Global links not world away

As Jan Van Mossevelde stands in his socks in the homestead of a high country station delivering a presentation via his laptop hooked up to the family television, it is evident this is no ordinary business meeting.

Mr Van Mossevelde is global president of merino brands Icebreaker and Smartwool, both owned by US-based apparel and footwear giant VF Corporation whose revenue last year was listed as around $US11.6 billion ($NZ19.2b).

Smartwool was founded in 1994 in Steamboat Springs, Colorado, by ski instructors Peter and Patty Duke, while Icebreaker was founded a year later by 24-year-old Jeremy Moon.

Icebreaker famously put New Zealand fine wool on the world map — it was the first in the world to develop a merino layering system — and it became one of the New Zealand Merino Company’s anchor markets.

In 2017, Icebreaker was sold to VF Corporation, which also owns such brands as The North Face, Vans and Timberland, in a deal which was later revealed to be worth $288 million.

At that time, Mr Moon said the deal was a "once in a lifetime opportunity" for both the company and New Zealand wool suppliers.

In a recent interview with the University of Otago, the master’s of commerce graduate said he had three objectives with Icebreaker: to build an international brand from New Zealand; to offer customers a natural choice in an age of synthetics; and to have an impact on the outdoor industry.

"The reason ultimately I sold it to VF Corporation was for two reasons. Firstly, I’d achieved those objectives — I’d been doing it for over 20 years. Secondly, they owned a lot of outdoor brands such as North Face and Timberland and they wanted to use the ideas to apply natural technology to their other brands, and I thought ‘wow what an amazing opportunity to scale the idea and have more impact’, which goes back to the purpose of the business. Everything aligned and the time was right," Mr Moon said.

While Mr Van Mossevelde said his trip to New Zealand was officially labelled a business trip, it was "anything but" and it felt very much like coming home.

Prior to flying home on Sunday, he had met close to 100 growers in a week, as well as representatives from NZM which remained a key strategic partner.

It was difficult to describe those meetings with growers, which often involved kicking off his shoes at the door and a discussion over a cup of coffee at the kitchen table as the next generation of potential growers were running around.

During a visit last year during school holidays, growers were encouraged to bring their children, and entertainment, including a clown, was organised to amuse them.

It was interactions like that which made the industry unique.

"It makes the product so much more than a purchase."

The grower community were hardworking people who were not driven by reaching 65 and retiring. It was a generational business and he enjoyed meeting the young generations, sometimes offering career advice and perspective of what it was like in business.

NZM chief customer officer Dave Maslen said that connection to growers was what attracted brands to the model.

"I can’t think of any other industry in the world where you’ve got retail brands in direct contact with their tier 4 raw material supplier. To know ... the first name of their grower suppliers is literally unheard of."

Mr Van Mossevelde said the relationship transcended how many bales of wool a grower could supply — "we do that for dessert", he quipped.

Given what had been happening in the world in the past couple of years, brands were "struggling really hard". At Icebreaker, they were being realistic — "cautious is a good word" — but, looking forward, it was beyond optimism.

"There’s confidence all underlying drivers for merino and Icebreaker as a brand are extremely healthy," he said.

Post-Covid, there were accelerated requests for outdoor products, which created almost a bubble effect in the category. Now it was almost a category correction but it was considered temporary.

Merino was a growing search trend and increasingly consumers were looking into what merino was and what its benefits were.

In China, Icebreaker was VF Corporation’s fastest-growing brand and there was growing interest from Chinese consumers for premium-quality fibre sourced with provenance.

Mr Maslen said NZM now had a new three-year contract for 15.5 micron wool, in response to demand in Asian markets for softer-feel garments made from natural fibres.

In 2017, Icebreaker signed the longest ever supply contract with New Zealand wool growers, which NZM said was worth $100 million over 10 years.