BQ North East Issue 12 by We Are UMi

www.bq-magazine.co.uk

ISSUE TWELVE: WINTER 2011

THE NAME GAME Teesside makes the running as enormous changes in regional funding start to bite

WHAT KATE DID NEXT The managing director of a decals printing company simply stuck to what she’s good at

CREST OF A WAVE A boat builder sets sail for a bright future buoyed by a healthy order book

ISSUE TWELVE: WINTER 2011: NORTH EAST EDITION

STEPPING UP ANOTHER LEVEL Graham Wylie reveals the day business came second to family - by a distance

BUSINESS NEWS: COMMERCE: FASHION: INTERVIEWS: MOTORS: EVENTS

NORTH EAST EDITION

Business Quarter Magazine

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The University for BUSINESS

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WELCOME

BUSINESS QUARTER: WINTER 11: ISSUE TWELVE ENTHUSIASM is something we all welcome just now, especially when it has a youthful quality. Hence our pleasure in introducing Will Ryles and Kate Wickham. Will, at 23, has launched his own business, commissioning the designing skills of his accomplished father and drawing his inspiration from a grandfather whose adventures in colonial Africa will also, surely, keep you entertained. Kate, at 27, has worked her way up to managing director of the family company, drawing on work experience in Japan and Belgium, and on her determination in-house not to ask any member of staff to tackle any job she felt she couldn’t do herself. She’s excelling in the macho world of earthmoving machinery. In Chris Millman we find a marine entrepreneur who, instead of getting over-nostalgic about our region’s once great shipbuilding tradition, is recruiting as many of its traditional skills – and as much of the manpower versed in them as he can accommodate – to ride even higher on waves of success with his young, yet already world-renowned business in boatbuilding. Other entrepreneurial insights this time round include a discussion with the telecoms moneymaker Ian Gillespie and his team, who are steering another young business, Activ Telecom, on a course bound to give those of us in the small and medium size business zone something to ponder. Through Colin Heal, an expert of many years in his particular retail field, we learn something about our growing preference towards that most important item of furniture, the bed. Also, at a time when the recent banking excesses blow even bigger holes in our pockets, we meet Kevin Pattison whose satisfaction is gained from leading a restoration of what many bank customers long for, a return to “old fashioned” banking as we knew it 30 years ago. It’s both topical and appropriate to pay tribute

to the workforce of 3,500 which has assembled most ingeniously the second vehicular tunnel under the Tyne. It’s also topical and appropriate, as Teesside takes new directions with its own local enterprise partnership, to ask service industries’ Mr Teesside, John Irwin, to venture opinions about the future for this area of the region he holds dear – an area he almost never knew! On Teesside also Nigel Perry, chief executive of the Centre for Process Innovation, gives his views on prospects for the largest segment in the North East’s economy. Thankfully that’s something else to cheer us – as indeed the report on progress in Sunderland, as catalogued in this issue’s BQ2. Most moving, however, is our table talk with multi-millionaire Graham Wylie, who through family crisis has found a new and richly rewarding project to promote and invest in – richly rewarding in assurances of happiness it will spread for others. Don’t miss that story. Brian Nicholls, Editor.

CONTACTS ROOM501 LTD Christopher March Managing Director e: chris@room501.co.uk George Cheung Director e: george@room501.co.uk Euan Underwood Director e: euan@room501.co.uk Bryan Hoare Director e: bryan@room501.co.uk EDITORIAL Brian Nicholls Editor e: b.g.nicholls@btinternet.com DESIGN & PRODUCTION room501 e: studio@room501.co.uk PHOTOGRAPHY KG Photography e: info@kgphotography.co.uk Chris Auld Photography e: chris@chrisauldphotography.com ADVERTISING If you wish to advertise with us please contact our sales team on 0191 537 5720, or email sales@room501.co.uk

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THE LIFE AND SOUL OF BUSINESS

room501 was formed from a partnership of directors who, combined, have many years of experience in contract publishing, print, marketing, sales and advertising and distribution. We are a passionate, dedicated company that strives to help you to meet your overall business needs and requirements. All contents copyright © 2011 room501 Ltd. All rights reserved. While every effort is made to ensure accuracy, no responsibility can be accepted for inaccuracies, howsoever caused. No liability can be accepted for illustrations, photographs, artwork or advertising materials while in transmission or with the publisher or their agents. All information is correct at time of going to print, February 2011.

