A REAL ICE MELTER Eski Export managing director John Gall has plenty to laugh about. His company has just signed a lucrative contract to sell ice to Danish food giant, Donicon.A small Australian company is selling ice to the Eskimos - well almost.
Corporate bean counters who still regard websites as troublesome cost centres rather than timely investments would do well to talk to Australian entrepreneur John Gall, a real-life case study in how to make money from the Internet. Gall, 54, is no direct-marketing guru or e-commerce pioneer, however. His web presence is a simple brochure-ware site sporting a few pictures of the bottled water and pre-packaged ice cubes sold by his Eski Export company - but it has been enough to pique the interest of the international packaged goods community.
It has also helped him increase turnover 20-fold and ignite a fire under the fortunes of his small privately held company headquartered in the Australian island state of Tasmania.
It all began earlier this year when a web-surfing visitor from the Danish food and beverage agent Donicon clicked on Gall's site, liked what he saw and promptly booked a flight to Hobart, the capital city of Tasmania, 30 hours' travelling time from Copenhagen.
Within days, Gall had agreed to set up a joint venture, Eski Europe, and ten container-loads of ice trays and bottled water were being readied for shipment to Europe. Within a week the size of the order had doubled as Donicon captured quick sales in Russia, Germany, Sweden and Denmark.
The unexpected deal has been a lifeline for Eski Export. Last year, six years after launching, the company had receipts of barely US$400,000. This year, the figure is expected to top US$8 million as hotels, airlines and supermarkets across Scandinavia and northern Europe sample the "world's most perfect water and drink ice".
The jewel in Eski Export's crown is Diamond Ice, a revolutionary technique of packaging fresh mountain spring water in dispensable trays containing ten cubes. The packs, sold unfrozen in supermarkets or over-the-counter liquor outlets for less than 50 cents (US) per pack of 10 cubes, harden quickly when thrown into a freezer.
Diamond Ice is aimed at discerning liquor drinkers, especially those who dislike ordinary tap ice in their premium tipple, as well as up-market hotels, restaurants and airlines, and anyone travelling to a Third World country with suspect sanitation.
Gall, managing director of Eski Export, has been singing the praises of dispensable ice to the world since the mid-1990s. It has been a trying time for staff and investors with research and development soaking up US$4 million in funds, mostly in a quest to find the optimal method of hygienically sealing water in plastic trays.
"I always knew we were on a winner, even the times when I was pulling my hair out, but being a pioneer is never easy. There was a lot of trial and error as we strove to find the best way to package the water in trays," Gall says.
As for Diamond Water, Gall admits it was an after-thought that took off: "It [the water] tasted so good and there was plenty of it so we decided to bottle it; there's a natural synergy with the ice business."
Donicon is not the first international organisation to embrace Eski Export, but it is by far the most lucrative deal for the Tasmanian company, which works with a bevy of agents and distributors in Hong Kong, Taiwan, Singapore, Japan and Mongolia. As well, the next few weeks should see the ink dry on new deals in Indonesia and Vietnam.
Even the US Army has been impressed enough to make an order for its troops after a gruelling factory inspection process of spot visits over the best part of 12 months.
The upsurge of recent interest is likely to double Eski Export's workforce to 40, a handy achievement in Tasmania where unemployment traditionally hovers above 10%. It's also a welcome relief for the existing workers who job-share tasks in management, marketing, sourcing, packaging and distribution.
And if you believe Gall, the best is yet to come. He's convinced fresh water sales are about to skyrocket worldwide, far outstripping carbonated soft drinks and flavoured drinks. To back his claim, he points to recent acquisitions and brand introductions by market leaders such as Coca-Cola in anticipation of a sales bonanza.
Gall is unfazed by big-brother competition. In fact, he is relishing the fight because he believes he is sitting on reservoirs of superior water. "We have the freshest spring water in the world. I am absolutely convinced - and these other companies will eventually learn - that there is an immense market for water that is naturally pure, not made pure through chemical processes," he says.
"Our water is filtered, but it is not chemically purified. It is a commodity that simply cannot be found anywhere else in the world."
To meet his competition head-on, Gall is planning a new bottling plant suitable for both pre-packaged ice cubes and bottled water at an estimated cost of US$300 million, dwarfing the size of the present facilities. And he may even be able to avoid taking the company public to raise the money.
"Maybe one day we will list on the stock exchange, but for now, I believe there are enough people with the vision to take a chance on this venture. Fresh water is becoming scarcer every single day and it will become immensely valuable," Gall says.
"As for ice, anyone who looks at our product and thinks it's easy to replicate should be aware that we travelled on a very steep learning curve for six years to get to this stage. Just beware, that's all I say."
Eski Export
93 Brooker Avenue, Hobart, 7000,
Tasmania, Australia
Tel: 61-3-62345577
E-mail: info@eski-ice.com
Singapore
Tel: (65) 779 2217
Fax: (65) 779 1376
Hong Kong
Tel: (852) 2827 6099
Fax: (852) 2511 5116