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Two weeks of back-breaking construction work were almost the undoing of Christchurch businessman Dion Kerr, but they were also the genesis of his rapidly growing new company.
Kerr lost five kilos and still has the calluses on his hands from his short time spent laying foundations - but his experience highlighted the inefficiencies and poor environmental practices in building processes. Kerr spied an opportunity, and his eco-friendly foundation company Mr Box was born. The company is a finalist in this year's Sustainable 60 Awards.
"When I was on the site I noticed there was all this lost productivity. There was lots of wasted time and energy and wood that was just getting sent up to the landfill afterwards. I thought there's got to be something they could do differently."
The physically demanding job of laying foundations is one of the most loathed parts of a build, Kerr said. Traditional formwork or boxing - the frame that goes around a floor before concrete is poured - is made of non-recyclable treated timber. Assembling the boxing is slow and requires crews to use a sledge hammer to drive wooden pegs into the ground.
Kerr spent a year-and-a-half working with a design engineer to develop the patented Mr Box system which uses reusable and recyclable aluminium planks, steel pegs and clamps.
Mr Box saves crews around 25-30 hours of labour per person, per build, and reduces a lot of the hard slog involved.
Although the time gains were obvious when he took the product to market in April, Kerr was forced to rethink his business model.
"Initially we were going to hire out the system and just train people up to use it, but the market wanted us to do full foundation installations," he said.
"The hiring system didn't work because we needed consistency with the product. You would show someone how to use it and then they would leave that company and you'd have to train someone else up.
"The change has actually worked out brilliantly for our business and we have internalised those time savings and we can do more floors in a week. We've quadrupled the [turnover] we budgeted for our initial hiring model."
Creating a product that is environmentally friendly was imperative to Kerr, who had a recycling business before founding Mr Box. Around 447 to 525 tonnes of treated timber from traditional formwork is sent to New Zealand landfills each year, he said.
The company is a finalist in the marketplace and small business categories of the 2014 Sustainable 60 Awards, which recognise sustainable business excellence. The placing signals that Mr Box is heading in the right direction, Kerr said.
"We really would love to be a long legacy business. We want to prove you can have a profitable business that is sustainable and can work around those environmental issues."
Since going to market as a foundation installer in April, the company has experienced "extreme" growth. Mr Box has forecast a turnover of $3.2 million in the next 12 months.
The Sustainable Initiatives Fund (SIFT), a Canterbury-based charitable trust focused on waste minimisation, is an equity partner in the firm and Kerr said governance from SIFT has played an important role in the company's success.
"Growth is easy, but you have to be careful because all of a sudden the wheels can fall off. The board and our advisers have been really helpful.
"The Christchurch labour market is really tight so we are working hard to retain our staff and grow at a pace that's not going to make us go off track," he said.
The company is accredited for TC3 red zone constructions, which require deeper foundations. Due to its speciality in this area, Mr Box has won big contracts from Golden Homes and Benchmark Homes.
"It turns out an aluminium system is perfect for larger [concrete] pours.
"It's opened up commercial opportunities for us on big projects like supermarkets," Kerr said.
Given the difficulties some home owners are facing in the Christchurch rebuild, customer service has become critical to the company's growth.
"We're really aware that people are a bit tired of the whole process by the time they see us and little things become really important. We don't put our gear in anyone's garden and we leave our sites really, really clean."
Kerr has divided his business into two separate companies, the Mr Box Ltd business which owns the intellectual property and patents, and the Mr Box installations business which will be licensed out in different territories.
The company already has interest from potential licence partners in Auckland and a pilot is taking place in Queensland.
"A pilot is a good way to test the market and check there's the right infrastructure in place to make the business work and protect our reputation in the marketplace," Kerr said.
"We are very careful about who we work with because it's important that people understand our brand and our environmental ethos," he said.
The winners of the Sustainable 60 Awards will be announced at a ceremony on Tuesday, October 28, in Auckland. For further details and to view the full list of finalists, go to sustainable60.co.nz.
Sunday Star Times
The Christchurch rebuild will be a long slog for those putting the city back together piece by piece.
There was no shortage of opinion when Dion Kerr, director of foundation specialist Mr Box, asked builders about the most difficult part of their jobs. "We just asked the simple question, what's the hardest part of building? The same answer came up every time: laying the foundation," he says
"From there I kind of had a baseline, and a whole lot of pages of questions and opportunities."