NORTH EAST EDITION

BQ Magazine is published quarterly by room501 Ltd.

BUSINESS QUARTER |WINTER 11

CONTE BUSINESS QUARTER: WINTER 11 MORE THAN A NAME

Features 50 ROAD MAP MAKERS

SMEs go where only the big boys went

20 WHERE THERE’S A WILL Elegance, style and luxury in bathrooms

34 MORE THAN A NAME John Irwin discusses Teesside’s future

38 HOLE LOTTA LOVE Under the Tyne via the new tunnel

44 WHAT KATE DID NEXT She stuck to what she’s good at

BUSINESS QUARTER | WINTER 11

76 CURRENT ACCOUNTS A Handelsbanken on business

CURRENT ACCOUNTS

82 THE CREST OF A WAVE Chris Millman’s custom-built boats

86 AND SO TO BED Lying down on the job with Colin Heal

90 IN ANOTHER LIFE Rob Charlton goes into _space

TENTS NORTH EAST EDITION

26 COMMERCIAL PROPERTY

BUSINESS LUNCH

The landmark developments creating the North East’s industrial landscape

54 BUSINESS LUNCH Jane Pikett meets Graham Wylie at Louis

Regulars

60 WINE Graham Henderson sips French sunshine

62 FASHION

The shoes ﬁtted, so he bought the ﬁrm

ON THE RECORD Making the news in Q1/11

10 NEWS Who’s doing what, when, where and why, here in the North East

18 AS I SEE IT Nigel Perry is excited about innovation in the process industry – the largest segment in the region’s economy

MOTORS

68 KIT Riﬂing the past with a classic gunmaker

72 MOTORS Bentley Continental Supercar road-test

94 FRANK TOCK Gripping gossip from our backroom boy

96 EVENTS The best events this coming quarter

72 BUSINESS QUARTER | WINTER 11

ON THE RECORD

WINTER 11

The North East wish-list, our friends electric prove the Yanks are coming, Durham business is in boost mode, the recruitment company with stars in its CV and Robson Brown on the Mission position

>> What the North East needs The North East Chamber of Commerce (NECC) has set out a manifesto vital for the coalition Government to take up, it says, if its tough spending cuts are not to cripple the North East economy. Actions called for include: Transport • A tax and regulatory system supportive of air links between the North East and key markets • A detailed timetable for including the North East in a high speed rail network. Strategic sector support • Targeted sector support where the North East shows genuine excellence • Regional Growth Fund bids that unlock investment in low carbon industry, including R&D.

>> SEV’s now American Smith Electric Vehicles US has bought its British parent firm Smith Electric Vehicles (UK). Under the deal, Smith UK’s current owner, Tanfield Group, retains a 49% stake in Smith Electric Vehicles US. Bryan Hansel, head of the US business, indicated the sale shows the market for affordable and sustainable commercial fleets in electric vehicles is fertile. “The unification will create operational efficiencies and market synergies, making Smith more financially sound and productive,” he said. Smith Electric Vehicles was set up as an arm of Ringtons, the Newcastle tea firm, in the 1920s. Its name became synonymous with milk floats. Then it diversified further with the Edison and the Newton commercial models. Tanfield, which also makes powered access vehicles, suffered a 2008-2009 sales fall of 60% to £58m, making losses in consequence.

BUSINESS QUARTER | WINTER 11

International trade • Strategic export support in line with specific regional strengths and opportunities to broaden the base of exporters. Infrastructure • Mechanisms that direct investment towards areas of capacity, not congestion – including through grid connection charges, transport spending criteria and use of water assets. Skills • Support for employers taking on and retaining apprentices to take the risk out of this investment. Public procurement • Reforms to create broader, simpler and smarter public procurement in the North East.

>> Rock nears a sale Northern Rock is talking with advisers to press forward a return to the private sector. It could be sold for £1.5bn. Suitors to date include Tesco, Richard Branson’s Virgin Money, and private equity group JC Flowers. Tesco is already creating 1,000 jobs in a new customer sales and service for Tesco Bank’s home and motor insurance customers in Newcastle. An alternative move to restore Northern Rock to its original mutual status of a building society looks unlikely to win favour with a Tory-led coalition government. But a stock market flotation to attract small investors back is not being ruled out altogether. The former mortgage bank was nationalised in February 2008 after suffering the first run on a British bank for 150 years.

