The first question asked by anyone interested in the history of MACVAD Ltd is “where did the name come from?”
In the 1950's the New Zealand international trading environment was quite different to today's unregulated free for all. Companies wishing to trade overseas needed to make applications to the reserve bank for foreign funds to make payments. To purchase a new car you needed to have foreign exchange and then go on to a waiting list. If one wished to travel overseas it was necessary to seek approval from the reserve bank to obtain to travellers cheques from the trading Banks in order to travel. Nearly all imports were tightly regulated to ensure protection for New Zealand industries and then we were all still tied to Mother Britain for most of our imports and exports.
In 1950 Peter McClune was 20 years old and working in Wellington for William McDonald & Co. (His earlier efforts to find satisfying employment as a teacher proved to be a non-success.) William McDonald & Co. was a Family owned firm established by Bill McDonald in the 1920's as a manufacturer’s agent representing a number of UK leading textile companies, including WM Clark and Sons est. 1776 in Northern Ireland. Peter was employed to look after sales in the South Island. Peter would leave Wellington on the overnight ferry to Christchurch arriving early in the morning with suitcases full of samples and walk around the buyers all day and then return to Wellington on the evening ferry. Subsequently this became 2 days, then 3, then a week with side trips to Dunedin.
During the 1950's William McDonald & Co. also opened an office in Auckland run by Peter Quiney but it was not a success, Don McDonald (Bill McDonald's son) subsequently came to Auckland but did not fare much better. In fact William McDonald & Co. made no profit from the Auckland office in the 1950's. Doug McDonald was running the Wellington office.
In the late 1950's the world was changing. Japan, Hong Kong, India and Malaysia were all producing “new” textiles and opportunities in the Far East were opening.
In 1961 Peter was offered a transfer to the Auckland office with the brief to make a profit and develop the Far East. Peter, his wife Val, and 4 kids moved to Auckland. Two more children including the baby of the family Andy (current Director) would arrive later.
Peter’s first trip to the Far East was a 3 month trip from April 1962. In May 1962 while in Japan, Peter met a group of Australian's including Reg Urquart (of R D Urquart a household textile importer) and Mark Voyage (of A G Voyage) who had recently attended the Canton fair in China.
From this meeting a great friendship developed with Reg Urquart. Peter subsequently received a number of names of contacts in China and correspondence was started directly with the China National Native Produce Import and Export Corporation, Shanghai Arts and Crafts Branch. Some Business resulted in tea towels and during 1961 and 1962 this grew and expanded to a 2nd Branch in China - China National Native Produce Import and Export Corporation, Peking Arts and Crafts Branch.
Late in the 1950's others were also getting starts in China. Ron Howell was also establishing connections in China and was selling New Zealand Wool with some success. The Chinese however at that stage did not have too much in the way of foreign cash reserves and were looking to promote exports sales.
Ron Howell has a Son DAVid. Take the first 3 letters of David's name, and reverse them you have the start of the name of Ron's Company VADco Traders Ltd.
In early 1963 Ron held discussions in China where he was pressured to start reciprocal trade with China by purchasing product from China as well as selling wool. The end result of this discussion resulted in Vadco Traders securing a sole agency from China National Native Produce Import and Export Corporation.
William McDonald & Co. subsequently received letters to this effect from both China National Native Produce Import and Export Corporation and Vadco Traders.
Unfortunately, Ron did not know much about textiles and could see his aspirations to develop the Chinese potential not growing. At this stage Ron approached the companies which had been trading Chinese textiles in NZ and offered them sub agencies to on sell textiles on behalf of Vadco Traders with a split commission arrangement. Most companies decided not to do anything and wait for the agency to falter. William McDonald & Co. however took a different view and looked at the potential of China as an opportunity to have a point of difference from the many other textiles agencies. William McDonald & Co. started a dialogue, which lead to an agreement to sell on behalf of Vadco Traders and split the commission 3% WMD / 2%VT. William McDonald & Co. was corresponding directly with China and Vadco Traders were copied on all correspondence.
