R&D grant boost for sensory product

Greg Jarvis' goal is to double his company's annual revenue in the next five years.

Bluelab Corporation, which makes electronic metering and control devices to aid plant growth, will use a new research and development growth grant to speed up taking a new sensory product to market in the next year.

Tauranga-based Bluelab decided in 2004 to focus solely on manufacturing measuring equipment which is used in controlled growing spaces such as greenhouses, hydroponics and aquaponics by commercial growers and backyard hobbyists.

It exports nearly all it produces to 15 countries, with the major markets being the US, Australia, and the UK.

It was one of 14 companies among the latest growth grants handed out by government-funded Callaghan Innovation which are estimated to be worth up to $15.8 million over three years, based on applicants' indications of their likely research and development spend.

Qualifying companies can claim back 20 per cent of R&D expenditure capped at $5 million a year, providing they have spent at least $300,000 and 1.5 per cent of revenue a year on R&D in New Zealand.

Bluelab chief executive and majority shareholder Greg Jarvis said he's unsure at this stage how much he will be claiming back but the company already spends around 5 per cent of revenue on R&D.

He wouldn't disclose the annual revenue, but says it has doubled in the past five years as export growth ramps up.

The goal is to double it again in the next five years.

The grant will help the company commercialise a new product in the next year. The sensory product is at the prototype stage after two years of development but Jarvis said taking the next step to bring it to market has kept getting put on the backburner because of more pressing needs.

"What this grant does is allow us to focus on research further out rather than immediate product improvement work. We can look at what technology is starting to emerge and how we can integrate that into our business," he said.

Jarvis said another aspect the R&D spend will go on is taking existing products such as its hand-held meters and automated dosing and control devices and deploying remote sensing for them from the internet and mobile devices.

All of Bluelab's products are customer-centric, designed after customer feedback. Jarvis said the company's current R&D is focused on providing the customer with better information - so rather than just providing a measurement, it also says what that means so a customer knows what they should do about it.

It was also working on simplifying calibration sequences for existing products because "if you had to tune your TV every time you turned it on, you would get pretty annoyed".

Bluelab sells through overseas distributors and currently has three US-based staff who provide after sales service.

Jarvis said he hoped to appoint another two or three staff overseas in the next six to 12 months, including some in Europe.

The other 49 per cent shareholder in Bluelab is Evanescent NZ, which is owned by three Tauranga men who are also directors.

(BusinessDesk is funded by Callaghan Innovation to write about the commercialisation of innovation).