Australia’s last mill standing

Cheap imports have pulled the rug out from under Australia's textile manufacturing businesses, but one family firm found a way to thrive.

If you’re working into your nineties running a family business that you want to stay in the family after you’ve gone, then you’d better have interested grandchildren. Your children have probably lost interest and retired, or died, before you.

Not that it’s always necessary (or even possible) to skip a generation. Prince Charles has now hit retirement age waiting to inherit the Windsor family business, but inherit it he will and young William, Duke of Cambridge, will have to wait his turn.

In the case of Creswick Woollen Mills, a slightly less prominent family firm located just outside Ballarat in the pretty hamlet of Creswick, a generation was indeed skipped. Eric Herszfeld, the only stepson of founder Paul Ryzowy, wasn’t waiting, like Prince Charles, for his turn. He was happy with his own importing business. 

Graph for Australia’s last mill standing

Which is just as well. Paul ran the firm till he was 92, before handing over to his grandson, Boaz Herszfeld. When he passed away six years ago aged 96, his will left the business 75 per cent to Boaz and 25 per cent to his sister Sharon.

Boaz, now 40, had started working for Creswick Woollen Mills when he was 24, although he started nagging his grandfather for a job as soon as he turned 18.

“Go to university,” his grandfather told him. “There’s no future in textiles.” So he did. He asked again when he finished his commerce degree. “Get a job somewhere else,” his grandfather told him. So he joined Arthur Andersen and became a chartered accountant.

And when, three years later, Paul finally relented and took his grandson into the business, it was only on the condition that he took unpaid leave from the doomed accounting firm, just in case. After all, Australia’s textile industry was in the process of shutting down following the removal of tariffs.

Six months later, Creswick Woollen Mills met its own life-or-death crisis: its largest customer, Linda Electric Blankets, went broke and as a result Australia’s last remaining woollen mill watched its turnover halve. It was 1999 and Paul Ryzowy was 88. He had owned and managed the business for 52 years.

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Paul had started Creswick Woollen Mills in 1947 after surviving the Holocaust in Poland and emigrating to Australia. In 1999 he was still doing what he had always done, making rolls of wool fabric mainly for blanket manufacturers, but when half his turnover disappeared the writing was on the wall. Unless something was done, Australia’s last woolen mill would close.

So Paul and young Boaz quickly did two things: first, they won a contract to supply the Country Fire Authority with safety blankets, which led to other government authorities and provided the volume to keep the carding and spinning lines running.

Second, they moved into consumer products for the first time, specifically, alpaca blankets.  David Jones agreed to stock them, under the Creswick brand, and it still does. Within five years they became David Jones’ largest supplier of blankets and rugs -- not just making them in Creswick but also importing them from China.

That was all Boaz. Paul hated the idea of importing material: “You can’t import,” he used to say, “they’ll send you rocks.”

And the third thing that saved the business happened by accident. In 2005, the ABC TV show Landline featured Creswick Woollen Mills in a story and suddenly they started getting hundreds of requests to visit the place and see the mill.

So they built a shop at the factory and started selling rugs and garments there. In 2005 they had 10,000 visitors; in the financial year just finished they had 90,000, and the Creswick store is their largest (out of six).

Like last week’s family business, Willie Creek Pearls, Boaz Herszfeld has saved his family business by turning it into a tourist attraction as well as a working factory. Every day they get busloads of Chinese tourists and they usually hop back into the bus carrying something made from alpaca, or fine merino wool, or perhaps possum.

Graph for Australia’s last mill standing

Sister and brother Sharon and Boaz Herszfeld

Says Boaz: “You can’t live off your legacy: you need to offer consumers what they want. In our case, it’s affordable products made from natural fibre.”

Last year the company turned over $10 million and unlike most of Australia’s manufacturers (and especially those making textiles), it’s growing. The mill still makes about 20 per cent of what the company sells in its stores and 50 per cent is imported.

Boaz and his younger sister Sharon plough 90 per cent of the cash back into the business and have done since 2002, with a single-minded determination to grow their business.

Last year they spent $550,000 upgrading and expanding the factory, of which $100,000 came from a government grant and the rest from operating cash flow. With the spirit of Paul Ryzowy still watching over them, they wouldn’t dare take on any debt.

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