The situation was now relatively stable with business growing, but from the Chinese point of view it looked messy. Further discussions took place between William McDonald & Co. and Vadco Traders and a new company McDonald Vadco Ltd was created solely for the promotion and sale of goods from the People’s Republic of China.
Peter McClune was appointed General Manager and the business was established in Auckland where more and more of the textile businesses were locating their buying offices.
Peter was in charge of Sales, and Ron was in charge of the office.
Ron Howell was a difficult man to work alongside. He was a strong Methodist with temperate views, an Accountant, a socialist during a period in history where this could be difficult. However he was very well organized. The filing system developed by Ron Howell for McDonald Vadco right at the start was so good that 30 years later it was used as the basis for Bounty (the in-house computer system.)
In the early years Peter was assisted by his right hand man Alan Moyes. Alan did not travel and if my memory is correct did not drink Lion Red (he was a DB man.) McDonald Vadco was based in Elliot Street.
The Book Keeper was Dom Keys, the Office Manager Bert Rhodes, and a couple of smart Salesmen in Warren Hodge and Ron Kay.
Peter started regular travel to China. With no diplomatic relations in NZ it was necessary to travel to Hong Kong and apply for a Visa. (Today we could do this in 24 hours.) Then; Auckland – Sydney – Darwin – Manila – Hong Kong (Buggered) Recovery in Hong Kong required at least a week while waiting for a Visa to China and then it was a full day trip to cross the only entry point into China at Lowu and travel to Canton. Your passport was taken from you during your stay in China and only returned on your departure once the train had departed Canton for Lowu. Travel permits were required for travel between cities in China and many cities were off limits for foreigners.
To fly from Canton (Guangzhou) to Shanghai was an effort. Canton – Changsha – Wuhan – Hangzhou – Shanghai was about 8 hours on a good day and 3 days on a bad run. Flights were infrequent and best avoided if possible. The train was the best method of transport as it is today although there were some seriously slow trips;
Serious eating was also required. It was not unusual for 3 banquets in a day (breakfast, lunch and dinner.) Our Chinese hosts were always with us, with one host travelling with Peter to the next city to deliver him to the next host. Serious discussions always occurred. Invariably it was the perennial problem of late delivery, never price problems and rarely quality problems.
Most of the time, it was only possible for 2 meetings each day. The morning meeting would start at 9.00am with political speeches extolling the virtues of China and the Party which might end at 10.30am followed by a brief discussion concerning textiles and NZ. At 11 am it would be off to Lunch for a 10 – 12 course banquet, then back to the Hotel for a short rest before heading off to the next appointment in the afternoon at 2 pm. Another reinforcement of the virtues of the local systems was again followed by a brief discussion on Silk fabric for NZ. At 4.30 the meeting would finish and Peter would be off for the evening meal. This would be another 10 – 12 course meal hosted by the Manager of the afternoon appointment. (Is it any wonder Peter took a liking to smoking and drinking, as they were an excuse to stop eating!)
These meals were hugely important as it was where the real business took place. Relationships were formed and problems were raised. Generally at each meal there would be Peter, The Boss of the Corporation, the Head of the Department hosting the meeting, the day to day Businessman, the Interpreter, the Party Boss, the Driver and somebody the boss would be trying to impress like the local customs man or banker (wheels within wheels.)
McDonald Vadco had used the slogan “solely dealing with products from the People’s Republic of China” to great effect and had secured sole agencies for;
Each of these corporations had a head office in Beijing and branches in Shanghai, Nanjing, Hangzhou, Tianjin, Dalian, Guangzhou, Qingdao and a few other cities.
It was a top down structure with all decisions concerning price and allocation being made in Beijing, with provincial and city structures below following head office directives to supply.
Peter’s management of these initial relationships through extremely difficult times in the early years cannot be underestimated. Trading in China during the “cultural revolution” was not an easy task and I suspect one which very few traders in the world experienced.
At this stage McDonald Vadco in the late 1960's was doing a lot of business in Australia. Offices had been opened in Sydney and Ron Kay was the 1st Sydney Manager. Business was difficult however and the office was shut 2 years later.
