“Mates help mates”: How this rural business grew into a $25 million company despite being rejected by the big banks

Southern Cotton took home Telstra’s regional business award this year despite only starting up four years ago when six cotton growers decided to build their own cotton gin over lunch. Today, the business turns over more than $25 million and has injected millions of dollars back into its local economy in the fertile Riverina region of NSW. Southern Cotton has done all this despite initially being turned away by the big banks which thought the cotton producer wouldn’t even get off the ground.

SmartCompany spoke to Southern Cotton’s general manager Kate O’Callaghan about the benefits and challenges of running a business in a rural area.

I grew up in the city but my dad’s family were from the bush. I’ve always had a love of agriculture.

When the Southern Cotton directors gave me a ring and asked “was I interested in a challenge running the operations part of the business?” I said “yes”.  

My previous experience suited me well as managing farmers and crops is the same no matter what the crop is.

I had to build the computer systems and all the HR and safety documents. It was a completely new business and we had to build everything from scratch.

Some of the career highlights have been getting the cotton gin accredited for best business practice. For that, an independent auditor has to come in and look at all your processes.

Some of the volumes we’re doing have also been very exciting. Last year we processed our 500,000th bale.

We do a lot of mentoring in this region. The more cotton that’s grown, the more ginning we have.

We do a lot of work with growers looking at getting into cotton by running education seminars, newsletters and just talking about the advantages of cotton whenever we have the opportunity.

The biggest chance to grow the business is to grow the industry. That’s something we’re putting a lot of work into.

The business is owned by farmers and the thing about the cotton industry is people help people. Everybody loves to see other people succeed.

It’s a country culture where mates help mates. Our mission is to not only to educate growers but the greater public on the efficiency and sustainability of farmers in this area.

A lot of businesses are centred on their own growth, but we’re about more than that. That’s what I love about our business.

Farmers often get a bad rap because people think they’re using a lot of water and a lot of chemical sprays. It’s a real passion of mine to let people know they are efficient.

A cotton gin is a really dangerous place. The one thing that keeps me up at night is the safety of all my staff.

Some people do stupid things that are out of your control even if you’ve got the greatest systems in the world.

The other thing that keeps me awake is cash flow.

We finish ginning in October until March and we’ve got to manage the cash flow in the off-season. That is pretty tricky and involves some tight budgeting.

You shouldn’t be afraid to take risks, both professionally and with the business.

Don’t be afraid to take a leap into a new direction just because you don’t know where it is going to take you.

Research your industry as much as you can. When we were building the cotton gin here, the directors went overseas and talked to as many people as they could to put the best equipment and processes in our gin.

We’re really proud of what we do to support the wider rural community. We have given donations to charities and support local research.

In a little community it’s important that businesses support others and that’s something unique and special about rural agriculture.