The method of "boxing" - constructing the framework to hold a concrete foundation - is an exhausting process of cleaning, lifting, and sledgehammer swinging.
Kerr helped devise a system involving aluminium panels and a purpose-built peg-driver, which takes a lot of the grunt work out of the process.
Turning an abstract thought into a successful business was an exhausting process in itself, he says.
"Starting with an idea and going through it all was time consuming and capital consuming. And that was just to get to the prototype stage. I didn't realise how long it would actually take."
Recognition came quickly for Mr Box.
In October, it won a Sustainable 60 award - "a positive shot in the arm" - given to companies that demonstrate a commitment to sustainability.
When he started shortly after the 2011 earthquake, Kerr was a one-man band. Now he has a product, a patent, a board, an award, and 13 fulltime staff.
Kerr knows this is the part where the speed wobbles set in, so he's pausing for breath.
"We're pretty settled at the moment. We've just got to the stage where we've got good numbers and the amount of workers to cover it as well," he says.
"It's a hard one, growth. In this particular market you can get quite big quite quickly, and we've kind of done that in the last six months, so it's just time to recalibrate and look at everything."
The market is competitive. The earthquakes provided unique opportunities in the construction field, and lots of startups are jostling for space.
Mr Box has the potential to help speed up the rebuild, which is why it's doing "extremely well".
There's interest around the country and even Australia, but for the time being, Mr Box will stay local, he says.
"This is a Christchurch product. All our suppliers are Christchurch-based, that was always our aim. A lot of people like seeing that and like seeing that it was designed that way."
This isn't Kerr's first business. He's imported tiles, recycled construction waste, consulted.
He wants this to be his best.
"'We're hoping with all the effort we've put in it will be a long-term one for us.
"It wasn't that long ago where I thought I'll never do this again. But it's funny, once you've done all this hard work you've done it again."
- The Press
With his wife Michelle, Dion Kerr developed a unique system utilising aluminium panels, steel pegs, and custom-made clamps to lay foundations of buildings – providing an alternative to the traditional timber boxing model, and making light work of a very crucial part of the construction process.
Dion (who is of Te Arawa descent) can appreciate some humour in his success: “I’m the last person my family and friends would think to be near anything like a hammer and nail.”
Before they started Mr Box, Dion and Michelle had a company which recycled construction waste, reducing what was sent to land-fill. It was to be Dion’s first business experience with any environmental bent, and he was surprised to learn how much treated wood goes to the tip.
When the Christchurch earthquakes of 2010 and 2011 struck, their consulting contracts were put on hold – freeing up time to spend on their own building project already underway. In the backs of their minds Dion and Michelle wanted another business and thought they would probably buy a business.
“I asked the builders ‘what’s the hardest part of building?’, and they said it was the foundations. I wondered how then we might do this differently. Opportunity and knowledge collided and Mr Box was born.”
Mr Box won the Overall Small section of the Sustainable 60 Awards recognising sustainable business practice in 2014.
“A big benefit of entering awards like Sustainable 60 is the amount of media exposure you receive,” says Dion. “We entered a well-respected award which supports your credibility, and the business received a very in-depth evaluation.”
Dion is quick to recognise the support his business received from the Te Puni Kōkiri Māori Business Facilitation Service, when Mr Box was in its early formative stages through to its recent success.
“So to anyone with a new or established business I say – apply!” says Dion. “The process of working with the Māori Business Facilitation Service can be an early evaluation of your idea. We adjusted the Mr Box business model to offer full installation of concrete foundations. We initially were going to sell or hire the system – however we found too many variables that would need managing, like training, damage during construction or to the tools, so we decided we would install it ourselves. We will franchise that and create a larger business.”
Dion says that he received lots of advice and suggestions from the Māori Business Facilitation Service on the Mr Box website and ‘we changed it 100 percent’.
Since going to market in April and has forecast a turnover of $3.2 million for 2014/2015. . There is potential for Mr Box to further its reach nation-wide when you consider around 5000 more homes are needed in the Christchurch rebuild, a housing shortage in Auckland, and social housing needed across the country.
"We want our business to prove a legacy of sustainable business practices that are profitable too."
Check out how Mr Box works on YouTube
Learn more about Te Puni Kōkiri Māori Business Growth Support on our website at https://www.tpk.govt.nz/en/whakamahia/maori-business-growth-support/.
Photo: Fairfax NZ / The Press
