail, I think you can do retail with the best of them. So long as you've got the correct uh assets around your business, balance sheet, people, processes, systems, formula, creativity of how you display the store, product that can, you know, beat the

00:45:52 - 00:46:55

competitors, you can totally win in overseas markets. Yo, my name is Dan Walker and I am disgustingly obsessed with branding. I had to figure out a way to do branding every single day, so I branded myself. Then I started my agency Rival and hired a team of branding mavericks hellbent on creating brands so good that they'll make your competition their pants. So here's the thing. You want your brand to go viral and Rival makes brands go viral. That's why we're offering you a free 30inut branding

00:46:33 - 00:47:34

session to get an expert's opinion. If you don't believe me, the proof is in the pudding. Here's what clients have to say about Rival. Rival is trusted by brands like Nutrition Warehouse, Fly My Bricks, and Voom. So, if you want to absolutely smash the competition and make your brand go viral, hit the link below and book in your free 30-inute branding session. If you look at MJ Bale and you look at the market that you entered obviously and we can't we shouldn't name them all but there's a lot of men's yeah

00:47:03 - 00:48:22

brands in the Asia pack. What made you feel that like we can do this we can truly bring something different and how we how were you looking at taking on this part of the market originally? Um so I grew up as a you know in this I did UT I went to UTS I did a business degree I made majored in marketing international um trade and and marketing but then I was and then I worked in London 93 to 97 and I was out there in London and and I was working in the fin I was working in the city in the finance industry and I just really like the

00:47:43 - 00:48:49

whole um vibe of London. with vertical retail brands where a brand would put in its own stores rather than selling through a department store. And so that's how I kind of it it um gave me the interest to start a clothing business. But back in my old herring bone days, we had our own factory in Sar Hills. Wow. Making shirts. We'd knock out 500 shirts a week. Yeah. Yeah. Wow. Yeah. and Bernardet and Maggie and Rosa would would run the factory and our offices were there and level two 2 to 12

00:48:15 - 00:49:39

Favo Street and they were good days, you know, but and we were making so I learned from the cutting floor up, right? And and so I spent time with our seamstresses who were all old school seamstresses and knew how to make a wonderful shirt. Um when you have that knowledge of of garment making in the correct way and you have your own taste level and you know uh quality expectations, I think you got an edge right over many who are just kind of traders of generic stuff whatever that is. So I just felt I had a better

00:48:57 - 00:50:08

um idea of that you creating an authentic product of integrity. And so when I looked at the competition I'm like I can do that and I I think I've got the right idea on fit on fabrication on on quality on stitch count on button and how to make you know the the right aesthetic appeal of of the products. But also I want to bundle it in a way that's better value. I want better price but also better product. So price times quality, service and brand is the value equation in the way I see it.

00:49:33 - 00:50:44

And I think if you just look at the metrics of what that is, if you're great on service and you're actually telling that to the consumer and this is a wonderful thing about men's wear that guys come back for the same thing season after season, year after year and they they honor that. if you respect them and take good care of them and and I think that makes it a lovely linear business to be involved in. A small anecdote. So I I go out and I see the the um all our weavers of the fabrics in

00:50:07 - 00:51:26

in Europe twice a year and every time I go you see all the like rock stars of the men's clothing industry. They're all there on day one or day two of the fair, they've all got their own little time preferences. Um, and they're there. And so the the Napoleana tailor with the cousins and the grandfather and the father and the other kids, they're all there. There's like six of them around looking at looking at the set of fabrics for for the new jackets for the season. Zenyas, Paul Smith, Laura Piana, like

00:50:48 - 00:51:53

they are all there. Brunella Cuchinelli, all the all the absolute rock stars of the fashion industry are at these fairs just doing their thing. Why? Just doing their thing because they're they're product people fundamentally. They're product people. And it's also often a family business. I mean, for those guys, they're they're founderled fam andor family businesses. And I don't know, they just why I I think a they're passionate, they love it, but B, it's it's what they do and

