I was very lucky some 6 months ago to meet this amazing Manufacturing Entrepreneur by the name of Michael Mourad from Pace Pallet Services.
As part of being on the Board of the Cumberland Business Chamber (which is an Industrial Business Chamber based in Sydney’s West) – we started working on some shared projects and I was very lucky to get involved in his business and see his amazing operation and success first hand.
If you have been keeping abreast of Australian News lately – it won’t take much reading of the papers or flicking through TV Channels to see that Manufacturing in our country is most certainly on the decline across the board. Car Manufacturers, Speciality Manufacturers and even Steel to name a few – there isn’t a lot of good news in this regard.
Michael’s business has been growing and as part of our combined mission and work with Cumberland Chamber – we have been helping to tell the “Manufacturers Story” to get the right message to government in relation to the challenges, sentiments, barriers and support required for manufacturing to turn a positive corner in our fine country. In addition to capturing Michael’s thoughts in this interview, I was also lucky to learn his story – of how he came to be and the thinking that has led to his amazing success.
Listen to his interview below and feel free to read the transcript.
Many great thanks from Edward Zia – Marketing Mentor and Developer of the Awesome Marketing Vault
Edward Zia: Hello everyone this is Edward Zia here and I’m sitting here with the amazing Michael Mourad from Pace Pallet Services. Say hello to the audience Michael.
Michael Mourad: Hello everybody.
Edward Zia: This is a very interesting interview, a very important character I work with. Michael Mourad is an amazing entrepreneur from a company called Pace Pallet Services. If you’re from Sydney, he’s got a factory based in Wetherill Park and he manufactures pallets for big, big companies and custom designs pallets. He’s an amazing entrepreneur with how many staff have you got, full time staff?
Michael Mourad: We’ve got about a dozen people here Ed.
Edward Zia: Dozen people, full on entrepreneur. He has built a manufacturing business in Australia from scratch that is growing today. That’s quite a rare thing in today’s economy. I think, got several reasons for interviewing Michael today. A – I want to hear his amazing story but B – love to hear his views on what manufacturing is doing in Australia and what can be done to improve it. So, Michael this is your show. How did you get here, how did you build such a successful business Michael?
Michael Mourad: Thanks for the introduction Ed. We started business back in 1998 and started out as a part time business operating out of a garage at home.
Edward Zia: Operating out of a garage?
Michael Mourad: Operating out of a garage, yeah. It’s a similar story to many businesses around the world.
Edward Zia: Bill Gates, I think, started in a garage didn’t he?
Michael Mourad: Yeah, I believe he did. We basically started out as a transport company providing pallet collection services. From there we slowly evolved into providing the collection and repair services. We thought, well if we’re going to repair pallets why can’t we manufacture brand new ones. We then got into manufacturing, manufacturing custom pallets. It’s been a gradual evolution ever since. Since we started we’ve seen steady growth and that growth is continuing today. We’re not seeing massive growth but it’s been steady and stable growth. The view I’ve always had is, if we pick up a new account let’s do it well, let’s do it right, let’s make sure it’s profitable, move on to the next one. It’s been a formula that’s worked so far.
Edward Zia: I was going to say, when did you start this business?
Michael Mourad: Originally started providing transport services since 1998. We actually officially came together and formed Pace Pallet Services in 2001 as a company. Part of that was a couple of different partnerships that were working together. Since 2001, as I said it was a steady growth. We purchased a factory unit then we rented a second one, we leased the yard. We’ve now moved premises again. So Yeah, as I said, smooth, slow, steady growth.
Edward Zia: So you went from the Bill Gates story of working in a garage to having this massive, awesome factory now.
Michael Mourad: I wouldn’t say it’s massive but it’s definitely a step forward. I’d call it a medium size factory. A perfect fit for basically where we’re heading at the moment. We pick up a few major accounts along the way and hopefully a few more to come before we pick up and go up to the next level of warehouse.
Edward Zia: I was going to say, you don’t have to blow your details, but you’ve got some pretty prestigious clients that you work with.
Michael Mourad: Absolutely Ed. We believe strongly in forming partnerships with our clients. Whether it be a small, owner-operated business or a small multi-national, our view is, as we get in there, it’s no secret we need to make profit. It’s no secret our customer has to save a dollar. We go in there with the attitude to work together and quiet often with an open book, which we’ve done, in an effort to come up with the best solution. It’s worked well for us so far. We’re not going to claim to be the cheapest in the market, we’re not going to claim to be the most expensive, we claim to be the fairest and most honest. Trying to have a level of integrity in the way we do business and it’s been a successful formula so far.
