Farmer politicians evolved a plan to set up a monopolistic end-to-end wool trading entity called Wool Partners International. It was to be mainly-based around the core business of PGGW (Pyne Gould Guinness Wrightson). Initially the company was chaired by former Telecom CEO Theresa Gattung. Experienced Wool Industry grower-owned exporters, brokers, private farm wool buyers, exporters and some end users did not agree the wool industry needed to restructure. They were united in their view the WPI’s plan was flawed and the new venture would fail, taking the rest of the industry down with it.
Morrison McDougall was hired by the Wool Exporters Council and the Private Merchants Federation to balance the Wool Partners International media campaign. The tactic was to identify positive elements to the existing wool selling structure and highlight the potential dangers of an inexperienced exporting monopoly acquiring the entire New Zealand clip. Those united against WPI believed wool’s salvation relied on better, coordinated international marketing, which included initiatives such as resurrecting the Woolmark to create shopper demand. They also linked up with the Prince Charles inspired Campaign for Wool and funded New Zealand’s participation from their own resources. A road show presentation by WPI directors and staff launched a prospectus to raise $60 million. It was the ultimate test of whether the New Zealand Woolgrowers wanted to participate in the WPI business model. The woolgrowers stayed away in droves and the directors were ultimately forced to concede defeat.
The Business Lesson
Don’t get into a commercial battle unless you have the commercial experience in the field. Anyone who underestimates the intelligence and ability of New Zealand’s farmers to sort the chaff from the wheat does so at their peril. The wool export industry has long operated on honesty and trust. Long term relationships are hard to break for new entrants with little or no experience.