00:51:21 - 00:52:22

they're and they're exceptional at it. All the best ones, they've got their hands on the wheel. All All the major brands in men's wear, they got their hands on the wheel. Phil Knight at Nike, product obsessed. Yeah. And when he was in there, it was killing it. right now. A few other people have gone through and then they've had, you know, the share price has changed a bit, but it's gone down. It's not performing as well. But when Phil was in there, it was killing it. Right. Yeah. When you look

00:51:51 - 00:52:57

at these people at these fairs and you're seeing second, third, fourth generation families investing in this trade. Yeah. The rag trade. and and they're at these events globally and they're all kind of in the same kind of rooms weaving through the same types of um networks and and relationships. Do you think to yourself that those that try to get into the game purely out of I want to create monetary gain here. I'm going to create a brand. I'm going to import products. I'm going to market it

00:52:25 - 00:53:35

really well. Do you do you see that as a disadvantage versus those that genuinely love creating fabrics and selecting the cuts and investing obsessively into the nature of the product? Yeah. I think if you're if you're in the the clothing game and the retail game, you've got to be obsessed about the product like and looking after your customers. And that, you know, there's actually some other, you know, great people here in the c in Australia who are doing a good job in in custom tailoring and and they, you know,

00:53:00 - 00:53:59

they they're really focused and looking after what they do and they're passionate about what they do, you know, and come with the right mindset, I guess, to to really servicing their clientele. I mean, I've mentioned the Zimman girls before, fantastic, right? I mean, Nikki and Simone, they're still in the business, you know, if if you take this productled approach uh and this philosophy about how you like to see it, how do you break it down into a science? Like, take me deep into how do you look

00:53:29 - 00:54:36

at product creation for you in your space? What are the things that make it um that allow you to understand this will do well in the market, this won't, this is how we're going to sell, this is where fashion's going. like how do you really zoom in on what makes that magic work? We're kind of fortunate again men's wear linear business and it doesn't maybe you know jump around as say women's web does. Um you know early because you you see these affirmative cues you understand

00:54:02 - 00:55:10

like uh systems and reports help you understand what's sold in the last 12 months last season things right historical data. 50% of our B roughly 40 to 50% of our business is is pretty much core business that guys come back I'll take navy suit white shirt tuxedo chinos denim jean whatever polo s there's a there's a lovely consistency which is what I one of the things I like about the men's wear business because it's kind of that annuity business that rolls year after year so risk adjusted it's not so

00:54:36 - 00:55:31

volatile you can plan that in so that's all about delivering the milk on time to the stores and making sure you got it there ready to look after your customer and then you know as your members or customers come in making sure that you you're doing a great job looking after them and and fitting them in the best possible way. Um, when it comes to the seasonal products, that's when you got to say, right, what is it? Is it green? Is it orange? Is it, you know, mauve that that that's going to sell now? And

00:55:04 - 00:56:24

so, you sort of run color analysis, you run silhouette analysis. This is part of the problem though because it's all regression analysis. So, this go back to singularity. Everyone kind of looks the same. And you know Mr. Porter, right? Yes. Yeah. So, Mr. P Mr. Porter puts it up and people go looking at what that is and sure enough it's there's derivatives of that stuff and things kind of look the same. So one of the challenges of this this immense digitization and e-commerce world that we live in, you

00:55:43 - 00:56:54

don't get unique character. That's why I love Japan because you still have a lot of character on the streets where people get dressed up in different ways and and they really, you know, from a styling point of view, they take it to the nth degree and they're really precise and cool about what they do in all sorts of ways, right? Um there's a sea of sameness in a way out there that is part of the challenge and and you need to creatively challenge that to find some new space. You see it

00:56:19 - 00:57:25

in sneakers. You see it in in men's wear. You see it in women's wear and nice dresses and things like that. And again, you know, Neta Porter, Mr. Porter, great businesses, but they've kind of made it all the same. Okay? And then department stores make it all the same. and and you know the plan the merchandise planners are really powerful in in clothing businesses and I'm constantly having the chat with with our team fantastic merch planners and great people. What exactly is a merch planner? merchandise planner again

00:56:52 - 00:57:56

looks at they're kind of like a portfolio manager of a if you know your super fund and you put some into that stock and some into that stock and some into that stock. So they'll look at your different categories of say you know jackets and shirts and trousers and whatever knitwear and they'll say right we sold like this and we saw this kind of growth rate we you know we think moving forward we're putting in these stores and they'll look at it at a skew at a size level at a skew level at a