Edward Zia: It’s amazing. Let’s go back a little big, let’s go a bit back in time. If you’re not from Sydney, Wetherill Park is, I suppose west of Sydney, this is one of the major industrial zones of Australia, isn’t it?
Michael Mourad: Absolutely. I believe it’s the largest industrial area in Australia. I find it quite central to the Sydney metro, that’s who we primarily service, the Sydney metro area. I’ve also grown up in the area.
Edward Zia: I was going to say tell us, what’s it like growing up in the industrial heartland of Australia.
Michael Mourad: I’ve always felt very connected with this area. I’ve gone to school. The school I used to go to was actually right in the heart of the Wetherill Park industrial area. It’s no longer a school anymore. We used to go across the road and pick up scrap timber from the local window factory and actually build cubby houses. Wetherill Park looked a little different then, but it’s certainly been quiet an experience as a child.
Edward Zia: So as a school child, I can’t imagine that today that you’d go to the factory and pick up bits of timber and play with them. That sounds like a law suit by today’s standards, Michael.
Michael Mourad: Yeah, well I’m still doing it today. We’re still picking up bits of timber and making things out of it.
Edward Zia: Except you’re making money this time.
Michael Mourad: There you go.
Edward Zia: That’s amazing. So what happened to you, you went to high school? What’d you do after high school?
Michael Mourad: After high school I actually wanted to pursue a career in computer programming strangely enough. Not many people know this. I actually went and got a diploma in computer programming.
Edward Zia: You got a diploma, didn’t know that.
Michael Mourad: No, no that’s right. I really enjoyed problem solving and I wanted to have a career in computer programming. But once I completed my diploma, I realized that I couldn’t see myself spending all my time behind the screen solving problems all day. I wanted to solve problems away from the computer screen. That’s when I got into business. I had a few different jobs. I was a [store man 07:29] and packer for a while. I was a dispatch clerk, I was a transport manager, a production manager, a materials manager.
Edward Zia: So you’ve worked your way right up the blue collar high rocket.
Michael Mourad: Absolutely. Operations management, general management, now director of my own company.
Edward Zia: So you were a general manager? What did you do there, that’s a pretty prestigious role?
Michael Mourad: Yeah, I call it general manager within my own business.
Edward Zia: Ah, got it, got it.
Michael Mourad: Yeah, In the corporate field I’ve got as high as an operations manager. Basically looking out for factories, and logistics, and transport.
Edward Zia: How many staff did you have under you at one point? That was a pretty prestigious role that you had.
Michael Mourad: The most I had was just over 50 staff in my corporate career. That’s a thing of the past; you still have challenges, you still have stakeholders to please. The challenge now is really trying to satisfy our own demand and move quickly to make sure that we meet our objectives.
Edward Zia: Absolutely. I was going to say what made you decide to leave the corporate world and go into your own business, and build this amazing business that you have today?
Michael Mourad: I guess it was a number of things. As I mentioned in 1998 the business was in its infancy. I was actually doing it as a part-time job on the weekends. The birth of the business . . .
Edward Zia: You were a naughty moon lighter, weren’t you?
Michael Mourad: Actually came about prior to me leaving the corporate world. As I said, it was a slow evolution but at the time, when I went full time into it, it was a logical thing to do.
Edward Zia: So you went out, you started up with your family. Just so I know, every time I visit here, you hide your whole family. Who are your family members who work here as staff?
Michael Mourad: We’ve got three equal shareholders between my dad, and my brother, and myself. We are quite active in the business and I think any family business, you need to be clear on what your roles and responsibilities are. We’ve clearly defined them early, we work well together, we look after our own area of responsibility. We sometimes have to tread on each others toes.
Edward Zia: But you’ve been doing that your whole life so it’s OK, right?
Michael Mourad: It’s OK. We all find a way to figure things out and, if we have to step on toes in somebody else’s area for the benefit of the business we do it. As long as we’re all seeking the same goal it all works out well in the end.
Edward Zia: Love it. I suppose the big thing that obviously that brings us out, especially this point and time, is that we’ve been together working on the shared project with Cumberland Business Chamber.
Michael Mourad: Yes.
Edward Zia: At this time, we are both on the board of Cumberland Business Chamber, Michael Mourad and myself. Really the Cumberland Business Chamber is about building business in the western industrial heartland.
Michael Mourad: Yes.
Edward Zia: I imagine manufacturing costs in Australia, you know we’ve had the recent closure of car plants, SPC case going on at the moment, at the time we do this. Manufacturing in Australia, you wouldn’t say it’s a positive picture isn’t it?
