Our History – JAS Oceania

There’s an old saying that if you fail to plan, you plan to fail. JAS Oceania was several months in the planning, and years in expansion into a market already well serviced, the enterprise didn’t fail, it kept growing. Even before the doors opened, JAS Oceania was evolving into something broader than the original concept the founders planned.

JAS Oceania is a trade supplier, selling to specialised auto electrical and air conditioning workshops. The company was the brainchild of three auto industry stalwarts: Nick Hollings who retired in April, 2017; 52 year old Steve Douglas, who is marketing and product manager; and, 53 year old Graham Bonney who takes care of distribution and sales.

In their time, the three men have been involved in a management buyout, three takeovers and a start-up business. All three men were senior executives at Ingram Corporation where they worked for more than 15 years. Nick and Steve had been shareholders in Ingram following a management buyout from Amcor in 1993.

Nick was CEO of Ingram from 1994 to 2000. Steve and Graham have had parallel careers. Steve did an apprenticeship as an auto electrician in Adelaide with two companies: Wood Auto Electrics and Smith Auto Electrics, before starting with Ingram in Adelaide in 1989. Graham, also an auto electrician, served his time in his father’s business, Bonney’s Auto Electrical before going to work for Ingram in Adelaide in 1991.

Steve worked at Ingram in Adelaide for 18 months, then in Melbourne for 18 months and returned to Melbourne to work full time in 1994 as marketing manager.

Graham was Ingram’s Adelaide branch manager for three years before moving to Melbourne in 1996 to take up the position of national sales manager.

Graham said that in those days Ingram mainly employed auto electricians as branch managers and sales reps: “They knew the product, and it was a specialised product. All electrical repairs were done by electrical workshops; our products weren’t sold to mechanics.”

Steve said Ingram Corporation is now Ashdown Ingram and owned by US based Genuine Parts Company (Repco) after being sold to Repco in 2004.

“In early 2005 the three of us got together and started hatching the idea of starting a business,” Graham explained. “We were looking for an equity partner, which at the time was Natrad.”

Natrad has a history in the auto service business, specialising in radiators and air conditioning.

Graham said when JAS Oceania opened for business in 2005 it was a 50-50 partnership between the three partners and Natrad. “Seven months later Natrad was bought out by Adrad Group, a national radiator supply company,” he said.

“When Natrad was bought out, we purchased the company’s 50 per cent holding and then in 2006 a fourth person, Bob Daley, former chief financial officer at Natrad, came into the ownership of the business as a substantial shareholder.”

“The original concept of JAS was to build the business around what we called Japanese alternators and starters product range,” Steve Douglas said. “We added the name Oceania, so we could get registered. There was already a JAS Australia”

“And as we started the business we had a lot of suppliers come to us, so we decided to go into a full range of auto electrical. We then made a starter motor, alternator program, a lighting program, and accessories program and an air conditioning program.”

“The three of us spent three or four months working on product and getting product available, because obviously with overseas product there is lead time,” Steve said.

The business started off September 2005 in a 1000sq.m building in Western Avenue, Tullamarine.

 “I think 14 or 15 people resigned from Ingram on the same day, and these were people we had approached and knew from our Ingram days,” Steve said. “I mean, all of us had worked at Ingram.”

JAS launched in Melbourne, Adelaide and Brisbane in November 2005. Six months later it had opened in Perth, Cairns, Rockhampton and Sydney.

“We opened two or three branches in late 2005, and at that time we had some blokes we employed without a branch,” Steve said. “They were just running around servicing customers.”

JAS opened its ninth branch in Darwin in May, 2007 and branch number 10 in Albury in June 2007. And despite the Global Financial Crisis of 2008, JAS was not affected, achieving 10 per cent sales growth through that period.

Steve said people were holding onto their cars a bit longer through the GFC: “At the end of the day it’s like food; everyone needs their car and you’ve still got to keep them on the road.

“And because our products are breakdown products, and if they’re not working your car doesn’t run so you’ve got to get them fixed.”

In 2008, Newcastle based Coast and Country, started by ex-Ingram employees, was bought and turned it into a JAS Oceania branch in 2009. A Canberra branch was opened in 2008, a second Melbourne site (2011), and a second Brisbane site (2011).

In 2011, JAS acquired AAEW, an auto electrical rebuilder based in Adelaide. AAEW is run as an independent business even though it was part of JAS Oceania. The same year, JAS opened a second branch in Brisbane North, and started an export department.

In 2012, JAS bought a small Gold Coast auto electrical business, W&S Automotive, opened a Dubbo (NSW) branch and became distributor of Robert Bosch Products and LV Automotive Brand Release.

In 2013, the JAS Brisbane South operation was relocated to a 1000sq.m warehouse, the next year the Perth branch was also relocated to a larger warehouse and the company launched eJAS, its online ordering system.

Hellaby Holdings made an approach to buy the business in 2014. “The deal went through in June 2015 and we became part of Hellaby Automotive,” Graham said.

“We hadn’t thought about selling the business, but Hellaby came to us with an offer that was suitable at the time.”

When Hellaby took over, everyone had to sell their shares and Bob Daley retired.

Steve said Bob was a silent shareholder who didn’t come into the office on a regular basis, but he was a big supporter, especially in their early days when they needed cash.

“And most of the branch managers who sold are still with us,” Steve said.

“It was tough for the first few years because we were ploughing the profits back into the business to help our expansion, so dividend repayments were only minimal for the first four or five years.

“And before Hellaby, the business kept growing and we had difficulty keeping the growth going by bank fund.

“You know what banks are like? Every time you sign a document they want you to sign it 20 more times every time you go for more finance.”

Steve said they wanted to keep growing the business, but bank debt was going to be difficult.

“We kept getting the bank debt higher and higher, and that it made us nervous,” he said.

“Plus we had some smaller shareholders. About 11 of them, some senior guys here and nine branch managers. The three of us had hit our fifties and we were looking at succession planning, but there was no-one coming through.

“No family and no younger guys coming through, so it was an opportunity to sell that business and give opportunities to others.

“Hellaby had an automotive division and in Australia it included Diesel Distributors and Federal Batteries. Then they bought us, and then they bought PAT (Premier Auto Trade).

“In late 2016, Bapcor took over Hellaby, and we became part of Bapcor.”

JAS Oceania had 17 branches when Hellaby took over, and opened another four branches under Hellaby. Since Bapcor took control, the company has opened branches at Tamworth NSW, Bunbury and Wangarra in WA.

Not surprisingly, JAS Oceania’s main competitor is Ashdown Ingram which has about 50 or so branches. But JAS is catching up, having expanded to 25 branches and employing a 170 staff and still growing.

Interviewed June 2018