Around about 1968 the New Zealand Market also started to change. Import licences on many categories of product had consolidated into the hands of a few Companies. Now, selling product not only required good relations with suppliers, but also good relations with import licence holders.
In an effort to secure the long term future of McDonald Vadco, Peter McClune started discussions with Wales and Mackinlay with a view to bringing then on as shareholders. This resulted in new shareholding being a third each (William McDonald & Co. / Wales and Mackinlay / Vadco Traders)
The effect of this arrangement enabled stable sales and ongoing growth
A number of other changes also started to occur with staff. In about 1972 Des MacDonald (different spelling for McDonald Vadco) joined the staff. Des had a wonderful attitude to visiting China. He loved the people and his bubbling personality assisted in breaking down a lot of doors. This was also the year New Zealand and China established formal diplomatic relations.
Around 1978 New Zealand was also starting a period of change. Infant garments were exempt of tariff and import control. This enabled McDonald Vadco to establish a garment department. Graham Gummer was the initial manager and gave a start into garments and home textile products.
Ron Howell had also exited by this stage and Peter McClune gained a 20% shareholding in the Company.
Many changes also started in China. Late in 1978 the decision to establish the Shenzhen special economic zone started a process of investment in China. Initially this was very slow but over the next 10 years Hong Kong Chinese started to slowly to return to China to invest in factories and infrastructure. This led to an explosion of opportunities which really enabled McDonald Vadco to grow.
In 1979 Rob McClune joined McDonald Vadco. At that time MACVAD was based on the corner of Union Street and Nelson Street. From memory we had 10 staff including Peter McClune, Des MacDonald, Graham Gummer, Rob McClune, Dawn Howe, Diane Finlay, Dom Keys, Garth Sawyer and Rod Hebden. We were still only involved in selling fabric and infant Garments and a few home textiles.
In 1982 The Warehouse Ltd was established.
1983 was the start of a wave of trade delegations visiting New Zealand. The delegations were a mixture of government, provincial, municipal and company interests and arrived in New Zealand en masse. Some weeks we had in excess of 10 delegations. Most groups tended to have only 1 or 2 members who worked, the rest were observers, party officials, bankers or officials needing buttering up by the leader of the delegation. These delegations were difficult to manage. Pick up from the airport and sightseeing was mandatory, as was entertainment. At this stage it was a 7 day a week operation for all staff with the company ford station wagons the vehicle of choice (where 5 trade group members plus driver and 5 bags could be accommodated).
In 1984 the NZ government started a process of relaxation of import controls and import tariff reduction. Exchange rates were freely floated, government subsidies for agricultural products were eliminated and restrictions on wages interest rates and prices were removed. Open trade was created with many industries changing overnight. Many garment makers closed. Garment importers were created. Light industrial products like furniture, cups & saucers, tents, bikes etc. could be imported. McDonald Vadco was the right company at the right time.
We already had a special relationship in China and were in a position to take advantages of the huge changes in China's capabilities to make products to the standard our market needed. We had buyers in New Zealand with no knowledge of China wanting to buy and we had the supply channel in place. It was like the stars all aligned. A trade fair in Wellington where McDonald Vadco received a sizeable quantity of trade licences to import goods from China enabled a relationship to be established with The Warehouse.
The Warehouse also grew and around 1990 became large enough to be a force in the discount market and to look to China to source product on a regular basis.
New Zealand was also seeing the start of the second great wave of Chinese migration to New Zealand (the first being the 1880 gold rush in Otago.) One of the quietest immigrants to New Zealand was Miss Zhou Min who arrived at McDonald Vadco the day after arriving in New Zealand with a letter of introduction from one of our old friends in China recommending Miss Zhou as a hard worker. We were lucky and Mrs Theresa Zhou is still with us today, and yes she does work hard.
Graeme Heaphy had joined McDonald Vadco in 1985 and a visit to China in 1993 with Neil Plummer of The Warehouse set off a change in the fortunes of both The Warehouse and McDonald Vadco. The trust and understanding between Graeme and Neil enabled a huge expansion of business.
