Historic Australian textile business, Geelong Textile Group, is on the market for sale for the first time in 40 years.
The business, which has been in operation since 1920, is up for sale after the current owners' (the Dimmick Family) children are not pursuing a career in the business.
The Geelong Textile Group is made up of two businesses – Geelong Textiles Australia and Geelong Dyeing – and supplies quality upholstery and apparel fabrics for commercial and domestic use.
In its long history, the business has supplied material for the Australian Test Cricket teams’ baggy green caps – made famous by every captain including Sir Donald Bradman and Ricky Ponting – as well as the fabric for the Sydney Opera House seating and the wool bunting for Sydney’s AMP Historical Building.
Adamant International MD John O'Connor is tasked with finding a buyer for the business.
"The Geelong Textile Group is an interesting business. Its storied history, quality and diverse product range, its potential for expansion, and its stable, highly skilled, workforce means prospective investors will inherit a going concern capable of generating increased profits almost immediately," he said.
"For the past 41 years, the Geelong Textile Group has been owned by the Dimmick family.
"The younger generations have pursued different careers, but they are committed to finding investors for the businesses to ensure continued employment opportunities for the experienced workforce as well as offering the purchasers an established, respected commercial enterprise with current suppliers and customers.
"Since the pandemic circled the globe, every country with a manufacturing base realised that making things at home to protect against disruption to supply chains is vitally important.
"This industry, in particular, has benefitted from increased interest," O'Connor said.
O'Connor explained that the increased import costs and supply chain disruption brought on by the pandemic, have made the purchase of a business like Geelong Textile Group a smart move for investors looking to reshore their manufacturing.
"In 2019, the cost of shipping a container filled with fabric from China was $1,500 - $2,000. Now it’s $11,500 US dollars.
"The extreme rise in freight cost is loaded on to the price of the textiles, which means Australian made materials are, once again, price competitive.
"Fewer vessels arriving in Australia, because they cannot easily backload, means long lead times for textiles ordered from
overseas, which can be supplied from Geelong in days not months.
"The company will attract investors who are passionate about Australian textiles, manufactured from Australian wool; and who are interested in the opportunities presented by the reshoring of textile manufacturing to Australia," he said.
Additionally, the growth pipeline of the business is looking positive, with government contracts a key driver of growth going forward.
"There is also huge growth potential for investors, given that Australia’s state and federal governments have learned a hard and expensive lesson that importing textiles is no longer the cheapest, safest, or most timely option.
"Employment opportunities and security of supply has become a priority for governments everywhere.
"If COVID-19 has a silver lining, it has to be that common sense has returned to government procurement, where supporting the Australian manufacturing sector pays dividends for employment, communities, and taxpayers.
"Long term, lucrative government contracts used to be the foundation of Australia’s textile industry and in the past 12 months, the indicators are they will be again," O'Connor commented.
Over the years, the Group has diversified its operations and customer base, expanding into home textiles and upholstery fabrics made from Australian wool.
The business is also considering expanding its offering into custom blanket designs, including hotel bedding.
The combination of the Geelong Textiles Australia and Geelong Dyeing operations allows the business to offer both design and technical weaving services, and colouration and finishing of various fibres, including Australian wool, cotton, and blended fabrics.
"Expanding on its core services of commission weaving, dyeing, and finishing, Geelong Weaving Mill has diversified into a wide range of domestic products," O'Connor said.
"Woollen upholstery fabrics and a home textiles range, including a blankets, tea towels, and a fashionable woollen version of the iconic Aussie Flannel check shirt, represent a growth market for the company.
"Geelong Dyeing has also released a stock service making, machine knitting yarn and wool tops available in stock and custom colours, for the craft industry.
"More recently, the company launched its online presence to cater for the shift to online supply of products to both the domestic and international markets," he said.
O'Connor added that the business is anticipating the purchase to be hotly contested by interested parties.
"We are anticipating a lot of interest in the Geelong Textile Group.
"Australia’s domestic need for quality textiles, plus its proximity to over two billion people living in Asia, the majority of which are moving into the Middle Class and who value Australian premium products, offers a huge opportunity to investors.
"Geelong is the largest manufacturing hub in regional Victoria with easy access to import/export ports in Melbourne and a strong and stable workforce.
"The Geelong Textile Group is a viable company with established brands. It has a growing and reliable supply chain, a loyal and long-term customer base, with capacity to grow," he said.