Michael Mourad: No, it’s of great concern. Especially to companies like mine which form partnerships with larger manufacturers. It’s very concerning to see how many of my manufacturing customers have decided to shut shop. It’s too expensive, labor, etc., it’s too expensive to produce in Australia. Let’s shut shop, let’s send it overseas, and we’ll just be a sales and distribution business in Australia. I’ve seen it happen over and over again. We still get the pallet business, but it’s sad to see those clients opt now for an imported version. We’re losing all that skill, all that expertise in Australia for it to go overseas. It just concerns me. I don’t know what the solution is, but it concerns me greatly what the future of manufacturing in Australia is going to be like. Here I am working very hard for many years to build our humble family business. What will the face of manufacturing be for my children? What is the future? I’m hearing a lot of distressing stories from my clients, the cost of energy, cost of labor, the red tape. The manufacturing is all over the headlines but what is being done?
Being a small to medium business owner, it’s very easy to be so focused on your own business, head down, keeping an eye on the bottom line, trying to keep your head above water, and then venturing outside of that comfort zone dealing with the bigger issues. You generally don’t have time for that. I’ve been in that boat. Joining the Cumberland Business Chamber has given me an opportunity to get my head out of my own business and do that little bit more. Yes it eats into my personal time but it’s what you do to actually see. If there are more businesses like me that would just do that little bit extra, to get out of your own space, and see if we can tackle the bigger issues, and have a voice. I feel the local business chamber is the right place for that because it is local. I know there are other, larger organizations but I feel that the Cumberland Business Chamber was the right choice for us. To have a local voice and this is our first opportunity to actually get out there and see if we can make a difference.
Edward Zia: It sounds amazing. You’ve identified a few issues as being increasing energy costs, some of your clients are going overseas. In short, what do you see as the big challenges to Australian manufacturers?
Michael Mourad: Ed I think everybody’s talking about efficiency. You can only get so efficient. If you’re running your margins tight, and you’re running your overheads tight, and you’re as efficient as you can be, you might be able to squeeze a little bit more here and there but you’ve got no where to go. You’ve got nowhere to go with your margin because I can’t increase my price. You’ve got nowhere to go with your overheads because I’ve squeezed my overheads already. There’s nowhere to go. More efficiency, if you’ve done your best to get as efficient as you can, where do you go? There’s nowhere else to go. You can’t tweak, “I’m going to up my price.” It’s difficult enough to be competitive as it is. It’s something I don’t know the answer to.
Edward Zia: So you’re up against pressures of again, you can only charge so much, or you just want to get those big deals. There are certain costs that are on the rise. I guess you’re being squeezed from the top line and also your bottom line. I think it is a big issue because obviously a lot of Australian manufacturers have felt that pinch. Just putting it out there again where, obviously this is an apolitical interview, as much as I support the Liberal Party, it is an apolitical interview and I think it’s fair to say. I’m a member of the liberal party. But it’s also fair to say that both side of politics have not adequately addressed the concerns of manufacturers. I think anyone would agree on that. And being, a big supporter of the liberal party, I’m the first to say my own party needs to work on that. What do you think both sides of politics and the government should really be doing to help the situation?
Michael Mourad: Ed I don’t have a solution, I’ll be honest with you. I’m one of these people that’s been caught up in my own world and, in recent times, I’m starting to stick my head out and get more active at a higher level. But it would be nice if both sides of government could listen to the masses and understand what the issues are. If energy is hurting a particular industry, well why can’t we have the cheapest energy in the world? Why does energy have to be so expensive and so heavily taxed? Our industrial relations laws. There’s some industries that are doing extremely well in terms of their salary packages. Is that sustainable? What’s in the better interest of the nation? Sustainable industry or let’s get the best for our staff today? It needs a balance. It can’t be too far on either side. I don’t have a solution, all I can say is I would like to see more businesses like myself get out of our comfort zone, and out of our spaces. It can be very difficult when you’re fighting to maintain a bottom line and it is a fight sometimes. I totally sympathize with that, but if more businesses like mine could get out and actually get active, and make a contribution instead of whinging to themselves and amongst themselves, actually get out there and voice their opinion. Join your local chamber, join the Cumberland Business Chamber, and actually speak up, get involved. We’re actually hosting an upcoming manufacturers forum. This is the first time I’ve attempted anything like this in my business. I’d welcome any size manufacturer to actually come out and introduce themselves and voice some of these concerns. At the Cumberland Business Chamber is well connected. If you want to get a message to the right people, this is certainly the forum to do that.
