Small Business

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A remote farm in regional Western Australia has developed a formidable export business after daring to be different.

Yabby farming seems like an odd diversion for a family raised on producing sheep, wheat and barley.

Yet for Mary Nenke and husband Michael, a simple motive led to their decision almost 20 years ago to move into aquaculture – they needed more cash.

“There was a crisis behind our business – we didn’t have any money!” says Mary Nenke, co-founder and director of Cambinata Yabbies. “Going into yabbies commercially was related to ‘the recession we had to have’. We had four children in education in the city – more than $100,000 a year to educate them in today’s dollars – so we needed more money.”

The decision has paid off for the Nenkes, who have created a great Australian family business on their property 300km south-east of Perth near the small wheatbelt town of Kukerin in Western Australia.

Formed in 1990, Cambinata Yabbies is the nation’s biggest yabby producer, exporting the delicious crustaceans to Asia, Europe and the US. The business is committed to building a sustainable economic, social and environmental future for rural and remote farmers.

A farming heritage

Before their experiment with yabbies, the Nenkes were already well known in their area, running a merino stud and growing barley, lupins and wheat.

With six children to bring up and a determination to give them all a good education, they decided to explore opportunities beyond traditional animal husbandry when the economy formally fell into recession under then treasurer Paul Keating in the early 90s.

The Nenkes had grown a few yabbies for their own consumption in the past, but things got serious when a friend called trying to source some fresh crustaceans for a Perth restaurant rang. The call changed their lives.

In a good year, Cambinata now sells 75 tonnes of yabbies, 70 per cent of which are sent overseas. However, the Nenke story is about more than the family itself. The surrounding community is a major contributor to the farm’s success, with other local producers supplying produce to Cambinata when demand outstrips supply.

Growing pains

The early days of yabbie farming were tough for the Nenkes. Aquaculture was seen in some quarters as a hobby, and most banks did not want to know about it.

Needing a biological reactor and a commercial tanker to chill yabbies to eight degrees, the Nenkes had to put themselves at the mercy of financial institutions. “It was hard to convince banks to do something that hadn’t been done before,” Mary says.

While they had an asset in the form of their farm to act as equity for a mortgage, Mary and Michael knew their long-term financing needs depended on proving to the banks that their business had a future. They had to change banks on several occasions as the farm required extra money for new growth cycles.

“You have to give them a good argument and show them it could be done,” Mary says. “The good thing now is the bank manager wants us!”

Success brought its own challenges. Although the yabby farm started as a side business, it soon “grew like topsy”.

“Part of our learning curve was that growth can hurt and, when too rapid, can result in severe cash flow problems,” Mary says. “Growth meant more money for buildings, transport, equipment, supplies, fuel and yabbies. There was also the cost that came with increasing our holding capacity – that is, stock on hand. The stock had to be paid for before we were paid!”

While sound business principles helped the business prosper financially, Mary believes other attributes have been just as crucial.

“To me the biggest thing is having a vision,” she says. That means having a sense of where you want to take a business, being aware of opportunities, and not being afraid to have a go.

One opportunity the Nenkes have grasped is government assistance – both from a financial and advisory viewpoint. In 2005, the farm received a federal government grant of $135,000 through the Food Processing in Regional Australia program.

Government assistance aside, Mary says building relationships and networking through groups such as the Women’s Regional Advisory Council has been instrumental to success. Technology has played a role, too, with the internet enabling the Nenkes to overcome the tyranny of distance and maintain strong bonds with key suppliers and clients.

Planning for succession

The Nenkes have been in the farming business for almost 100 years, and the signs suggest the family’s love affair with farming and aquaculture will continue. Mary and Michael are putting the necessary succession plans in place to ensure a smooth transition to the next generation. Eldest son Paul manages grain growing at the farm, middle son Derek examines value-added opportunities for the business, and youngest son Ian works with the live yabbies.

The future seems bright for Cambinata.

At all stages, though, decisions around the growth of the business will factor in family.

“Our business wouldn’t exist without our family,” Mary says. “There would be no purpose to it because we would be doing it just for the sake of doing it!”

Published on: Tuesday, June 23, 2009

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