SALVAGING AN ICON

Written on the 9 May 2011

SALVAGING AN ICON

IT was two years ago this month when one of Australia’s iconic luxury yacht brands started to sink. Debt-laden and forced to jettison its workforce from 1200 to 400, Riviera was in dire straits. Now after a rise from administration, the boat builder is just ‘months away’ from exiting receivership. CEO John Anderson tells Gold Coast Business News that the dramas of 2009 are now behind the company.

Give us an introspective on Riviera’s rise from administration?

The last two years have been extremely challenging for the entire marine industry, in fact Riviera fared better than a number of its global competitors. The US and European markets in particular were gutted, in some cases segments were off up to 75 per cent. I am not sure I would use the term ‘gallant’ in regards to exiting administration but more of a common belief that Riviera was strong enough to overcome these obstacles and continue in business. This was a crucial point in all of our suppliers agreeing to the terms of the deed of company arrangement (DOCA). The return of a healthy Riviera was the best overall outcome for all concerned.

The company is still in the hands of receivers; what’s next?

The vast majority of the tasks needed to be completed for Riviera to exit receivership have been completed. First and foremost we had to rebuild the senior management team and I am pleased that task has been accomplished with the hiring of Darren Wallace as our general manager of global sales. The team that is in place today is extremely experienced in their respective positions and bring a wealth of business acumen to the company. My estimate is that we are now just months away from exiting receivership.

How difficult has this period been for you personally as people questioned the longevity and strength of the Riviera brand?

Having experienced a corporate bankruptcy in my past I knew first hand that a strong brand with good people, dealers and loyal customers can not only survive, but grow to be a larger stronger company in due course. I will admit that the first few weeks leading up to the Sanctuary Cove International Boat Show (2009) there was some level of anxiety. This ended after the first few minutes of the show when our display filled with loyal Riviera owners showing their support and having sold 5000 of the ‘I love Riv’ stickers.

There was never any doubt in any of our minds that Riviera wouldn’t recover. The proof of the strength of the brand has been confirmed over the last two years based on the number of new Riviera’s that have sold.

What are your thoughts on where the industry is heading?

Over the last year we have had the return of the 50ft and larger market and this trend is continuing. We are currently on our capacity plan to reduce the cycle time on our lines for larger boats to improve our delivery dates.
We see considerable sales activity with our 58 Sport Yacht, 61 Fly Bridge and we have a 70ft in build at the moment. This is combined with a number of 43 fly bridges and our 53 fly bridge that will be introduced at the Sanctuary Cove show this month. I believe that the 50ft and above sector will continue to be active as there still is substantial inventory of under 50ft product around the world.

How problematic has the strong Aussie dollar been for export operations?

Call it brilliant thinking or perhaps luck, but not knowing how long the GFC would be a factor in the marketplace we have been very conservative in our forecasting for the export market.
We have had a plan in place for some months in regard to operating at parity with the US dollar and now we would just like to get back to that level. I am not clever enough to forecast exactly when we will get back to parity or below, it’s just something you have to manage your way trough.

What’s the key leadership mantra you bring to Riviera and what corporate strategy will drive the brand forward from here?

My management style has always been to surround myself with smart people and let them do their job and of course making sure everyone is aligned with the common goal. We have a defined growth strategy but it can be broken down into simpler terms. Make sure you know what the customer wants to buy and you have a distribution network that can sell and service the product. The rest is up to the company to make the right decisions and with the team that is assembled at Riviera today I am extremely confident in the future direction of our company.


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