00:57:24 - 00:58:19

style level uh at a geographic regional level from a color point of view and they'll they'll pull up what they you know their their view of the merchandise plan which is kind of like your investment strategy for the future season. Wow, I didn't know that. Yeah, but this is look, you've got you've got to have a dynamic debate on that. Otherwise, everything just looks the same year after year. And it can't there's a there's a again with men's wear, there's a consistency that people

00:57:52 - 00:58:41

like that, but you've got to keep pushing a bit and to to make it fresh and keep it in. You got to create and maintain, right? So, you've got to pu push a bit more on the envelope. So, I always say when working with our with our product and buying team, I'm like, you got to get a little bit uncomfortable. You got to get a little bit uncomfortable, you know, and you guys aren't going to like this. Like, this is it's not going to be an obvious investment decision for us to make on

00:58:16 - 00:59:24

this set of products. So, we have to keep pushing that envelope a bit. What are some things that you're doing now with your team to try to push boundaries in fashion? uh so our our our Providence so Providence sourcing from a really specific location um I think that that's world class no one else is doing that in the world literally um what we're doing and and there's a bit of a uh because fine wool is harder to come by and the amazing farms and we we're super fortunate to be

00:58:51 - 00:59:58

working with Simon Cameron down there in Tasmania um and we're also talking to another wonderful farmer in New Zealand, South Island, New Zealand about a program that's coming through there. I think doing more of these direct sourcing things and then bringing it back to the community and sharing that story with our consumer is is something that we hold dearly and we've done it for many years now and we'll continue to do more on that. Um, and then we like we like to do madein capsules. So, we we

00:59:24 - 01:00:30

did a made in Japan. You should check out the Japanese denim we did. I'll check it out. Very cool. Um, we we did this wonderful little made in Japan capsule. Next stop for us is is made in Italy. We're doing a made in Italy capsule of, you know, some just a little edit of of product. That's cool. So, you're working at a really deep level with with the um some specific masters of their craft so that you provide a really authentic product. I think that that's really important to us

00:59:57 - 01:00:58

to to do that. I mean, we we provide a mainline that is authentic and very consistent and, you know, we we think it's of high quality and high value for our customer, but it's lovely to do these extra little projects where you're collaborating with Japanese artisans and Italian artisans to do do their things. and we'll we'll continue to move that around to different um locations in terms of sourcing. And that's one of the nice things that having a few stores and a bit of scale behind the business

01:00:28 - 01:01:24

enables us to do. You kind of you can think like a boutique, but you're not risking it all on your one boutique, you know, and okay, so when it comes to what you've built with MJ Bale, how much of this do you think is branding versus product quality? And I I separate them momentarily because a lot of business owners believe they truly have the best product. I think your product is fantastic, world class, worldrenowned. You're using incredible materials sourced from yeah a very beautiful

01:00:56 - 01:01:53

narrative and it stems back to your purpose in your childhood in the best possible way. But when you think about the branding element, how important is this in fashion? For example, if I buy a suit from this retailer, I become this type of person versus a suit at that retailer, I become a slightly different type of character. It's almost like I'm subscribing to a different tribe, if you will. Surely a large portion of the market are just like, "The suit looks great. It fits great." But the people

01:01:25 - 01:02:36

that obsess over returning, I'm going to ride or die MJ Bale or, you know, Mr. Porter or what have you. I like it. How important is the branding? Yeah, branding is super important. I mean you you know perception is reality key key point of of that branding and again you know back to you think about vodka or tequila or or or beer it's kind of fundamentally the same product inside. Yeah I mean to to slightly better or slightly worse qualitywise but branding can be huge. you know, was it Clooney who did that

01:02:02 - 01:03:15

tequila brand and flipped it for a billion or something? And he did an amazing job on Kazmigos. He was part of that Kazmigos thing. Beautiful branding. You know, I think branding is super important and you know the Ryan Reynolds did it with um uh I think it was a vodka brand. Yeah, totally. M branding and positioning and aspirational marketing, right? So, it it's a really good question to to think about for a bit because branding's huge. Branding's huge, but if your product doesn't live

