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30 Years In The Trade

By ITM

A business built on relationships

ITM's founding CEO Kevin Marevich recalls that Independent Timber Merchants was officially formed in a Kaikohe accountant's office in 1991. But Marevich's memory stretches back to 1989, relocating ITM’s baby steps to the Tikipunga Tavern, Whangarei.

Whatever, the reasons for both meetings remain the same.

“I was frustrated at how the market operated,” recalls Marevich. “It was difficult for independent merchants to sell building supplies because of monopolies on distributorships. I had an overriding sense of the lack of fairness in the industry, and was young enough, cocky enough and ignorant enough to think I could change it. I thought, let’s get a group together.”

The 1989 pub get-together was followed by a year of sweet talking and cajoling, culminating in 1991’s formal talks about creating the new company.

“[That meeting] became more and more positive, with the energy of people with a common cause,” remembers Marevich. “We had the right personalities; they were people you could like and trust, who had different skills but were very good at driving their businesses.”

Among the dozen or so present were the important figures of Lindsay Gray and Shayne Heape, already major players in Northland’s building industry.

Heape – better known in the industry as Uncle
Shayne – and Gray are still part of the ITM family.
Some crucial early members like Noble Bardell and Tony Oetgen (“He was like a second father to me,” says Marevich), have since passed on, but ITM was up and running.
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Get your brand off my TV

If Kevin Marevich painted a picture of what the business could be, his successor put a frame around it.

Gordon Buswell had been general manager of marketing at Carter Holt Harvey, and upon succeeding Marevich as CEO in 2000 he set about applying his big-business know-how to ITM.

“My view was that if I could bring the best of the corporate world – structure and strategy – and combine that with the best of what the original guys had – huge energy, a sense of ownership and entrepreneurial skills – we could get something special going.”

Buswell introduced a programme requiring stores to coordinate supply, making the previously autonomous businesses interdependent.

As an executive with serious marketing chops, it’s no surprise Buswell’s other major contribution was to develop ITM’s brand. The boss associated the company with three iconic Kiwi pastimes: rugby, motor racing and fishing. 

“Almost every builder is interested in one or all of those, and because these things are part of New Zealand, you can make an investment today and you’re still reaping rewards in 10 or 15 years.”

The strategy was wildly successful; for many the company is still synonymous with the ITM Cup, ITM Auckland SuperSprints and ITM Fishing.

“I was always on reasonable terms with my competition and the Placemakers CEO at the time said, ‘Gordon, get your brand off my TV screen.”

If ITM’s increased presence discomfited some, internally it had a unifying effect. 

“People think brands are used externally, and they are, but in a cooperative the brand is important because it makes people proud, which makes people want to support it. It’s like a flag in battle.”

Vive la Évolution

When Buswell passed the flag to Scott Duncan in 2014, the new CEO pursued evolution rather than revolution. He arrived with a reputation for systems and strategy, and saw room for greater collaboration between ITM stores.

He pushed to improve group buying practices, getting store owners to negotiate deals on a regional and national basis. Duncan also took a regional approach to marketing, and emphasised that store owners could learn a lot from each other.

Duncan saw too that ITM’s brand was now so strong that it needed less attention than it had under Buswell, and instead turned the company’s focus further towards customers.

“ITM had carved out an identity. What [my team] tried to do was identify with customers, and communicate to trade that we understand them and their needs, perhaps even better than they do themselves, and that we are the best people to look after them and make them successful.”

And it was under Duncan that the idea of store owners as shareholders was introduced. 

“I wanted to stop calling them members,” he recalls. “Members belong to a golf club; shareholders own a business”.

Boom times and beyond When current CEO Darrin Hughes entered the building in 2017, he encountered a market unlike anything anyone had ever seen. A residential building boom caused ITM’s annual turnover to tick past $1 billion, and the COVID-19 pandemic means Kiwis are upgrading their houses, in lieu of international travel.

The boom carries challenges, too, which Hughes has addressed through new technology. 

“We have 96 stores now and we’re embracing technology in a way that’s more collaborative, using it to enable all those businesses to be more effective not just in what we’re buying but in terms of how we’re operating.”

For all the 21st century gizmos, ITM remains a business built on relationships.

“Sixty or 70 percent of new homes are built by relatively small operators,” says Hughes. “Those people need to feel connected to their store, and they like the ability to have a decision made at that level. Each store is oriented around the needs of its local community, so while the industry remains as it is, there’s a place for ITM.”

Hughes recently caught up with Kevin Marevich at a conference, and the pair chatted over a beer.

“I said to him, ‘Kevin, did you ever dream what you were starting at the Tikipunga Tavern would turn into this?’ and he admitted that he didn’t. I’m impressed with their tenacity; these guys with their backs to the walls, crammed out of the market by controlled distribution and big-box players. They got together and asked how they’d solve the problem. They had rebelliousness and cunning and number-8 wire ingenuity – it’s such a brilliant Kiwi story.”