Hard-asset company brimming with intangible assets

General manager Greg Jolly from Tuapeka Gold Print is excited about the growth of the company> PHOTO: Gregor Richardson

Tuapeka chief executive Greg Jolly had to push back on the sceptical comments from his chairman when he decided to question the company’s intangible assets.

With folded arms, the chairman wondered aloud if the time spent on uncovering the hidden value in the business was worth the hassle.

But Jolly saw exactly how the insights would benefit the entire firm.

He countered that the analysis meant they now knew which of the many intangible assets peppered across Tuapeka could generate the best ROI and how to get the business in the best possible condition to attract buyers – should the company ever wish to sell or attract investment.

“That interaction with the chairman was quite interesting because it was like a light bulb went off in his head and he suddenly went, ‘oh yeah, that’s right!’”

“Looking at our company through an intangible assets lens made its value much clearer and helped us to articulate that value. The deeper we got into this project, the more we saw why it was important,” Jolly said.

The chairman’s scepticism was understandable, particularly in such a tangible asset-heavy sector.

Tuapeka is a large promotional manufacturing company based in the South Island of New Zealand. Its secret sauce is its promise to get any decent-sized order of branded promotional items to a customer within five days and it has been enormously successful with this strategy.

Tuapeka is owned by two major shareholders, both of whom help run different parts of the company – the operational end and the customer-facing side. This executive team has shepherded the company from $28 million in turnover in 2019 to an impressive $109 million in 2023.

That sort of growth was an excellent problem to have: how to keep delivering on its competitive edge of turnaround speed, without compromising on quality. As the company raced ahead with growth, it was outpacing its foundational strategy and needed to think differently if it was to continue on its trajectory.

Jolly and his management team realised that scaling the business would require a different approach to managing its operations. While they had some suspicions as to which of their intangible assets were important, they were unsure how those assets could enhance the company’s dynamism and truly underpin its value.

Having been referred to EverEdge, Tuapeka engaged the firm to conduct a strategy and valuation project.

“When EverEdge’s analyst walked into our factory, the first things he saw were a series of LCD screens displaying manufacturing data. He also noticed that the precise layout of the machinery was designed to achieve maximum efficiency for the workers who all had deep industry expertise not only in the normal course of business but also in troubleshooting issues.

“Beyond this, he also saw the importance of our IT software, which governs the operations of all our machinery, and the opportunities it presented for us to further leverage and boost equity in our brand.

“As he explained that we were surrounded by intangible assets, I started to understand. Seeing all our intangible assets laid out like that was really impressive. Then as we continued to dive into the assets that were more commoditised, it certainly showed us exactly where to invest,” Jolly said.

Jolly added although that Tuapeka continues to be run like it will never be sold, knowing the true value of the business will give them more confidence should they ever consider selling, not to mention allowing the team to keep the business in a state of being “sales-ready.”   

“Now that the blinkers are off, we have a much better understanding of our intangible assets and how they drive value. EverEdge’s insights really helped us on this journey and we’ll definitely continue to leverage their expertise as we aim for the moon,” Jolly said.

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