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Wool Stocktake : Annual Report 2006-07
9 Australian Wool Innovation Limited 2006/07 CEO’S REpORT Australian Wo ol Innovation is an organisation that has changed dramatically in the past year, and it will continue to change in order to meet the challenges of increasing the worldwide demand for Merino wool. It’s an exciting time to be in the wool industry. And over the next few years we have an exceptional chance to inﬂuence textile businesses and apparel retailers around the world. AWI is now in a unique position to offer coordinated support right through the supply chain for all our business partners. Our company can and will offer sound market research, innovative solutions and strong marketing support around the world. AWI has decided to divide our resources in a fresh way, with 60 per cent going to the apparel product development and marketing area and 40 per cent to on-farm research and development. That’s a major change, but one that is clearly required in today’s marketplace. I’m pleased to say it is a strategy that has been strongly and formally endorsed by our shareholders, Australia’s woolgrowers. Farmers can see the direct, tangible beneﬁts of our new direction. Those beneﬁts will be ampliﬁed in the months ahead with the merger of AWI and Australian Wo ol Services, and the consolidation of direct business relationships with Wo olm a rk licensees. That will allow us to offer business propositions of even better value to partners around the globe. But the Chairman and I are also determined to stay focused on the innovations farmers need to do their work productively, proﬁtably and in an environmentally friendly manner. Just one example demonstrates how seriously we take that job. AWI, its Australian wool industry partners and the Australian government have, through the Land, Wate r & Wo ol program, invested $40 million improving xhow wool growing businesses work with their natural environment. As a result, more than 4,000 Australian growers have trialled and demonstrated land management practices on their farms and some 19,000 farmers have accessed information that will help them in further protecting Australia’s unique natural environment – an environment that produces the world’s ﬁnest Merino wool. This is the future, in an increasingly ecologically aware global marketplace. Consumer trends will also drive our research at AWI in order to provide fabrics, garments and innovations that address the demands of people who buy clothes. We need to build our global networks to ensure that business partners get innovative solutions to meet their customers’ needs and get the help they need to move new products speedily to market. We ’ r e committed to providing business services of an exceptional standard, promptly and efﬁciently. But we have to stay on our toes. Our competitors, and there are lots of them these days, are starting to pay more attention to wool and to the innovations that are making wool an increasingly hot property in the world of garments and fashion. Our competitors continue to innovate, often trying to mimic some of the best qualities of wool and the new generation of wool fabrics that our researchers have developed. We have seen new synthetics, for example, that attempt to replicate the active moisture management properties that wool inherently possesses. These include super-absorbent plastics derived from plant products, capable of taking in many times their own weight in water. And there are new synthetics impersonating wool’s active thermal management attributes that allow clothing to adjust to the temperature outside. To hold our price up and maintain our position in the apparel market, we need to beat all competitors on product innovation and on customer relationships. The 200 year anniversary initiative has been a great example of the way we operate. It is the biggest global marketing program AWI has ever undertaken. This is not only about celebrating our proud heritage, but also about showing what we have to offer our business partners for the future. The new AWI has shown over the past year what it is capable of and where it wants to go. I am absolutely certain that our dedicated and talented teams, in Australia and in major cities around the world, can continue to deliver tangible results for our shareholders. Craig Welsh Chief Executive Ofﬁcer, Australian Wo ol Innovation 20 September 2007
AWI Annual Report 2007-08