Finance • Continuation of targeted support for businesses through the Finance for Business North East programme • Banking reform which does not undermine lending to businesses • Commitment from banks on speed of decision-making and transparency of process. Tax • No new use of local taxation powers or increase in local authority charges to business in the North East during 2011. Innovation • Maintaining support for key sectors, including through regional innovation centres. The NECC says it will campaign on these points throughout 2011.

>> Pension blow to SMEs Changes to pensions and retirement rules will hamper job creation among smaller firms, a business support body warns. The Forum of Private Business argues that the Government’s decision to force companies into providing pensions for employees and removing the Default Retirement Age (DRA) will doubly set back smaller employers. And, the forum adds, making businesses of all sizes provide pension facilities from 2012 – even if they only employ a single person – will add cost and create extra administrative burdens when small businesses can least afford it. The move could cut the number of permanent jobs small to medium-size firms offer – and increase the use of temporary staff and self-employed labour. More than 70% of small businesses also expect the VAT rise to be damaging, a member survey by the Federation of Small Businesses (FSB) suggests.

WINTER 11

ON THE RECORD

>> Wellstream sells out

>> Conference booster

General Electric finally acquired Tyneside offshore firm Wellstream. The American firm secured the deal with a revised £800m bid. So Wellstream, a lot of whose business is now done out of Brazil, becomes part of GE oil and gas. The Walker, Newcastle, firm employs 400 people locally. It twice rebuffed earlier GE offers. A special dividend was promised for Wellstream shareholders.

A website to boost conference and meetings business in County Durham is up and running. The site, created by tourism agency Visit County Durham, has had support from regional development agency One North East. Backing also comes from Radisson Blu Hotel Durham, Emirates Durham International Cricket Ground, Event Durham (the business and conference arm of Durham University), Durham Marriott Hotel Royal County, Ramside Hall Hotel and Golf Club, Barcelo Redworth Hall Hotel, Hardwick Hall Hotel at Sedgefield and Headlam Hall Hotel and Spa in Teesdale. www.meetindurham.co.uk

>>Just the job Northern Recruitment Group (NRG) has won a Best Companies award for the second year in a row. The scheme is decided Michelin star-style, with firms awarded “ones to watch”, one star for first class, two stars for outstanding and three stars for extraordinary performance. Over a year the business has also positioned into four key business streams – recruitment, executive search and selection, managed services/RPO and talent development. It was, further, the first UK recruitment firm to launch an iPhone app. It has gained distinction based upon employee engagement and feedback. Group managing director, Therese Liddle says: “We’re delighted, awarded not only a Best Companies award again – by our staff – but also retaining our first class, one star ranking.”

by Andrew Marwick. The RB management thus has the financial backing and stability that had been lost after the firm’s original founders sold their controlling interests last March. Marwick, RB’s managing director back in his old job, says joining the London-based Mission Group has saved the brand and given opportunity to re-cement Robson Brown’s status as a leading creative agency in the North. The group founders Alan Brown and Stuart Robson had built the business over 25 years to a turnover of some £37m when they sold out to Round 2 Communications of California. Under that ownership the firm became a platform for further buys in Europe but ambitions overstretched. The Mission Group in December bought certain assets from the administrators, including the name and intellectual property rights.

>> Staying ahead Delighted: Group managing director, Therese Liddle

>> Agency recovered Robson Brown, the Newcastle advertising and public relations agency, survived weeks in administration and is now part of the Mission Marketing Group plc, led once more

Major North East firms continue to prosper amid the economic difficulties. Among recent annual figures published, Sage plc’s software activities have shown a 14% rise in latest annual profits despite flat revenues of £1.4bn. Northumbrian Water, in spite of losing a number of corporate clients on Teesside through closures, raised its sales by 5.4%

All for Durham: Left to right, Melanie Sensicle, Visit County Durham; Neal Holloway, Radisson Blu Hotel Durham; Jonathan Pritchard, Barcelo Redworth Hall Hotel, and Kate Horner, Event Durham

to £346.3m, lifting pre-tax profits by 3.1% in its annual results. Barbour at South Shields, by growing share of the US market, raised turnover in its manufacture of clothing by 10% to £74m, though profits slipped from £12.9m to £10.1m. Helped by acquisition of Stockton Healthcare, Norchem the County Durham pharmaceuticals firm saw profits rise from £759,362 to £1.3m despite a £3.4m slip in turnover to £34.9m. In half-year reckonings, Northgate the Darlington based hirer and leaser of commercial vehicles, has recovered from a sticky patch and saw pre-tax profits climb 24% in a half-year despite income down from £374.3m to £367.9m. Brulines, the Stockton provider of data management services, raised its interim profits by 2.8% on sales up by 23.9% to £12.27m. Its most recent acquisition, M2M of Bolton, is to be the last for some time, it says. Wales was the only region showing a rise in business failures year on year last year – at 3.5% – according to business information firm Equifax. Insolvency trade body R3 finds almost one in five UK businesses (19%) worried about their owings to creditors. But that’s mostly in the Midlands.