01:02:38 - 01:03:52

up to the hype, it's pretty short-lived, don't you think? I would agree. Yeah. Uh and and I it's not either or, it's definitely both. Yeah. And Nike's made some of the best campaigns ever. Wonderful Goosebumps stuff. But if your Nikes don't live up to what you want them to be comfortwise or they wear out too fast or I don't know a rivet's not right or something that's a problem and you lose customers pretty quickly. You know this sort of this idea of raindrops to build a brand

01:03:15 - 01:04:20

equity and buckets how fast you lose it in buckets if if you've got a product fail. So I think it takes a lot of effort to build that brand and I think branding is seriously important but equally it's shortlived if your product doesn't deliver when everyone else is kind of going the mainstream route of like import a good product export it you're talking about getting on the ground touching the product talking to the families bringing in this authentic narrative I think that's exceptional when it comes to

01:03:48 - 01:05:05

branding what additional edge comes through the actual artistry of caring about creating a beautiful jacket or a certain cut in the pants. Like take me into the artistry of like what is it that you really think about when you're trying to create a gorgeous product for men globally. I think you you really need to ensure that the fits are correct. You know, fit fit's critical, right? Beyond the material that's coming in to be, you know, s like sourcing of material is critical. Whether it's it's yarn to to

01:04:26 - 01:05:28

make to to knit a t-shirt or or a jumper or whether it's um a bolt of fabric, a roll of fabric to be then be cut up and and sewn into a a woven product, which is a shirt or a jacket or pair of trousers, whatever. um fit, form and detail is important and then construction techniques and that's kind of the simple summation of it. But what's fit, form and detail? Go into that. Yeah. Yeah. So, so on a fit point, you know, it's really ensuring you think about men's body shapes, right? And our

01:05:00 - 01:05:58

guys are quite athletic here in Australia. There's a lot of lot of people who work out, train, like to look good and there there's a certain vanity in it as well, right? So they want they want that fit form piece to be just so so it's the drape over the shoulders through the smaller back how it it works on your chest. Australians are often bigger in the shoulders and chest than say Asian countries and Japanese like they're they're much leaner. French guys are, you know, small like they're more

01:05:29 - 01:06:40

petite in the way they they cut a garment. But so we we build that athletic fit here for for our products. And I think once you've got that part and you're really mastering how the garment looks on the body and on the person, that's critical to for for the consumer. That's critical. Um so we spend a lot of time on that. And it you're never done. You're always evolving. always evol like, you know, shoulders softening up a bit or we'll put a bit more form in it or we'll drape

01:06:05 - 01:07:06

it a bit more. And now, of course, I mean, big times in men's wear is getting bigger again. You know, it's all looking a bit 80s, 90s, bigger silhouettes. So, we're having to evolve and and make them a bit less lean and, you know, a bit fuller in the body. And the young guys are wearing, you know, wider leg trousers and things. So I think getting that right and staying relevant on that journey of of fit and form is super important. The detail part sort of goes back to that character

01:06:35 - 01:07:35

and authenticity that I like to put into into products. And the way they you know where which a button hole is sewn or a button is handstitched on and um crossstitched and and you know with a with the loop on the shank to to make sure it comes through the button hole really well and and feels comfortable there. And it's just the these smaller points of detail and then you don't want buttons falling off. That's the other thing that's that's kind of a killer. I always have buttons fall off my suits.

01:07:05 - 01:08:06

When I see that it's a killer. It's like God kills me. Anyway, um but d you know the the trim like what what's there those little things when someone opens the jacket or under in a shirt or whatever else to give it a sense of character under what you're trying to put across. And of course highly subjective stuff. You know, some people like monotone and schle and evening and and really paired back. Other people like a lot of contrast or details or pattern or different things. But I think

01:07:36 - 01:08:44

it's important to curate that personality in the range so that you're covering off the the the character of the range and making sure that that product stands on its own as a beautiful piece. And then you know the the underlying quality of how things are constructed with the canvas on the inside with the material that you're putting into that into your into collars. We don't fuse our collars cuz we don't like like the way the glue bubbles when they go through laundering and things. But there's all these little

