09/09/2019

9 September 2019
9 September 2019, Comments Comments Off on Gerry Ryan – Jayco Australia
Gerry Ryan - Jayco Australia

Interview

The winning racer

 

We met Gerry Ryan, founder and owner of Jayco Australia, in Italy at the start of Giro d’Italia cycling tour 2019, where he was supporting his Mitchelton Scott team who were competing for victory. This is an interview with the man who has an almost 50 percent share of the Australian RV market.

Words Antonio Mazzucchelli – photo Enrico Bona

Gerry Ryan was open and friendly when we meet him at the hotel where his cycling team Micthelton Scott were staying at the Giro d’Italia. He immediately asks us to call him Gerry, despite being one of the most wealthy men in Australia, and important in the global RV sector.
There is even a complete profile of him on Wikipedia: “He is an Australian businessman, investor, racehorse owner and cycling enthusiast. He is the owner and founder of Jayco Australia, as well as owning wineries, resorts, the theatrical company Global Creatures, and is part-owner of the online retailer BikeExchange and My Local Group. He is also a keen supporter of numerous sports. He became one of five inaugural inductees to the Victorian Caravan Industry in 2012 and was inducted into the Victorian Government’s Manufacturing Hall of Fame in 2014 for his contributions to manufacturing excellence. In 2011, with his son Andrew, he acquired Mitchelton Wines”.

Aboutcamp BtoB: When and how did you start your adventure in the caravan sector?
Gerry Ryan: I started as a fill-in employment when I came out of a property department at an insurance company. I was going to have a break and go to Perth during the mining boom and I walked in to this company that my university friends and school mates were working at during their school vacation. I was there a month. I was going to stay two months, just to get out of an office environment, and they made me a foreman, then five months later they made me production manager. I was 22 at the time, running 100 people, and then I had the opportunity to meet Lloyd Bontrager from Jayco US, the founder, who had a passion for Jayco and for Australia, and always wanted to one day do something. They were selling components to the company I worked for, but I had the opportunity, after I’d been there 18 months, to go and spend a couple of weeks at Jayco US to get some ideas for production. I came back with a head full of ideas, very eager to change, but unfortunately, two companies had merged and I was pushed aside. They didn’t want to listen to my ideas, so I decided I wanted to start my own business. I was about 24 at the time. I spent time studying both about marketing and supply, and I started doing repairs to get some cash flow and built my first prototype. That was in 1975. At the time the two companies merged, they didn’t want to import the lift system from Jayco in the States, so I said to Bontrager, ‘could I use the lifter system?’ and he said, ‘fine’. We purchased a few other components and he said we could use the name Jayco. He said he’d come out and see us and he ended up taking a 25 percent of the company, which the two boys, Wilbur and Derald own 10 percent today, so it’s been a great family relationship over the years. We’ve grown up together. So, that’s how I first started. We started producing one camper-trailer a day and in our first year we built 560 units; today we’ve built over 200,000.

Aboutcamp BtoB: What particular difficulties have you faced over the years?
Gerry Ryan: Well, the first or second year we came in to a credit squeeze. Growing a business, not having the experience in those early days, I made a lot of mistakes. It took me a while to realise that the greatest asset any company can have is its people, and more importantly, relationships inside and outside your business. We talk about the ‘Jayco family’. It’s some of the values I got from Lloyd Bontrager that culture, it doesn’t matter if it is in business or sport, is so critical. In terms of difficulties, it’s been growing the business, as the caravan industry gets hit the hardest when there’s a credit squeeze or a recession, so that has been tough, but the biggest issue is growing and having experienced people to grow with you. It’s important in Australia that we could develop our own people through training programmes. It’s a little bit different here as we don’t have the companies or the personnel that have experience in other companies.

Aboutcamp BtoB: How would you describe your company today, and is there anything you are particularly proud of?
Gerry Ryan: I am proud that we have maintained our market position and continued to grow. I think we have been innovators and we are continually looking to improve the product. We spent a lot of time in the early days following USA trends, but today it’s more European, and we’re looking for lighter-weight products, smaller products. We’ve been market leaders in innovation and marketing.

Aboutcamp BtoB: Why does Jayco have almost 50 percent of the market with no other comparable competitors, and how did you reach this goal?
Gerry Ryan: We never set out to say we wanted to sell ‘X’ amounts of units. What I always say is focus on developing the product and the product will sell itself. I spoke before about how important it is for people inside and outside your business. Our dealership hasn’t changed. We have got 31 dealers – three in New Zealand and 28 in Australia. We’ve had the same lot for the last 30 years. We haven’t grown our dealer network. We have created loyalty with our dealers. They are Jayco only dealers, and they’ve grown as we’ve grown, because we can’t grow unless our people, our dealers and our suppliers grow with us. My philosophy has always been that we sell through dealers, not to dealers.