BUSINESS QUARTER |WINTER 11

ON THE RECORD

WINTER 11

>> QUOTE OF THE QUARTER

Historically I would never get involved in start-ups – far too hard. Generally, entrepreneurs spend 95% of their effort quantifying the costs and 5% thinking where the revenue will come from and securing the revenue stream. That’s why 70% of start-ups fail... Northumbrian dealmaker and business investor John Wall

>> Shaped for success Roman, the Newton Aycliffe showers firm, has gained a Northern Design Award for its Sculptures range from readers of Concept for Living magazine.

Mick Thompson, senior partner at Newcastle, says commitment, effort and success from the 160 staff in Newcastle contributed “in no small part” to the credentials behind the accolades.

>> Metro for service

>> Fashion recovery

DB Regio Tyne & Wear, operator of the Tyne & Wear Metro, has been awarded the Customer Service Excellence standard by the Cabinet Office following an assessment made seven months after taking over the running.

The Officers Club could open 20 new menswear stores during 2011. Dave Charlton, owner of the Cramlington-based chain, expects latest profits to touch £500,000 in its bounceback from two years earlier when the parent company went into administration.

>> Complement-ary work

>> Brighter tracks

DNA biotech specialist Complement Genomics has spread into drug and alcohol testing. Under chief executive Louise Allcroft it earlier made its name through its officially recognised service of paternity tracing. Its DNA skills are also used for pedigree verification in animal breeding.

Astrum the Stanhope, County Durham, manufacturer of tank and other heavy vehicle tracks, expects sales to be 10% up by the end of March – despite less demand through spending cuts in defence and heavy vehicle manufacturing.

>> No has-beans KPMG has been named Global Firm of the Year at the Accountancy Age Awards. It also won three more honours – Business Recovery Project of the Year, Young Accountant of the Year and Accounting Technician of the Year.

BUSINESS QUARTER | WINTER 11

>> LEP approved A North Eastern Local Enterprise Partnership has been given government approval to cover seven local authority areas under the new regional development structure. The partnership covers Durham, Gateshead, Newcastle, North Tyneside, Northumberland, South Tyneside and Sunderland. Its population of 2m and an economy valued at £32bn a year makes it fourth largest of 28 LEPs bringing together councils, businesses, universities, colleges and the voluntary and community sector. Teesside area has its own LEP.

>> Hair raising Hair X-Tensions is raising its profile and changing its name to Harland Corporation Ltd, as it moves to a bigger site at Seaham Grange Industrial Estate. Director Darren Williams says the new premises are more than two-and-a-half times larger than the previous site.

>>Build-up in businesses

The North East now has a record 63,660 businesses. Figures from the Government show.

COMPANY PROFILE

WINTER 11

A year on from its launch, the £125m Finance for Business North East Fund is making waves across the region.

FLYING START FOR FINANCE FOR BUSINESS

illions of pounds have been ploughed into fast growing regional businesses over the last 12 months following the launch of the groundbreaking Finance for Business North East Fund. The North East economy has benefitted hugely from the £125m portfolio of six investments funds which are celebrating a successful first year in operation. Launched in January 2010, Finance for Business was the first investment fund of its kind in the country, using public money to drive economic growth, encourage enterprise and attract private sector funding. Since making its first investment last April – when Gateshead-based games developer Eutechnyx received backing towards the development of new platforms – over 70 other investments have been made. All six funds in the portfolio have completed investments with companies and entrepreneurs across a broad spectrum of industries receiving backing. Emerging sectors such as clean energy and healthcare have received support alongside established manufacturing and service businesses. Overall around £14m has been invested directly by the Finance for Business funds with millions more leveraged from the private sector in co-investments. The pipeline of deals also looks strong for 2011. Andrew Mitchell, chief executive of North East Finance which manages the programme, said: “We’re exactly where we hoped we would be after the first year. Demand has been strong, as we anticipated it would be given the financial climate, but the standard of the investees has also been very high and we’re confident of building a strong legacy. “The fact that we’ve secured so much private sector co-investment demonstrates the impact we’ve made in a short time. It shows the role public sector money can play in driving deal