01:08:09 - 01:09:11

peculiarities of building a product that gives it that character to make it more um comfortable to make the wearer feel happier wearing it. when you're trying to think about the cut and the fit and the market and where where people are. If you bring the brand and the product narrative together, what are some of the things that you've done to really pull this marketing system together? Because I understand you've got the physical retail and the ecom. My understanding is with tailored suits or suits in general,

01:08:41 - 01:10:04

you have to have a retail presence. I think it helps. Yeah. um you know that that thing and it was the one spoke speaking about recently with marketing and brand which one's the greater and and you know and it's a fascinating thing to think about the the other way to consider it is product is the brand the brand is the product and and they they work in lock step but you can you can it can become iconic right and that's the holy grail I If you can if you can catch that. The Ralph Polo. Yeah. Or the Red Bottom.

01:09:21 - 01:10:32

Yeah. Shoes. Yeah. Or WD40. Right. Yeah. I love WD40. Works every time. If I could have shares in a in a company, I reckon I'd love to own WD40. If WD40 is listening, it does what it says it's going to do. And and I just think it it's a cool product. And you know, and it's the branding. The brand is the product. Yeah. So I think that that idea is is super important in consumer facing um businesses like ours. I just go back to that you know that character and authenticity that you've

01:09:57 - 01:11:09

got to have. And then you know you also then need the team to to pitch that and that's where digital you know team in a store to pitch it and the store environment needs to uh rhyme with the product and brand promise. And then I like to think about the digital as that sort of efficiency. I think with for guys it's the effic there's not much romance in shopping online right? Not really. But if if you can really nail the efficiency of you know through the checkout process uh through the information that's given

01:10:33 - 01:11:33

to them through the interface that that you know you're putting through the um sorry the experience you're putting through the interface and then fast delivery fast service and and making sure that they getting what they want in an efficient manner that's cool and then ease of returns and all those things. I do believe the future is omni channel where you need physical to support the digital and digital support physical. Have you found that they feed each other? Yeah. And there's really good

01:11:03 - 01:12:07

case studies on a bunch of different brands where where as soon as you roll out more stores then the digital penetration lifts. Um and if you do the right geo targeting of your digital and start selling into those markets, if you put a store there, then the whole thing just turbocharges. So, I think they need to go in lock step. And there's a bunch of non-physical or online retailers who haven't necessarily made it through, right? A few have gone into um whatever been sold cheaply or we're seeing this consolidation going

01:11:35 - 01:12:32

on. What What do you think is happening? Because you're seeing big brands that we've had for decades just go into administration almost overnight and it seems to be happening everywhere simultaneously. Yeah. uh it's going to happen. I mean, there's a it's removal of irrelevancy. It's destruction. It's it's the universal law of nature playing out. And it's not a bad thing because you've got to you got to have these storms that come through and and clear the system out for the

01:12:03 - 01:13:07

next gen to be able to come through and and you know, do a better deal on a store. Um have a bit more space in the market to be able to sell their product or or service. So that the storm coming through and wiping a bit out the you know destruction is not a bad thing in look if you're on the other end of it it's a bad thing. If you're on the wrong side of it it's a bad thing. However it's great for renewal right and you you see this on the on the on the planes in Africa. The Serengeti does it

01:12:35 - 01:13:37

the whole time right? There's there's that cycle of life. It's the universal law at nature playing out. And so I think the fact that there is a bit of a clear out of brands that are irrelevant now is not a bad thing because there's too much product in the world. Well, if you think about some of these brands, they're they've not really done anything in recent years and they didn't do anything creative or clever. They didn't update their stores. They lost relevancy. They didn't build influencer

01:13:06 - 01:14:13

marketing campaigns. They just stayed on a previous generation's tried and tested campaign. Now, in your case, you have over 80 stores. Yeah. And to manage that feels like an enormous amount of administration, logistics, hiring, HR, you name it. How do you make sure that with so many stores, you keep this integral, you keep this integral experience? like how do you make sure that the customer from store to store gets the same experience with the clerks and the staff like how do you make sure that that

