CASE STUDY – NZ Distribution Limited
NZ Distribution Limited is one of New Zealand’s successful distributors of auto parts to franchisees across the country. Colin Rawhiti and his wife Freda originally owned an auto-shop in Central Auckland. As their operations grew, they realized the potential and started up NZ Distribution Limited in 2004 using venture capital, and have realized a good profit for each year that they have been in business.
Last year NZ Distribution turned $2 million in profit from a sale of $10 million with over 80 franchisees in the North Island and 20 franchisees in the South Island.
NZ Distribution purchased a warehouse in Penrose, Auckland, and have used it as a central distribution point to serve their customers. As most of their business is centered in the North Island, they manage the company operations out of Auckland in an office above the warehouse.
The company expanded to Christchurch in the South Island in 2006 as a result of a study carried out by Companies Research Group in 2005. The study aimed at evaluating expansion of the company to the South Island.
The South Island operation was initially a small distribution centre, distributing products to franchisees. Business has been so successful that in June 2006 they opened a regional office and distribution centre in a small warehouse in Christchurch, where they receive bulk packaged products from Auckland by plane. The objective is to provide three times weekly delivery service to all customers. This has been successful in the North Island so they are trying to ensure the same service to the Christchurch area.
Packaged products (auto parts packaged ready for selling) are dispensed from Auckland and Christchurch after receiving emails or phone calls from the franchisees. The North Island products are prepared in the preparation shed next to the warehouse in Auckland. The company has a fleet of six cars and four vans on the road six days a week in the North Island, and two cars and a large van for local deliveries around Christchurch.
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