EXPANSION PLANS SPICED UP: Cinnamon Property Lawyers has received £90,000 from NEL Fund Managers via the Finance for Business North East Growth Fund to expand outside the region. Pic shows (from left) Jane Siddle of NEL, Cinnamon MD John Cook and Cinnamon associate director Vikki Todd.

THE MICRO LOAN FUND DEMONSTRATES THE FLEXIBILITY OF THE PORTFOLIO TO RESPOND TO MARKET DEMAND. MANY SME’S ARE STILL FINDING IT DIFFICULT TO ATTRACT FINANCE AND THE MICRO LOAN FUND ENABLES US TO HELP OUT WHERE THERE’S A CLEAR NEED making and stimulating the economy. “The funds have helped to fill the funding gap experienced by many SMEs and without this intervention some of these deals would have been impossible.” Managed by North East Finance, the fund will continue to invest through to 2014. The overall aim is to support over 800 businesses and create in excess of 5,000 jobs in the process. Finance for business North East is funded by money from the European Investment Bank (EIB), the European Regional Development Fund (ERDF) 2007-13 and regional development agency One North East. The £125m pot is divided into six separate funds, overseen by FSA approved fund managers, and targeted at specific sectors and businesses. They include the £15m North East Technology Fund, £7.5m North East Angel Fund, £15m North East Proof of Concept Fund, £20m North East Growth Fund, £20 North East Growth Plus Fund and £20 North East Accelerator Fund.

In addition to the six funds already in operation, a new £5m Micro Loan Fund has been set up to support small businesses finding it difficult to access finance. It will provide loans of between £1,000 and £25,000. Andrew added: “The Micro Loan Fund demonstrates the flexibility of the portfolio to respond to market demand. Many SMEs are still finding it difficult to attract finance and the Micro Loan fund enables us to help out where there’s a clear need.”

NORT H E AS T

FINANCE For more information about the funds visit www.northeastfinance.org or call 0191 211 2300

BUSINESS QUARTER |WINTER 11

NEWS

WINTER 11

A world-first from Sunderland, Tesco grabs Mills, footballers strengthen a law firm, Wilko opens The Gates, no fudging over expansion plans, saving money on pies, and why a Seaham dentist is smiling >> DIGITAL, SOFTWARE, IT >> Start-up explosion fuelled DigitalCity, which aims to create 160 jobs in five years, is nearer to being a self-sustaining cluster – thanks to £810,000 worth of new funding. The Tees Valley group now has joint funding from Middlesbrough City Council and European Union investment from the European Regional Development Fund. By March 2012, the goal is to create 20 new firms, developing 20 more into businesses with high growth potential and developing a further two into businesses of high growth. By 2015, the aim under director Mark Elliott is to raise DigitalCity turnover by 20% and increase international trade by 75%. Further targets include attracting six new businesses to the region, supporting 424 firms in all and helping 80 people further their skills development. Improvement to digital infrastructure is the key to the North East’s economic growth, the North East Chamber of Commerce says. But it believes upgrades are urgently needed on the region’s digital network. One aspiring young entrepreneur has, even so, launched what he hopes will be recognised as the world’s first 3D website. Saif Chaudhry recently set up an integrated

stereoscopic 3D content and technology consultancy in Sunderland. From there he has launched 3D website www.stereoscopic-3d. co.uk which allows users to surf the internet in 3D using the latest generation of 3D capable HD TV sets. Saif, whose background is in 3D, launched Stereografix last March. He has the support of Sunderland City Council and Sunderland Software City. Stereografix has also developed a programme of 3D training courses to enable existing businesses and freelances to learn skills needed to create stereoscopic 3D CGI, games, film and photography. Chaudry, originally from Manchester and a graduate of Sunderland University, says: “Candidates on the training courses may also be eligible for up to £800 of funding through Skillset. Many businesses still mistakenly believe they need a Hollywood budget to produce high quality 3D.” The company is partnering Durham University on a range of research and content production projects.