01:13:42 - 01:14:43

system doesn't break? I think training is really important on that. Um again you got you need a great team. So we've got a a real structure of um CO got myself I'm CEO of the business got a COO we've got a head of retail we've then got um regional managers uh who are looking after it and then you got store cluster managers who are looking after that then you got store manager and two IC's and casuals around that. So there's a there's a true hierarchy of that and like I was saying before you know you

01:14:12 - 01:15:10

ideally you you've got the right team on the bus. If you got the right team on the bus, a lot of that stuff falls into line quite quickly. If you've got people who and maybe you know the great retailers aren't easy to find and and and in Australia, it's not like Australia has this long legacy of retail businesses and retail businesses in men's wear and tailored clo, you know, and garments that that we sell. So, you need to coach a lot of people. So training's vital and, you know, making

01:14:41 - 01:15:43

sure we're putting the right information and content in front of our team and working with them to to deliver that. And then it's about service standards and all all the good oldfashioned stuff of of execution. And whether it's a restaurant business, a cafe, or a a clothing store. I mean, I I say to our guys, you know, you can you can go and have the most amazing meal somewhere. If the service is bad, it ends up being an average meal. But equally, you can have a good, you know, a good simple meal,

01:15:12 - 01:16:28

but amazing service. You walk away going, "That was excellent." So, I'd rather have, you know, a better serviceled um business to complement our um product business. How do you make sure that your retail team have the right cultural prowess or the right talent or skill set? Surely training can help, but how do you make sure that that stays locked in place? Yeah. I mean, it's a constant challenge, right? Because um you need to try and retain your best team in there and everyone's got their

01:15:50 - 01:16:50

own personal agendas and there's I've worked with a bunch of people who've wor come in work with a business and then got fed up for whatever reason. They've exited and then they've come back again and they've gone out and they've come back again. So um you you just want to it's it's relentless. You you know you you need great people and great hierarchy to then especially around the country you know Perth and South Australia and um Adelaide and Hobart everything else you're relying on that

01:16:19 - 01:17:19

that team and that um org chart or structure really working for you and then you want to look after them. I we like playing games. So playing games of um you know business within a business. If their store is doing well, incentives are important. That's another thing. Uh if the if the store is doing well, we want our people to do well as well. And I think especially now, it's always important, but especially now that's important. And is it hard to run a business with strong integrity when um

01:16:50 - 01:17:54

the market can be so cutthroat? No, I think you need to be more have more integrity when the when the market's so cutthroat. I think you need to lean on those values and make sure that that that's correct. Uh and you need to, you know, continue to challenge yourself in a in a cool way. So I think look there's we we've said this a bit D there's no easy answers out there but the integrity is so important and making sure that the team are turning up and and doing and enjoying what they're

01:17:21 - 01:18:43

doing and and doing a great job is is super important. Now more about you yourself. I understand that your team are exceptional and I've um heard many good things through Josh about them. Has entrepreneurship made you more patient or more ruthless? Bit of both. Bit of both. Um and and you know I'm again I'm 52 now so you you start to see things in a through a slightly different lens. uh and my kids are growing up and so yeah, I think it's made me more patient, but probably equally I I

01:18:03 - 01:19:25

think I I'm very clear about what I like and don't like, and I don't really want to debate that. It's just like let's let's just do it. Um, and I think you've got to back your instinct on such things. Happy to hear a reasoned argument about it, uh, if that's the case, but I think you need to be ruthless. And and the other thing, the the competitor in me, um, again, when I see that market opportunity, I want to be ruthless. I've got to I've got to be ruthless there

01:18:45 - 01:20:06

because, you know, for example, you sign up on a six-year rent deal, you need to really thrash that one out with the landlord. You know, Westfield doesn't give you any free free deals. And I love Westfield. Well, our stores in Westfield, not all. I'd say 85 90% of them fantastic. They're great operators. But you've got to be ruthless to deal with West. You've got to be very very clear and uh back yourself in terms of signing that 5-year deal and getting in there and trading. They'll bring the

