How Melbourne hardware firm Bowens has thrived and survived

Historic firm Bowens has been led by four generations and provides lessons on how family firms can manage the biggest generational wealth transfer in the nation’s history.

Bowens, led by John Bowens, has thrived through the depths of the pandemic. Picture: Jay Town

John Bowen was only 23 when in 1994, his father sent him to work in America.

Only 12 months earlier and less than a year out of university, John had started working at his family’s century-old Bowens timber and hardware business, which had been established by his great grandfather, Richard Bowen.

In 1894 Bowen and Redmond Pomeroy began selling timber products from a small yard in North Melbourne under the name Bowen & Pomeroy, Timber Merchants. Both tragically passed away in the same year, 1924, before Richard’s son, John senior, became managing director in 1931.

John senior’s son, Jack, took over the business in 1971. Fast forward 23 years and Jack was looking to the future, sending his eldest son abroad to work at three timber companies on the US West Coast for six months.

When his US tour of duty had ended, John junior will never forget returning to Melbourne’s Tullamarine Airport on a brisk Sunday morning, being picked up by his father and the stunning conversation that ensued.

“Dad said, ‘Do you feel like starting at our Rowville store tomorrow? I said ‘Sure’. He said, ‘Well you are the manager! I said ‘What?!’,” Bowen junior now recalls of his stunned reaction to his unexpected promotion, conscious of the responsibility of carrying on the family’s extraordinary legacy.

“I couldn’t use our prehistoric computer system, I didn’t know the staff very well and I certainly had never managed people. I was literally thrown in the deep end. But I loved it and have continued loving it since.”

Jack Bowens pictured in 2009 at North Melbourne shop.

John has now been CEO of Bowens since his father handed him the reins in 2005. His younger brother Andy rejoined the family business six years ago as chief investment officer after working as an investment banker in New York.

The fourth-generation family-owned Bowens is a market leader in supplying quality timber and building supplies throughout Melbourne and regional Victoria.

For the past 11 years Bowens has also owned Timbertruss, one of the nation’s largest prefabrication timber manufacturers which employs staff in Victoria and Queensland.

The Bowens story is also a textbook example of how to achieve a successful succession across generations in a family business and provides lessons for the family-owned firms managing the biggest generational wealth transfer in the nation’s history.

PwC has estimated $4 trillion is projected to be transitioned between generations over the next 20 years.

John Bowen says his father, who these days is Bowens chair, got the “mix exactly right” in passing the baton to his sons when he was in his early 60s. Jack’s two daughters are not involved in the business.

“I was calling him five times a day early on. Now I won’t ring him unless I have something good to tell him. He has had this great mix to exit the business and be completely positive with what I’m doing,” John says.

“He backs me in every opportunity. In fact, there are times I’ve got to ask him just to settle it down a little bit. There are other families where owners will move away and completely disappear or move away but continually interfere. Dad doesn’t do either of those things. He’s been great. My uncle David, who is also a shareholder in the businesses, has been equally supportive of me. So I’ve been very fortunate.”

Family lessons

He says his greatest learning from his father, who in his heyday famously knew the names of every staff member, was “to be honest and to engage with people beyond just the work they are doing.”

When John Bowen senior passed away in 1971, ownership of the business passed to his wife Betty, his two sons, and his daughters Carole Hart and Diana Lowe.

Two decades ago the sons purchased their sister’s shares in the business, while Betty Bowen transitioned her shares to her grandchildren.

“My dad and his sisters and brother were able to have meals and get on and speak to each other before and they haven’t missed a day of that ever since. So it’s a great lesson to understand there are other priorities apart from the family business,” Bowen says.

“I think my aunties gave a bit. But at times, the business gave a bit as well. There’s been just a different balance over time. A good transition relies on good personalities and good people who are willing to give and listen.”

The smooth transition was assisted by a board of directors established by Jack Bowen, which still meets once a month. A member of the Hart family, Peter Hart, sits on the board. For the past 10 years there has also been an external director, former Reece executive Neil Cathie, who had a 27-year career at the nation’s most successful plumbing and bathroom distributor.

“I’ve been fascinated by the Reece story. I think Reece were and still are just amazing. They are an unsung Australian business, one that not enough people know the story of. They are the best in the world in what they do,” John Bowen says. “Neil left that business over 10 years ago and we were fortunate to fall across him.”

Bowens CEO

There are no plans to float Bowens as its turnover this financial year – expected to be over $460m – makes it too small to be a significant public company.

“We are not super wealthy, we enjoy what the business gives us. Private ownership is important to the staff – there are plenty that have been there for 20 years plus,’’ Bowen says. “I’m fiercely independent. It is a shame how many businesses are being swallowed up by big box players.”

While his brother Andy is 12 years younger, John says he has enjoyed working with him in management because they are “literally a generation apart”.

Andy Bowen’s focus has been establishing an e-commerce function for the business. Principally for the trade, but also increasingly for retail customers.

Bowens’ 16 stores across Victoria and its range of delivery options were repurposed by creating a digital front end, allowing it to make promises to customers around tight delivery times, especially for large and often fragile products needed by builders on work sites.

“We have stores that are set up in an industrial manner which works perfectly for distribution when it comes to an online offer,” John Bowen says.

Future proofing

The e-commerce site was launched as a retail service in December 2020 and has generated a sharp increase in website traffic.

Bowens has also thrived through the depths of the pandemic, being declared an essential industry and allowing it to remain open under strict Covid protocols.

Bowens has benefitted from an unexpected lift in demand for new construction and renovations, driving record volumes through the business.

Supply shortages have also led to unprecedented price increases for timber products and more recently, associated hardware.

“It started with timber. That has flattened out now. I really don’t see it jumping much again. For some of the other products, they have really only got some (price) momentum at the moment,” Bowen says.

Imported timber products have also been impacted by global supply chain issues, which have flowed through to price increases for engineered wood products, vital for beams and other structural timbers in buildings.

While Bowens uses largely Australian products, others in the market rely on imports.

“The market across Australia relies a lot on what’s happening overseas and North America has virtually cut itself off from Australia. So those importers have had to move to other markets. It’s very difficult and then very expensive,” Bowen says.

He expects these market conditions to remain the same for the first half of 2022.

During the pandemic Bowens continued to invest in its operations, including in a new prefabrication plant, showroom and a new timber yard in Geelong.

“You’ve got to keep investing. Independent businesses can’t just stand up and say ‘We are family owned and independent so therefore people should walk in and buy from us’,” Bowen says.

“We need to keep rebuilding our stores, investing in them and making sure the product that they stock is relevant, rather than just resting on the laurels of 127 years.”

Going forward he says the firm will stick to its knitting, increasing its site footprint with new facilities and innovative products.

He believes the Timbertruss plant at Geelong – which specialises in producing roof trusses and wall frames – is the most technically advanced in Australia.

“So we are doing a few really exciting projects, not just walls, roof trusses or floor systems. We are doing some pre finished panels for customers. Our version of next stage prefabrication we’re calling it,” Bowen says.

He also wants more women in what continues to be a male-dominated business. The firm last year had its first ever women in trade event at its Port Melbourne showroom.

Bowen has no expectation his four children – two are still at school – carry on the family name in the business.

“My wife and I are very keen for our children to find their own way outside of the business.

“We will give them opportunities at some point, but at this stage, we want them to start outside and see if I can find another path first.”

He will continue to live by the motto - which has served four generations of his family - that “We can’t be anything unless we are the best at the basics.”

“That’s something that I reiterate to our team again and again. Having the right product, serving people the right way, getting it out onto site on time and accurately, continues to be our first priority,” he says.