>> Super simple Software developer Bolsover Networks has launched an online retail support, Super Simple Shop. The work of former Discovery Channel software designer Nick Reavill and his business partner David Shapero, Super Simple Shop enables small retailers to tap into online markets more effectively. Super Simple Shop has been developed in Newcastle following a commission from a jewellery designer and retailer to create a website and online offering. www.supersimpleshop.com

The firm offers smaller-scale web hosting, internet access, space for server co-location, dedicated server rental and disaster recovery space. Gateshead Council has given technical and business support, including internet access at no cost via a superfast fibre optic network, through its JV company G-ti. Phase one of the business involved a £650,000 investment. Phase 2 is being planned with a £1.1m data centre. Mosley expects to double his staff to eight when phase 2 is completed.

>> Onyx on a cloud Onyx Group’s cloud computing offer OnyxCloud is getting a £250,000 loan from North East Technology Fund. The investment in Stockton based Onyx by IP Group covers two years. Cloud computing has changed the way many businesses run and communicate. It offers a new way of computing by internet, on demand from data centres that broadly share computer resources instead of using software or storage on a local PC. So it cuts spending on IT infrastructure and offers “pay as you go”. Onyx chief Neil Stephenson says: “A lot of IT providers have a Cloud offering. Ours offers a total package.” Onyx has also made five acquisitions in twoand-a-half years.

>> Enter NE1 Internet

Here’s how: Saif Chaudhry, right, shows Sunderland councillor Bryan Charlton how the latest 3D films are made.

BUSINESS QUARTER | WINTER 11

Local resident Ken Mosley has used his experience of telecoms, electronics and website hosting to set up NE1 Internet in Gateshead’s Creative Quarter beside the Tyne Bridge.

Cloud covering: Onyx Group’s chief Neil Stephenson, left, with IP Group’s investment manager Ian Wilson.

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COMPANY PROFILE

REGIONAL BUSINESSES, WINNING CULTURES Global hotel chain the Hilton, utilities company Northumbrian Water and North East indigenous SMEs including market research company Explain, the theatre, Northern Stage, and mobile telecommunications company, CCS Mobile are amongst the region’s businesses that have scooped accolades at Service Network’s prestigious Culture for Success Awards over the past few years. 2010 was undoubtedly a tough year for the region with many businesses facing multiple challenges and pressures. But despite this, the North East has dug deep and is emerging stronger with renewed resilience, innovation and stronger leadership, clearly demonstrated in past Culture for Success Awards winners. Carsten Staehr from Cintra HR & Payroll Services, past winner of the medium business category

(2010), comments “The Award was confirmation that we have succeeded in creating a culture which promotes success and a fantastic working environment.” In 2011, the Culture for Success Awards are expected to be more competitive than ever. These Awards are different from most; they focus on the culture of an organisation as a whole and previous applicants have found that just by entering, it allows them to step back, take an analytical view of their companies, and appreciate the value of their organisation and all the successes it has achieved over the past year. Chair of Service Network, Neil Warwick says: “This year’s Awards are already generating a real buzz within our region’s business community. We are expecting not only a high number of applicants but a very high standard of applications once

again this year. With our Awards being open to all businesses, irrespective of size, specialism or sector, they offer a great opportunity for regional organisations to shout about their successes.”

For more information about Service Network’s Culture for Success Awards that take place on 7th April 2011, please visit: http://www.service-network.co.uk/awards or call the team on 0191 244 4031. Applications for entries close on 18th February 2011.

Call for entries now open!

Service Network invites you to celebrate the achievements of your business by entering the Culture for Success Awards 2011. The Awards are open to any company irrespective of sector, specialism or size; so whether you’re a small organisation with a handful of employees or a multinational company with thousands of staff, we want to hear from you. To download an application form visit: www.service-network.co.uk/awards The Eighth Annual Culture for Success Awards Deadline: 5.00pm, Friday 18th February 2011. For more information call 0191 244 4031 or email: talk@service-network.co.uk

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BUSINESS QUARTER |WINTER 11

NEWS

WINTER 11

>> Fillip for films Two North East film companies have secured investment topping £1m to support their work. The award-winning independent film and television producer Dene Group is getting £795,000, some of it for new equipment. And Bonafide Films is getting £300,000 via Northern Film & Media and Northstar Ventures and the £2.4m Finance for Business – North East Creative Content Fund. Set up 19 years ago by six-time Royal Television Society winner, Steve Salam, Dene Group works also from London and Manchester. It claims to be currently the largest provider of commercials to ITV regionals. Its first network TV commission, a documentary, is on Michael Palin’s centre for children with speech difficulties. Bonafide’s backing, which also involves Rockford Asset Management, enables business partners Margery Bone and Sacha Alexander to produce more programmes. Current ventures include Undercover – a sitcom co-production with Steve Coogan and Henry Normal’s Baby Cow for television. The company is also developing a sci-fi series Korridor. Bonafide was launched by producer Bone and comedian Alexander in 2008 after Alexander’s feature Gigolos was described as “the most underrated film of all time” by the Daily Telegraph.