01:19:25 - 01:20:32

traffic, but you've got to do your part and execute really well. So, you've got to be ruthless. I don't think retail in Australia is if you're not ruthless, you sort of you don't really prevail. Why? because of the price of everything and and also the high expectation of our consumer like you know we we've got well not just our consumer I think you know the Australian consumer is is not foolish they're they're they're savvy you know the smart people and they know what they want and

01:19:59 - 01:21:12

and quite frankly I believe as a service provider for them they the customer is always right you know there's something really simple about that Yeah. Um, and you know, so you got to play within that that uh that's the game we're playing. You got to you got to play by those rules. Why is it that I guess with the success you're having and your opinion and belief on business and you've been doing this for some time now. Why do you think so many founders quit when things stop being sexy, fun, exciting, and

01:20:35 - 01:21:57

glamorous? Yeah, I'm not sure. Um, good question. I'm not really sure. Maybe it's some personal trait of theirs. I think you need to be resilient as a as a entrepreneur. You you need to be ready to fight the fight over a long period of time. I mean, we've been going 16 years now and you know, we we've grown up. Our revenue is about 100 mil and I really want to take it to the next level but we're having to be really patient here because you know contextually it's a grind out there and

01:21:16 - 01:22:32

we've got to keep keep building it out and work on those competencies that make the business more robust such that we can come out when the market opens up a tad more then great we can we can profit from that um and continue to Bro, but you know equally I think you know call it karma or whatever else like you've got to take your patience. Someone told me a fantastic entrepreneur told me just open up that box every day and take your patience pill. Yeah. That little imaginary box. Take the patient's pill and then get back to

01:21:54 - 01:22:59

work. And it's true, right? Like it doesn't happen overnight. It takes a long period of time. So, when it goes back to giving up, people giving up. Okay. Well, maybe they're just not cut out to be an entrepreneur. Maybe they're better off working for someone else. But don't. What do you think was like one or two of the best painful lessons that you took into the new business that you're like, never again will I do X again? I didn't really think about it like that. I just took those things on

01:22:26 - 01:23:29

board and curated a new set of ruthlessness in my thinking that I negotiated things harder. I mean, I got a shareholders agreement on this one. That's good. I've got partners on board. That's good. So, you know, making sure you correctly capitalize. It's a fun, this is actually an interesting one. So, there, you know, we fundamentally in the old were under capitalized relative to what we were trying to do. So straight away in the newbas I went out I raised money with great friends and family an old mate of

01:22:59 - 01:24:15

mine Matt Rogers legend ca came and said right let let's do this like you want to do it I said I'm on I've already got little bit of business with David Jones and kitting out a few footy teams and stuff what do you reckon you want to put some money into a rag trade business in the middle of GFC's like yeah sort Yeah. Yeah. Okay. And and uh and then he's like, "Yeah, okay. Let's do it." And then we'll raise some money. And the the key point to make is it's a function of time or money. If you

01:23:37 - 01:24:44

want to go faster, you need more capital. If you want to be patient, super patient, and have less capital in your business, and you're trying to fund it yourself, but own 100% then okay fine it's going to take longer and there's risk around it. So I I think to answer your question is right I'm going to raise capital going to do it really properly. All right. I'll h I'll own less of the business. However, we will be a robust business and we'll take advantage of and I'll have shareholders

01:24:12 - 01:25:16

on board and but we collectively will take advantage of the market opportunity that presents itself to us in men's wear and I believe that I could go and do that and thankfully great people came on board and we got a dozen investors now. Fantastic long patient capital that you want in your business. We've got an active board. Five of us sit on the board and we meet every month in a diligent way and it's all really professionally run like a mini private company. Sorry, mini public company or

01:24:43 - 01:25:51

private equity company in a way. And but we're able to take advantage of the market opportunity and so owning less of a bigger pie was better than owning more of of a smaller pie that was at risk. That makes sense. That that there's something in that. I mean, yeah, you're going to dilute, but if you've got the right synergistic investor on board, that's a good thing. How do you make sure you get the right synergy? You got to I think they need to be able to provide value to you as the