Changes were also afoot at McDonald Vadco. In 1986 Doug McDonald was retiring from William McDonald and as such a hand shake agreement with Peter McClune led to an alteration in shareholding.
1992 saw further consolidation of shareholding into the hands of working Directors with the buyout of Wales and Mackinlay’s shareholding and the appointment of Rob McClune and Graeme Heaphy as Directors.
Through all the changes of shareholdings and the many changes on government tax policy McDonald Vadco had received great advice from Graham Brown. Graham was our Company secretary for more than 20 years and knew the company inside and out. His advice and practical management assistance kept all Directors on the straight and narrow and was a huge influence in focusing us all on McDonald Vadco and the future.
During the 1990s the Garment division continued to grow and flourish initially under the guidance of Rob McClune, then from 1992, Scott Gibson, and from 1995, Greg Pool. Also joining the McDonald Vadco team in 1995 was Struan Kingan who together with Graeme Heaphy quickly expanded the Light Industrial division.
The capabilities and variety of manufactures in China was quickly increasing and at the same time there was huge growth and demand from what was becoming a major customer, The Warehouse. T shirts, Snuggle Sacks, bicycles, baskets, Power tools and the ubiquitous garden gnomes were just a handful of the products in demand and McDonald Vadco had the systems to not only find them but make it easy to buy them.
Rob McClune and Graeme Heaphy continued to expand the product offer and supplier base and this momentum continued with Struan Kingan, Greg Pool and Andy McClune (who joined during 1996) taking up a shareholding and driving sales in Hard-goods, Garments and Home Textiles. Andy the youngest son of Peter and Val McClune brought his logistics ability and quickly learnt the home textiles side of the business.
In an Interview with Struan Kingan (dressed in a suit) and Graeme Heaphy (dressed in Trackie pants) Graeme had explained what the role is for McDonald Vadco. Struan was heard to say "Is that all you do???" - He later admitted to being very wrong.
At the end of the decade McDonald Vadco was occupying a two storey office building in Spring Street and was experiencing growth in all areas except for textile piece goods. A reduction in local manufacturing saw the sales of bulk fabric decline and after nearly 30 years selling fabric MacDonald Vadco closed the Textile division passing customers on to Domino Textiles in Christchurch.
In the year 2000 The Warehouse entered the Australian market through the purchase of a discount chain called Crazy Clint’s and Silly Solly’s. McDonald Vadco established relationships with the Australian buying team for the newly named The Warehouse Australia and provided good support from across the Tasman. Early 2001 saw Jason Tolley come on board to help Struan Kingan consolidate and grow the business in Australia.
Towards the end of 2002 it was becoming difficult to grow with The Warehouse Australia any further without being on the ground in Sydney. In February 2003 Jason Tolley moved to Sydney and McDonald Vadco opened an Australian office for the 2nd time in its history.
2003 also saw a move from our Auckland home in Spring Street to a larger space at the top end of the Newton gulley. This was also the year a "keen young Man" joined the team called Sharl Short as an Account Manager.
Also in late 2003 Hamish Miller and Melanie Ballard joined the team on the same day, Mel promptly flew off to a Trade Fair and Hamish went to work in China; working on factory inspections. Both went on to manage successful division of MACVAD.
2004 saw the company change its name officially from McDonald Vadco to MACVAD. This was the abbreviated name used most frequently by suppliers and clients alike. This name change also removed the confusion for our suppliers about what, and who, our company actually was - often new suppliers thought we were respresentatives of the large American burger chain with the famour "golden arches" logo - we always responded by saying McDonald Vadco was much bigger than that company! While the name was shortened the red band with the gold strip remained as part of the logo.
2004 was also the year in which MACVAD began working with clients in both the Canadian and South African markets. In tandem with Australia and NZ MACVAD was really beginning to spread its wings. MACVAD Australia moved offices from North Parramatta to Newington.
The following year a support office was established in Hangzhou, China. This has continued to grow over the years and is now 25 people strong supporting our teams around the globe with admin services, QC and QA services, factory audits and some sourcing capability.