Edward Zia: I think you’ve touched on a very good point there Michael. It’s one thing to bitch to your buddies and it might be stress relieving at that moment, but what actual good does it do in informing government on what needs to be done. I think it’s a very fair comment. Again as I said, I’m not hiding this, I’m a member of the liberal party but I say this as well. I’m in the media today, we can see both sides of politics pointing fingers at each other as to where the car manufacturing industry has gone. Not one of them has stepped forward and said, “Where did we go wrong 20 years ago?” I know we’ve sort of spoken about this. Maybe if we pick on the car manufacturing industry for the moment, you would agree to the fact they did not go broke yesterday. They started going broke what, 20 years ago?
Michael Mourad: I think we lost the car manufacturing industry a long time ago. It’s too far down the track. The car manufacturing industry is really just the final assembly of a car in Australia. How much of a car is really Australian?
Edward Zia: I want to know, tell us.
Michael Mourad: I wouldn’t know either. But you buy an engine from this country, you buy these components from another country, you buy these bits and pieces, and we have a factory in Australia which does the final assembly, it’s Australian made. I think we need to go right back to the raw material. We’re quite happy to be digging dirt out of the ground and basically put on a ship. Is that what we are? A country that’s only good for digging up dirt out of the ground? I think we need to look at all the value adding processes of smelting that metal or whatever the raw material is, and then value adding it into the down line manufacturing process. Then it may turn into a car or into a fridge, or an air conditioner, or whatever it might be. If our government can help us go right down the line and follow that value add processes all the way through, then I think there’s some real opportunity for Australia. It’s too easy just to dig out a bit of dirt, put it on a ship, send it away, and then we buy a car from somewhere else. It’s just too easy.
Edward Zia: And obviously any logical person when hearing the facts presented in that light, you shake your head. It just doesn’t stack up to any form of economic rationalism, doesn’t it?
Michael Mourad: Absolutely not. I’m a small business owner, again, trying to keep my head above water like many others. I don’t have the answers, but I would love to see the brainpower that we have in the country come together, put your ideas on the table, and let’s give the government some real meat as to how to help the manufacturing industry in Australia.
Edward Zia: Michael I think that sounds great and I think this discussion has been very compelling and really understanding. I suppose the concern of a successful manufacturer like yourself, and obviously you’re not like a wing nut or anything on the edge, you’re not like a fringe character here. You’re obviously speaking the voice of the masses and only one needs to visit the ABC News website or pick up a paper to see the state of disarray that the Australian manufacturing industry is in.
Michael Mourad: Absolutely.
Edward Zia: Michael, this has been a great interview. I’m going to say this has been very, very good content. It’s been amazing not only hearing the story but also the challenges that we have to contend with. I was going to say anything you want to close on with the audience? Any bit of advice that you give to people in your position, any compelling tidbits?
Michael Mourad: Ed I guess if there’s one thing I could share. I like to conduct my life and my business following a few simple rules. I have these rules in my notes on my phone which I sometimes look back just to remind myself on how I want to conduct myself in life. I wouldn’t mind sharing it with your self.
Edward Zia: I’d love to hear it and the whole world’s going to hear it.
Michael Mourad: My first rule, enjoy life. So regardless of whether it’s personal or business, we need to enjoy life. Let’s not forget that.
Edward Zia: Love it.
Michael Mourad: My family always comes first.
Edward Zia: Brilliant.
Michael Mourad: Be present. Take care of my health. Work hard and play hard. Have integrity in the way I conduct myself and my business. Communicate, communicate, communicate. Foster creativity and ideas. Use a planned and structured method for managing my business. Grow and develop my staff. Trust and respect those who have earned it. Make the tough decisions. Reward performance and results. Challenge myself and the things I don’t agree with. Do not accept mediocrity. Be positive. That’s it.
Edward Zia: That’s amazing, I think we should swap jobs. It’s amazing. You know one thing I like from that, I love the bit about mediocrity. Obviously, you being the successful man you are today, is a result of you not accepting mediocrity.
Michael Mourad: No.
Edward Zia: I mean, not many people, let’s say, come from a working class background in this part of town to build such an amazing business like you have.
Michael Mourad: Ed, if there’s anything left, you can be as motivated and as positive as you like but at the end of the day, you just got to be committed to it. Motivation peaks and troughs, as our energy does. You just have to remain committed to it. That’s what I’ve done, it’s a consistent commitment. Not giving up, working through the tough times and the good times. You’ll be there. We’re still here, we plan to be here for a long time further. I hope I’ve imparted some of my life lessons anyway.
Edward Zia: Michael it’s been an amazing interview. Thank you very much and I think it’s very interesting. Obviously we’ve got to tell the government what’s going on so both sides, both the left and right of politics can come in and help us. Some very, very good lessons to close on, commitment is everything.
Michael Mourad: Absolutely.
Edward Zia: Michael on behalf of Edward Zia’s small business marketing mental, thank you for the amazing interview.