01:25:17 - 01:26:26

business operator and owner if they're going to come on board. I don't think you want I think it's hard for just to take on cash these days like with with unless there's a very clear pathway to an exit that and a ramp up and then out great that's fine but the hard work and especially these days is is in the operations is in the networking is in the relationship building and and you know delivering on the revenue. So ideally you want people with the synergies who can help you with

01:25:52 - 01:27:02

your operations or with your revenue building or with the intelligence the collective intelligence around the business as well as the capital and if you do that I think that's how you find the synergies but then you also want to make sure that they're you know you you you want to ideally you have shared values as well. Yeah I I think values is really important. I mean, if all of a sudden you're falling out with one another, that's not great. And you know, so being careful with the way in which you

01:26:26 - 01:27:32

um set up your shareholders agreement, etc., etc., is is also really important. Income, equity, control. I was also this is a good one as well, like um you've got your income, fine, then you've got equity, and then you've got control. And there are three distinct things in a business. And if you can think about them independently and make your decision on those three things, how much control do I have? Operational or legal control. Equity, how much equity do I own in the business? And does that

01:27:00 - 01:28:08

meet what I'm after? And then income, am I making enough money or, you know, base short-term incentives, long-term incentives to keep me happy as a person? then it's a good it's a good way to think about those things cuz you're always going to trade off, right? At some point, you know, if you intend to build a company beyond yourself that's going to be inherited or what have you, this stuff has to be thought about. Yeah, totally. In closing here, there's a few last questions.

01:27:34 - 01:29:12

If you think about yourself in this space and what you're creating, how do you want to be remembered? I would like to be remembered for um the work we did to create wonderful products on our most famous fiber and and for somebody who was a visionary that really put uh you know Australian wool and natural fibers onto the global stage. And then the the other thing is that that you know as I said I've got four children for them to be able to benefit from that and that's one of the things how the the business is shaped a

01:28:26 - 01:29:26

bit differently now it's interesting because they can come and learn in a really dynamic space. So that generational idea of giving you your children an experience, I'm not bothered if they stay around in the business or not. Um or join the business or not. It but hopefully they've they feel like they've got a a you know a landing pad there to then go and do what what they're passionate about doing. And I think that's a lovely feeling if as opposed to going and getting a cold

01:28:56 - 01:30:18

corporate job and bouncing around or sitting up looking at the light bulbs and going what am I doing here big you know small cog in a big wheel. Yeah thing that that anyway so I think that yeah it's a nice thing to pass it on to other people. And is there a quote or a mantra that you've carried with you on this journey that you wished all the listeners of today's episode would just carry with them on theirs? [Music] Wow. Um the I think there's there's a great thing I learned at uni actually uh that

01:29:37 - 01:30:56

change is the only constant. I mean, the only thing you can count on these days is things are going to change. And I reckon it is even more true today than ever before because the rate of change is accelerating in almost an infinite way for for everyone to grapple with. That's a beautiful quote. It reminds me of um this funny story that Jim Ran shared and he was in the boardroom at the Shell Corporation. Yeah. All right. And um they had paid him to come in and do an analysis and a talk and he was working around the room

01:30:17 - 01:31:24

and they all had questions for him around the future and how they should innovate as a company and what they can do to accelerate. Uh and he goes, "I've got it." And they're all like gripping their notepads and uh he says, "There's one thing you can expect around the corner in this business." Yeah. And that's change. And he's like, it's uh it's we're in a changing market. And I think right now everything's changing. Yeah. And if you can't change with it, you're

01:30:50 - 01:31:56

going to get smashed. And I think that if you want to prove yourself as an actual entrepreneur, now's the time to do it. Yeah. There's no no room for the attitude in this market. I appreciate you being here. It's been deep, insightful, thoughtful, meticulous, and just fascinating what you've built. And I just I love how much heart and spirit you've put into the narrative behind this and how authentic you're being and how much you care about, you know, the men's fashion space and doing something

01:31:23 - 01:32:05

important. And um yeah, I I agree with Josh. He believes you're creating a legacy. I believe it and uh I'm excited to see where it goes when it goes to the US and and that expansion and um we would certainly love to have you back. Good on you. Thanks, Dane. Thanks very much for having us today. Thank you so much. Appreciate it. Cheers, mate. Thanks, mate.