What is it with garden sheds? Put a good keen Kiwi in one, and they have an uncanny habit of coming up with a successful business while tinkering away in the dark and musty confines.

So it was with Doug Rankin. Back in 1977, the former Broadcasting Corporation engineer began banging about in his garden shed producing industrial electronics products. It was in the days of protectionism, when we had to find our own solutions because we couldn’t buy them in, and his first project involved making a cycle timer for a friend’s injection moulding company. He called the backyard business Actronic, not just for the obvious link to the word ‘electronic’, says the company’s chief technology officer Paul Corder, but also because the A would put it up front in the Yellow Pages. Practical sorts, these Kiwi blokes.

Rankin was joined in the business by his former Broadcasting Corporation colleague Bob Allison, and Actronic soon forged a reputation as a little company that could solve problems.

Almost 30 years on, the garden shed’s still around (at Doug’s brother’s place, Corder reports) but Actronic has clearly outgrown it. Actronic is now a multimillion-dollar business that employs about 76 staff and gets 95% of its business from offshore. Rankin and Allison remain on the company’s board and are still among its shareholders, says Actronic CEO Mark Templeton, but the company’s largest shareholder is now Lionel Rogers, one of the original funders of Navman.

The company is a world leader in supplying mobile weighing and measuring equipment for rugged environments, such as the quarrying and mining industries. Marketed under the brand Loadrite, the company’s core product has essentially been a weighing solution that attaches to a wheel loader, allowing material to be accurately weighed as it’s loaded onto trucks. This helps avoid inefficiency through under loading, or fines through overloading.

Under another brand, Logrite, the company also produces electronic controllers for forestry harvesting equipment, which are marketed by Tokoroa-based Waratah Forestry Attachments.

But back to that garden shed. Over the years, Actronic developed a huge range of industrial products, including everything from instrumentation on early America’s Cup boats, to medical equipment, to a good deal of industrial weighing equipment.

But ironically, when the company first developed the wheel loader scale it wasn’t seen as a major source of future business. So in 1979, its worldwide distribution rights “were negotiated, given away just about”, says Templeton, to a company in Tauranga, which became known as Loadrite Ltd.

There was a growing realisation, however, that Loadrite was where Actronic’s future lay and that the company needed to get closer to distributors and end customers if it was to grow, says Templeton. So in 2004 Actronic finally bought the Loadrite distribution rights back.

“You’ve got a company that’s 30 years old and for 27 of those years was really a traditional New Zealand manufacturing/exporting, manufacturing/design house,” he says. “But in the last three years it has transformed itself — or is in the process of transforming itself — into an international marketing company that designs products to meet end-user requirements.”

And transform it has, by setting off on an ambitious growth path. In the past four years the company has doubled revenue, which is now just under $20 million, and plans to be a $50 million company by 2011 and turn over $100 million by 2015. The Loadrite business has been growing at about 20% annually and Templeton reckons ramping that up to about 25%, along with a few well-planned acquisitions, will enable Actronic to reach the $50 million target.

Dealing directly with distributors has boosted margins and revenue. It’s also helped the company consolidate and strengthen the distributor network that Templeton says has been a key to Loadrite’s success.

The company’s direct competitors are generally regionally focused Europe-based companies that rely on sales agents. But Loadrite’s distributors not only sell the product, but install, service and support it as well. “It means they have very strong relationships with their local customers,” he says. “That gives us an edge, and in the case of North America it’s probably the reason why we’re the dominant player in that market.”

Jim Gondor, owner of US-based K&R Weighing Systems, was Loadrite’s number-one distributor in terms of sales volume last year and has seen an improvement since dealing directly with Actronic.

“They see the value of the distributorship that they’ve built and that’s what’s important to us — that they see our value and we maintain good value for them,” Gondor says.

Future growth is being driven on three fronts and the first is developing new products. The company has redefined its core business, says Templeton, and now pitches itself as a provider of “productivity solutions for difficult environments”.

The traditional Loadrite product clearly sits within that frame. But Actronic has also invested heavily in developing new products — -particularly advanced, communications-based productivity tools — which are now coming out the pipeline (and, for now, marketed under the Loadrite banner). One such tool currently under trial in the US and due for release in August, for example, is able to combine weighing information from several loaders with information about trucks coming on to a site, so a quarry can monitor the overall efficiency and movement of materials through the site. Says Actronic chief technology officer Paul Corder: “The Loadrite product has always been about productivity. It’s just stretching that further and further, and picking up all the opportunities we can.”

Secondly, the company is expanding its geographic markets. The company has 55 distributors in more than 30 markets and is investing heavily in in-market support. The US is the company’s biggest market, accounting for 55% of revenue, and last year it opened a US office through New Zealand Trade and Enterprise’s Beachheads programme. Templeton says the prime value of being involved with the Beachheads has been networking, and building relationships with those active in the company’s field — or related fields — in the US market.

The company also plans to open an office in China (where it has a partnership with multinational weighing company Mettler Toledo) in June and the Netherlands in July. South Africa and China, says Templeton, are the company’s fastest growing markets.

Developing new industry sectors is the third area of growth. The company has previously concentrated on mining and quarrying, but is increasingly exploring opportunities in other rugged environments, including the forestry and waste industries.

About 18 months ago, amidst so much strategic change, the company also went through a Better by Design audit, a process which evaluates every aspect of the business from a design perspective. Corder says the audit has had a broad impact, from helping increase product design focus on end-user requirements and usability, to introducing strategic design advisors who contribute to the business on an ongoing basis.

The company has outgrown its Penrose base and is about to move into new premises in Avondale, where design has also been carefully considered.

Unlike its former “rabbit warren” offices, says Corder, the new premises will be open plan to encourage the free flow of communication. There will be dedicated product display spaces, a cafeteria, and whiz-bang technology, such as screens linked to webcams in offshore offices. In a company with an increasing global spread, it’s hoped they’ll help keep everyone in the loop while scattered around the globe.

Now that’s something you won’t see in a garden shed.