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Josef Chromy: An Expert Vintage

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Sixty years ago a penniless young man fled war torn Czechoslovakia. Today, Josef Chromy is a leading Tasmanian food and wine exporter. Born in Czechoslovakia, Josef Chromy followed his father into the meat business, completing a master butcher and smallgoods maker’s diploma by the age of 20. With his family town a regional base for a Nazi command during World War II, and the country devastated by successive Nazi and Soviet occupation, Chromy decided to escape in 1950. Unable to even tell his parents or siblings of his plans, as they would be interrogated, Chromy set off to Russian-occupied Austria with two friends, never sure he would see his family again. Though minefields, soldiers and dogs guarding the border, the three boys made it across. The next step was to travel by train to Vienna. Sadly Chromy’s two friends were caught and returned to Czechoslovakia for imprisonment, while Chromy managed to elude the cordon and board another train several hours later. While on the train, he again escaped capture by pretending to be deaf and dumb to cover his inability to speak German when the train conductor approached him. Chromy survived five months in Vienna before sailing for Australia, a country he believed had a bright future, and was about as far away from Communism as he could get.

New beginnings

Only 20 years old, without cash or even the currency of speaking English, Chromy started working at Goliath cement and asbestos sheeting factory at Railton in northwest Tasmania. Working two jobs, he saved enough to start his own meat business. Unfortunately it fell over due to lack of capital and language barriers. Undaunted, Chromy paid off the creditors and started again, also marrying Alida, a new arrival from Holland, in 1954. Together they learnt English and in 1957, Chromy opened his own butcher shop in Burnie. In 1958, he changed its name to Blue Ribbon Meat Products, with an initial turnover of $160,000 per annum and five employees. Over twenty years, Chromy developed the company, acquiring farms, 18 butcher shops, piggeries, distribution centres, factories and abattoirs along the way. In 1972, he announced his intention to establish an export standard abattoir so he could enter overseas markets with premium lamb and beef cuts from Tasmania. In 1979, he bought the Killafaddy Abattoir at Launceston, which enabled Blue Ribbon to commence exporting Tasmanian beef, lamb and mutton. Chromy continued to expand the business and moved to Launceston in 1984 to facilitate the running of what was now a statewide business with plants at Smithton, Camdale, Launceston and Hobart. An industry-wide rationalisation saw Chromy sell off all of his red meat operations to the RMI Group in exchange for shares in 1985. However, when the rationalisation fell over a year later, the shares were rendered worthless. Chromy rebuilt and in 1992, at the age of 62 years, was awarded Tasmanian Executive of the Year. Blue Ribbon then employed over 540 people, with annual sales in excess of $75 million. In 1993, Blue Ribbon was successfully floated on the ASX and in 1994 the company won the Austrade Agricultural Products category at the Australian Export Awards.

The Perfect Drop

The entrepreneur then saw a new challenge in the emerging Tasmanian wine industry, noting that it was undercapitalised but with huge potential for growth. The Blue Ribbon float provided the capital for Chromy to set up the JAC Group of companies, and in 1994, they bought Heemskerk, Rochecombe and Buchanan vineyards, also establishing a new vineyard at Kayena; the purchase also included the Janz brand. This effectively made the Heemskerk Wine Group the second largest major producer in Tasmania’s wine industry. In 1997 Chromy was awarded the Medal of the Order of Australia for services to the meat industry. The same year the Heemskerk Chardonnay (1995 vintage) was awarded Chardonnay of the Year by Winestate magazine, beating 841 others from Australia and New Zealand. In 1998, Chromy moved forward again, selling the Heemskerk Wine Group to Pipers Brook for $11 million. He retained the Kayena vineyard and built a new winery there called Tamar Ridge Wines in 1998. Chromy also began investing in premium heritage properties around Tasmania, including Custom House in Launceston. The Tamar Ridge experiment became a huge success with sales of 9,000 cases of wine within the first 12 months. By 2003, Tamar Ridge was rated five stars by Australian Wine Companion writer and critic James Halliday. Chromy then sold Tamar Ridge wines to Tasmania’s largest company, Gunns Limited. In four years it had won 12 trophies, 20 gold, 36 silver and more than 100 bronze medals in wine competitions nationwide, with export markets developed in Canada, the United Kingdom, Denmark, Singapore, Japan and more.

The story today

Following the success of Tamar Ridge, Chromy bought another winery only 10 kilometres from Launceston at Relbia. Called Josef Chromy Wines, in only two years the winery has won more than 10 trophies, 17 gold and 93 medals, making it one of the most successful launches in the history of the Tasmanian wine industry. The JAC Group of companies continues to diversify, purchasing land around Tasmania for housing sites and also the Sea Cat terminal at George Town for development into a tourist and residential marina. In August 2005, just before his 76th birthday, Chromy suffered a stroke, but with his usual determination and extensive therapy, has worked hard to recover. Chromy continues as chair of the JAC Group, with his world-class wines still winning awards. Chromy himself was awarded the Export Leadership Award at the Tasmanian Export Awards 2008 and in June 2009, Minister for Trade Simon Crean presented him with an Australian Export Heroes award, initiated by the Australian Institute of Export.

Joe’s Insights

First export Chromy’s first export was in 1978, exporting lamb carcasses to the Middle East. Though a live trade had existed for some time, Chromy was among the first in Australia to find markets that would accept carcasses. Biggest challenge In addition to the generic challenges of distance and lack of scale in Tasmania, Chromy’s biggest export challenges were penetrating highly protected, and often quota restricted, markets like Japan. An example of this from the early 1980s was the virtually impossible restrictions on salted beef imports into Japan. However, there was a loophole for beef with over five percent salt content because it is considered inedible to humans at that concentration. Chromy experimented in secret and after many months came up with a successful method of infusing the salt to the right consistency. He subsequently shipped many hundreds of containers and was the only Australian exporter never to have a shipment rejected. The heavily salted beef was then made palatable by blending with unsalted product already there. Biggest successChromy’s biggest success was at the other end of the quality scale-exporting prime pasture-fed marbled beef into Japan. This success was achieved by taking a paddock-to-plate approach including:

  • Working very closely with the farmers who grew animals that were always either under their mothers or on lush green pastures. The northwest of Tasmania is a rare environment where this can be done.
  • Rigorous product grading using seven criteria including colour, texture, marbling etc.
  • Building a direct supply relationship with a major Japanese supermarket chain with frequent visits ‘back to the paddock’ by the buyers and ‘up to the consumer’ by Chromy and his team. This approach led to exports of more than $20 million per annum of this very high value product.

Advice for today’s exporters Chromy says: "Build relationships as close to the end customer as possible. Seek feedback and act on it. Exceed customer expectations-a very common fault in marketing is over promising then under delivering."

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