From restructure to revival amidst market challenges

Bold decisions and some leaps of faith have carried post-driver manufacturer FENCEQUIP through tough times in recent years.

Based north of Auckland, the highly regarded company underwent a complete restructure following the economic downturn brought on by the COVID pandemic hangover and has come out the other side winning.

The company, founded by Troy Knudsen, came about from a lifetime of work and experience in the fencing, engineering, manufacturing and motorsport industries.

“(This) combined with a growing demand for a new driver in the market was where I could merge my experience of post driver manufacturing with my fencing experience and knowledge of high strength materials from the motorsport industry,” he told WIRED Magazine.

In the early days, it was just Troy with a few friends helping out for short periods of time. But it soon grew to two to three full-time staff.

“Then, before we knew it, we were at 8 to 10 staff.”

FENCEQUIP began with its flagship post driver, the HD (heavy duty), before more recently, into the MD (medium duty). It also produces HD skid steer drivers for the US Market.

There were plans to make an economy model, the LD (light duty).

“However, we got a name for high-end machines, so we didn’t end up with that much demand for a light driver.”

But there was growing demand for an even larger driver.

“So, we made a SHD (Super Heavy Duty) that was designed for orchard and vineyard work.”

This was followed by its pile drivers for excavators and telescopic range, and more recently, the skid steer specific machines for the North American market.

“We have dabbled in a range of other products and attachments, but I am finding it’s better to be really good at a few things than be okay at a lot of things.”

FENCEQUIP ran for several years with a core group of six highly-trained staff with a few contractors and seasonal staff. At the time, it was an extremely hard time to get labour, Troy said.

In April 2022, they lost three of the core team of six in one day, with one moving to another trade and another moving to another local engineer, giving just a day’s notice.

The third crashed their motorbike on their way home, breaking their femur and wrist. This is where things got tricky, Troy said.

“We tried to rehire and get our staff numbers back up, but it proved very difficult rebuilding the team as the three core staff left now had to take on other people’s work, as well as help train any new staff where we could find them.

“It’s hard on a team environment when there are multiple people that need training, let alone the personality clashes you get.”

This caused another of the core to leave at the end of 2022.

At the same time, FENCEQUIP was a continuously growing in size, product range and sales.

And then in December 2022, the New Zealand market dried up almost overnight.

“We went from selling one to two machines a week on average to one in six months,” Troy said.

They were fortunate to get some export orders over this period, as well as finishing machines on back order due to reduced productivity from running with a less experienced crew.

“Unfortunately, we had to let some of the newer staff go. This was one of the hardest things I have ever done, letting good staff go because I couldn’t sell enough to secure their job. It’s hard enough letting someone go for disciplinary reasons, but this was much harder.

“Obviously, I was not alone with this, as a lot of our New Zealand customers were experiencing similar things.”

In a lucky break, a contact in the USA reached out, giving the company a new market to focus on.

“It wasn’t as simple as sending what we already made. It was a new market with different ground and different needs. Getting the drivers right for the USA was not going to happen overnight.”

But, with the local market quiet, Troy was able to focus on getting the new product right.

“Every container load we sent was different from the last. Not only did we continually improve the performance of the product, we also tried to simplify the manufacturing process as well as the packaging process.”

But just as the team felt they were back on their feet, other cracks began to form.

The cost of living was rising, and staff were needing more pay.

“We also still had a large workshop with only four staff, so our costs per machine had risen dramatically.”

And with a soft market, it didn’t feel possible to raise prices to cover this.

So, in early 2024, Troy made the decision to dramatically restructure the business.

The lease to the factory in town was released and the business moved to Troy’s home. The company went from working out of 700m2 to 200m2, and from four staff to one.

But the move has proved to be the right one.

“Now that we had refined our product and manufacturing processes, we no longer needed to raise our prices or have a large team to get machines out the door.”

It was then that the New Zealand market “turned back on”, along with the US market starting to take off.

“We now have enough work to keep 10 people busy, so we are once again changing how we do things,” Troy said.

Manual labour tasks are outsourced, and the team focuses only on doing the automation and highly technical parts and assembly, in order to keep complete control over the quality of the product.

Parts are sold on the website store to give Troy more time on the tools.

“We are also looking to try and implement lean manufacturing and focus on continual improvement of not only the product but also our processes and workspace.

Although the New Zealand market has come back, Troy feels it has changed.

“A lot of people are having to change how they work and sometimes where they work and with a different machine setup.

“It feels like what worked yesterday does not work today in business.”

Troy shares his story with many customers about what the company did to survive in the hopes it will help others.

He has also helped a number of contractors sell their specific setup and either buy another customer’s setup or re-invest in a new piece of equipment that better suits the current type of work.

“It’s definitely a mixed bag out there, but if you are willing to change and roll with the punches there is always a way through.

“We are looking forward to this new growth cycle and how we can grow to meet demand in a completely different way to last time.”

Article by Rosa Watson