2005 also saw the establishment of an in-house design team. This team has provided MACVAD with a significant point of difference in all of our markets- we have been able to generate top quality packaging and design options for our clientele at a fraction of the cost charged by an external design studio. Curently this team has staff in NZ, Australia, UK, USA and Canada so provide 24/7 service.
In 2007 MACVAD Group acquired Tynan Textiles. The company name was changed to TYTEX and the focus was on sourcing and supplying commercial textiles. TYTEX continues to evolve and provides warehousing and contract logistics services to the Group as well as branching into product categories such as medical disposables that it distributes through its established health industry channels. Aaron Nye headed this up with Benjamin Taylor then taking over managing it.
In 2008 MACVAD acquired TOPLINE MARKETING, a national NZ merchandising company. TOPLINE MARKETING compliments MACVAD’s core business being able to assist in the in-store merchandising of its lines. TOPLINE MARKETING has built a strong presence in NZ supermarkets and a great portfolio of brands that it represents in those channels.
In 2009 MACVAD again moved headquarters to the current location in Birkenhead on Auckland’s North Shore. This year also saw the establishment of ARREDO as a company within the MACVAD Group providing expertise in furniture to many of NZ and Australia’s large furniture retailers. Managed by Gerry Watkinson who has been a big player in the furniture market for many year.s
As MACVAD’s business with ALDI Stores in Australia grew, we were introduced to ALDI buyers in the UK. For all of 2009 and half of 2010 Emma Dever serviced this growing account from the other side of the world in Australia. By August 2010 an office was needed in the UK - we found a home on the northern edge of London in Borehamwood. The end of 2010 also signalled an office move for MACVAD Australia to Camperdown, just on the western fringe of the Sydney CBD.
2011 saw the opening of a South African office based in Johannesburg to support the burgeoning business relationships that were being driven by Guido Lorenzini in that region. Sharl Short has done the large trip many times back to his homeland to help support this team.
2012 saw MACVAD open an overseas office for the 3rd year in a row and the 5th time in the last 9 years- this time in Toronto, Canada Led by Hamish Miller from NZ, MACVAD's business had reached a level where a local presence was needed.
In 2013 MACVAD UK team moved to bigger offices as they were bursting at the sides.
2015 MACVAD China moved to stand alone offices in Hangzhou, the team had out grown it's curent office. Neil and Janet McGillivray spent 4 years away from New Zealand living in China helping to develop his great team,
Over the past 9 years MACVAD has truly become a global player- the Group has provided retail support for customers in NZ, Australia, England, Ireland, the USA, South Africa, Canada, Thailand, Austria, Hungary, Slovenia and Switzerland. The MACVAD team is 175 people strong now and is spread across 7 countries meaning we are working almost completely round the clock!
Along the way the scope of business and services provided has grown enormously beyond straight out sourcing- for example, MACVAD provides large wholesale services, warranty & service lines in 5 countries and innovative packaging and design options. While MACVAD has always strived to improve its offer, we have been very well supported over the years by a number of key buyers and suppliers alike.
MACVAD Group is very well placed to continue to grow in a global marketplace that is very different from the one it started in 50 years ago. While the marketplace has changed in that time, the underlying business practices thatMACVAD applies to its clients and suppliers have not changed at all and will continue to underpin the next 50 years.
There is one person who greatly contributed to the success of MACVAD but was never employed. Val McClune is Peters Wife of 60 years. Married in 5th July 1952 Val has been the strength and determination behind Peter. Val and Peter had 6 children (all angels to be sure but probably a bit of a handful from time to time.) With Peter away for up to 3 months at a time in the early days, the care of the family fell to Val. Later when the trade group arrived en masse, Val was the driver of the second tour car and also head chef for Devonshire teas and later extended her skills to 6 and 8 course Chinese meals for up to 10 people. Quite remarkable! For Peter, his greatest joys in watching the success of MACVAD has been the pleasure of having Val with him by his side. It would not have happen without Val.
As told by Rob McClune, Jason Tolley & Andy McClune