Aboutcamp BtoB: How is the Australian market performing today, and what can you forecast for the future?
Gerry Ryan: The market this year has softened, and I saw that probably six months ago. I am close to some politicians and said to them that families are finding it tougher economically, because of higher fuel and electricity prices, and just the cost of living. In the last four months, the family market has shrunk by 25 percent. Overall, the market will be off by probably 17 percent this year, and maybe we’ll see a change of Government, as there’s an election in a week’s time, so I think things are going to be tough for the next 18 months. We’ve already seen, since February, probably seven manufacturers close their doors, but long term, I always believe that the industry has got some great scope, providing we provide the products that the customers want. I see three different markets in Australia: I see the lifestyle retirees buying the bigger units and travelling for four to six months around the country; we see the holidaymakers that vacation and want to go on holidays; and we’re seeing a new emerging market, an adventure, off-road market, with different hybrid-type units that they can put their motorbikes in, their electric bikes on, their canoes, kayaks, all the toys, and that’s appealing to the younger people. So, three distinct markets, so providing we keep developing products to suit the customer’s needs, there’s a future.

Aboutcamp BtoB: Do the European-style, lightweight caravans make sense in Australia?
Gerry Ryan: No, once again, our roads are a lot tougher – so you start with the chassis, the sub-frame – but for the styling and interior design we certainly lean towards Europe, but you need to build a robust type of product. Australians tend to put more in the unit, so you’ve got to give them a higher payload so that people can take what they want to do.

Aboutcamp BtoB: What are the most wanted products by Australian campers?
Gerry Ryan: Caravans are still the biggest market. Around five and seven metres is the size that people want. The market is for the lifestyle retirees, which is the biggest part of the market, and if you’re looking around the show, see saw the off-road, all-terrain style, even though the products might not go off-road, it’s all about the image, and that’s where the majority of the market is.

Aboutcamp BtoB: Do you think it’s a problem for the market in Australia that it has so many small manufacturers?
Gerry Ryan: The issue is smaller manufacturers providing that they can service and warrant their products, which is a big issue. We’ve already lost seven manufacturers so far this year, so who is going to warrant these product and back it up with warranties and spare parts? This is an issue with the industry, but they survive. Australians want a bit more custom building than what you find in the US and Europe, providing the help in the industry and finding the right product is always a position for a small manufacturer. I was a small manufacturer once.

Aboutcamp BtoB: What are the main features that distinguish an RV made in Australia?
Gerry Ryan: You’ve got to start off with the chassis. It’s rugged, with independent suspension systems, and we developed our own with AL-KO a system that’s used in Australia. Then you look at all the components, from Europe, America or China, so it’s probably styling. I’d say the biggest is the chassis, as I said, size-wise, we’re more American with bigger units but a lot of European styling inside and some European styling on the exterior, but the majority of the market is Aussie-style product.

Aboutcamp BtoB: Is there any other market outside Australia where you have achieved success?
Gerry Ryan: New Zealand – we supply New Zealand, and once again we have to tailor the styling and features to what New Zealanders want – bigger windows, they don’t need air conditioning, but they do need heaters. It’s like a French product is different to a German one. Australian products are different to New Zealand products.

Aboutcamp BtoB: Many RV manufacturers are starting to build and supply cabinets by themselves. Is it better to outsourcing or having in-house production?
Gerry Ryan: With Jayco Australia, we do probably the most integrated manufacturing. We build everything, through from our chassis, we make all our cushions and curtains all in-house. We got to the stage where some of our suppliers couldn’t supply us, so we developed our own chassis shop and fibre-glassing. We had a supplier who couldn’t keep up with our quantities and got in to financial troubles, so we purchased the company, but we always look to say ‘can we get that done more cost effectively and efficiently outside?’ If so, we’ll do it. We were buying a lot of components in from China in our early days, but the cost from China now has increased, so we’ve brought a lot of fabrication in metal and fibreglass back in to Australia. We can do it as efficiently and with better quality. We do all our furniture in-house. We buy our doors from Tecnoform and we have some very good European suppliers and long term relationships with those people, and they help us in our design.

Aboutcamp BtoB: In Europe and USA, brands are merging in to Groups, but why is this not happening in Australia?
Gerry Ryan: We have had the opportunity to buy other brands. We believe that with one strong brand, Jayco, we have different models, and I think that if you’ve got your sales team focusing on one product you will have more success. It’s been proven that this model has worked for us.

Aboutcamp BtoB: Is there a dream or vision you were not able to reach?
Gerry Ryan: The race is not finished. I am involved with a few sports, from rugby to horse racing and basketball; people always ask me: “what’s the difference between sport and business?” Well, in business there’s no finish line, because you’ve got to keep improving. At least in a game or a race, you finish, but in business you’ve got to be 24/7, because as soon as you improve, the competition improves. It’s not about the big will beat the small, it’s the fast that beat the slow. People say to me, “What’s the best product you’ve ever built?”, and I say: “it’s the next one.”

Aboutcamp BtoB: You are involved in a lot of activities (rugby, RV factories, cycling team, winery, and you are in the show business). Which is the most fascinating to you?
Gerry Ryan: Caravans. I have been very fortunate as I love the people, love the product. I still get enjoyment walking out in the factory, talking to people, checking out the bins and asking questions. A word I use is “why?” – Why do we do that this way? Why are customers buying the competitor’s product?

Aboutcamp BtoB: Tell me about your activities in supporting people and charities.
Gerry Ryan: I came from a very humble background and my mother always taught me to look after someone in a worse position than you, or more in need, so it’s been our philosophy that we are going to look after the community because that’s where our employees and our customers come from. I think all companies have a social responsibility to the community, and it’s always been a priority for us from across the board, from youth in need, to sport and medical research. Each year, we put a certain amount of our profits back in to these charities.