>> Selective billing Touchstone Leads, a Shildon, County Durham, firm of telemarketeers, has won contracts with HSBC and Santander banks and northern legal firm Ward Hadaway in its maiden year of business. The firm, launched by Kevin Ireson after his decade and more as head of sales for a large UK corporation, only bills clients for leads meeting their criteria. It expects turnover to double this year to £500,000.

>> Rose and Crowned Chris Davy, proprietor of the multi award-winning 18th Century Rose & Crown Inn at Romaldkirk, County Durham, has been appointed a member of The Master

BUSINESS QUARTER | WINTER 11

Innholders, and now holds the Freedom of the City of London. He is the only Master Innholder in the North East.

Store. Opened in 2007, it has outlets at Whitley Bay, Barnard Castle, Chester-leStreet and Hexham.

>> Solar power boost

>> On the tiles

Three energy installation firms are to help bring solar power to homes across the region, as preferred installers by community interest company, Community Energy Solutions (CES). Cleaner Air Solutions, of Meadowfield in County Durham, Rothwell Plumbing Services of North Shields and the Dodd Group, which has a Teesside depot, are now installing solar photovoltaic (PV) systems for Boldon based CES – 2,000 in the North East and Yorkshire and the Humber.

A husband-and-wife team expect their new mobile business will end decorating disasters in kitchens and bathrooms across the region. The days of DIY enthusiasts buying tiles that look great in the showroom but mismatched to surroundings once fitted at home could be numbered thanks to The Mobile Tile Company. The Newton Aycliffe firm taking the showroom to customers on wheels has been set up by self-employed tiler Ian Dobson and his wife Nicola.

>> Talk of the T T-Mobile says a national survey of 2,000 small business owners suggests that in Newcastle a quarter of them waste an hour or more a day on long-winded chat. If conversations don’t get to the point within five minutes, 78% of small business owners in Newcastle will switch off. It was also found that “blue sky thinking” and “out of the box” are among the phrases most hated in conversation.

>> With respect Companies across the North East are being invited to be part of the UK’s primary initiative for recognising impacts of responsible business practice. Business in the Community’s annual Big Tick Awards for Excellence highlights firms that make an impact on their communities, the environment or wider society. The free-to-enter initiative recognised Gentoo Housing, John Lewis Newcastle, Esh Group and Castlebeck last year. Entries close on March 4. www.bitc.org.uk/awards

>> Ex-stars in action Three well known names in North East football have signed with a regional law firm to strengthen its sports representation and management team. Former England player and Middlesbrough and Bolton manager Colin Todd has joined BHP Sport, part of BHP Law, as a sports consultant. He has been joined by former Boro player and Gateshead manager Gary Gill and ex-Sunderland player Gary Bennett, whose voices are familiar on local radio football programmes. With revenues doubled in a year, former Newcastle United and Middlesbrough star Irving Nattrass and his wife Vicki expect eventually to double also the size of their clothing store chain, The Factory

>> Zenith on the up Zenith People, a Hebburn recruitment firm, saw a100% surge in sales in 2010. It had earlier been hit by reduced needs in automotives and engineering. Managing director Angela Anderson restructured.

>> Cancer test advance Kromek has a four-year contract with the University of Massachusetts Medical School (UMASS), to develop an advanced system for breast cancer detection and diagnosis. The contract, funded with $4m from the US National Institutes for Health, could sharply improve the way breast cancer is detected and treated.

WINTER 11

Although existing x-ray mammography has saved many lives through early detection, one of its limitations is that the recorded image represents a three-dimensional object in a two-dimensional way. Varying tissue structures – normal breast tissue versus tumour tissue – can be indistinct. Arnab Basu, chief executive of Kromek – the Sedgefield based x-ray specialist – suggests better resolutions will be found without increasing doses of radiation for patients.

