Tell us a bit about BJC Elements?
BJC Elements was founded in 1946. I joined the team in 1990 as General Manager then went on to purchase the business in 2008 after the owner passed away. BJC was founded on manufacturing heating elements for heaters, toasters etcetera. We added wiring looms and harnesses for machinery such as cherry pickers and boats later on.
One month prior to lockdown, your business transformed almost overnight. What happened?
BJC has been making specialist heating elements for Fisher & Paykel Healthcare for a while. One month prior to the New Zealand outbreak, Fisher & Paykel Healthcare flew two employees down with letters from the Chinese and New Zealand governments saying COVID-19 was expected to be bad. Fisher & Paykel Healthcare requested BJC quadruple product production from 250 units per day to 1000 immediately.
We had a dedicated team of around 10 staff who increased production to 1000. However the orders kept coming in and the numbers kept growing. We increased to 1100 units, then 1400 by August, and most recently 1600 per day in September. We employed 10 extra staff, and were still struggling to keep up with numbers. We also imported new machinery to cope, yet we were still struggling to meet capacity.
How are BJC heating elements being used to combat COVID-19?
We had all heard of this COVID-19 thing, but never thought it was going to take off like it did. The government knew it was coming to New Zealand so they were preparing.
Fisher & Paykel Healthcare were (and still are) working 24hrs 7 days per week, building humidifier appliances using our heating elements to help COVID-19 sufferers.
A simple explanation. Traditional oxygen ventilators will struggle to keep COVID-19 sufferers alive, but a ventilator with humidified oxygen (using BJC elements) helps moisture enter the lungs. The humified oxygen helps break down the COVID-19 concrete like structure within the lungs to aid recovery. Fisher & Paykel Healthcare are leaders in this technology and are shipping worldwide.
March 2020 New Zealand went into national lockdown. Have there been any hard decisions you’ve had to make?
During lockdown, although physically working to meet supply demands, I had the opportunity to drill deep into my business. Prior to lockdown, certain departments (excluding humidifier element department) were performing terribly. During lockdown I was able to drill down to look at costings. Turns out we had been undercharging for three to four years due to not reviewing our pricing from suppliers and amending pricing for our customers.
We did unfortunately make a few redundancies.
During lockdown our customers were informed of a price increase effective post lockdown. Surprisingly, we only lost one customer.
What were the benefits of these hard decisions?
Overnight, our business changed. From struggling and unable to pay the bills to very profitable. We had been under charging in some departments for nearly four years and it hadn’t been picked it up until lockdown.
What have been some of the surprisingly good things to come out of the current situation?
Profit.
And, greater understanding of where I can continue to streamline process and processes. We also underwent a restructure to ensure we had the right people in the right job.
What does the future look like for BJC Elements?
Personally, I’m looking forward to finishing what I started during lockdown and reviewing every element of our business.
I’ve taken over the day to day running of the business. At 68 years of age, I don’t want to be doing this at 70 years, but the aim is to ensure we have the right people in the right jobs, with the right systems, so I can step back.
How has working with Kendons supported you and helped?
We’ve been working with Kendons for around five years. Kendons have been fantastic. They have given me the reporting I need and trained me on how to find my own reports.
Prior to COVID-19 we were having weekly mentoring sessions on site which was very helpful. Through the lockdown we continued to meet with Michael and the team online.
It’s almost like a family relationship, I know nearly everyone by name down there. We have a joke and then get down to business. We currently have a morning check in which is helpful as things are changing quickly in our business.
How has Kendons helped with accountability?
If you’ve got your own company you are accountable to staff, and your spouse, but basically, if you have a business and it’s going along alright, you don’t tend to have someone from the outside looking over your shoulder asking you a couple of questions a week. It’s very easy to sit there and rest on your laurels.
What happens when you rest on your laurels is; you don’t optimise your business, you think, things are ok, I don’t need to make any changes. But when you have a proactive accountant like Kendons – you’ve got that someone giving you a push along – it’s quite good. It certainly keeps me looking at other opportunities both in revenue and business improvements.
As a business owner, we can’t just stop here, we’ve got these things to address. And, by addressing these things, you’ll make more profit, and do it faster.
For me, it’s good having someone I’m accountable to (in a way).
Any final word of advice Kean?
Get a good accountant. Don’t be like me and take your hands off the wheel because things are going ‘alright’. If it is your company, you drive it.
And most importantly, have some like Michael Markham from Kendons who checks in on you – “What are you doing about this / that”.
Thanks Kean, thanks for sharing your honest insights with us.
For more information about BJC Elements visit their website www.bjc.co.nz
To discuss how Kendons can help with your business, please contact us.