>> Kids’ stuff Newcastle-based Jeremiah Alexander and Peter Hirst have launched a software programme, Every1Speaks, to capture children’s opinion about their school life and help staff monitor and improve the school’s performance. Four schools across the North East, one in New Zealand and one in Cornwall, have helped the business, which is supported by Newcastle Science City.

DIGITAL, >> Jobs with SOFTWARE, the laundryIT >> Hiring resumes Despite the pressure on jobs a number of North-East manufacturers are taking on more workers. Caterpillar, the multinational maker of offroad vehicles, plans to add 100 names to its 600-strong payroll at Peterlee, having earlier paid off 400 as recession bit. Manager Phil Handley says orders have quadrupled in a year. Materials manufacturer Thomas Swan, a pioneer supplier for nanotechnology needs, has hired 14 more staff following a return to profit after three years, thanks to a surge of orders from Asia and the Far East. The Consett firm now employs 138 in the UK. In retail, Greggs plans 100 more jobs for the region this year. And high street retailer Wilkinson is recruiting staff for a late-March opening in the 19,000sq ft store Waitrose occupied previously at The Gates shopping centre in Durham City. Centre manager Inge Johnson describes it as “a major store opening” for the city. “It underpins also the variety of offering at The Gates,” she added.

>> Fudging success Sweet success: Lisa Hodgson, founder of Loopy Lisa’s, and Pauline Blewitt, of BiB Insurance Brokers, celebrate a five-year partnership

NEWS

Lisa Hodgson switched from marketing and management to making fudge from her kitchen table. Today, six years on, her award-winning company makes fudge in 46 different flavours. Having made some for a friend to sell in her

We are the official partner of Newcastle Falcons and are hosting a business event at their stadium on 4th March. The event will showcase our latest products and services, and will feature key guest speakers. All attendees will also receive free tickets to that evening’s game.

Inge Johnson: Hails major opening Meanwhile Blyth based Omega Plastics has quadrupled staff and more than doubled sales following its reprieve from administration. It is adding seven more employees to 27 existing. With a £63,000 grant from regional development agency One North East it is also bringing in new machinery. Chairman Chris Thompson and managing director Dave Crone relocated the business from Gateshead in 2006 following its acquisition. Its present £2m turnover comes mainly from the defence, automotive, medical, health and hygiene sectors.

shop, Hodgson found rewarding markets at the Dales Food Festival in North Yorkshire and at farmers’ markets. In 2006, her company Loopy Lisa’s moved to a business unit at Evenwood, near Bishop Auckland, allowing her to develop new markets and take on staff. Besides selling through independent shops, >>

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BUSINESS QUARTER |WINTER 11

NEWS

WINTER 11

Loopy Lisa’s supplies National Trust properties in the North East and Fortnum and Mason’s food and gift store in London. She has been supported for over five years by insurance broker BiB of Darlington.

>>Struggle at the stores Nigel Mills’ decision to sell the convenience stores in his Tyneside based Mills group to Tesco has sparked anger among some of his peers. They claim it is helping Tesco use its own One Stop division as a shadow operation to tighten its grip on convenience as well as supermarket activities. The Office of Fair Trading may consider the proposed deal, which intends to leave Mills with six supermarkets. Around 17% of people using convenience stores shop there at least once a day, according to IGD, the food and grocery experts. And 59% use them at least twice a week. The 77 stores Mills is parting with are mainly in the North East and Yorkshire where One Stop is under-represented. The 25-year-old Mills business which Nigel Mills, an accountant, set up with his father, is thought to be bringing their family £9m through a 70% stake. About 750 jobs will switch to Tesco, including 35 at Mills Group’s Whitley Bay head office. Tesco has 3.5% of the convenience store market, which is dominated by independents. But the deal will give it 27% of the 6,350 convenience stores run by big chains.

>> Safety in numbers Fire safety firm Fyr Fyter is now part of national workplace services provider PHS Group. The Durham-based company is expected to have more resources and ability to meet a wider range of customer needs. PHS employs 5,000 staff across a network of 90 regional branches None of Fyr Fyter’s 11 jobs has been lost, the brand lives on, and the firm’s two founders, Brian Hogg and Paul Bainbridge, have continued to give support to PHS during a handover period before exiting after 10 years to pursue other interests. The deal for an undisclosed sum carried advice from Clive Owen Corporate Finance.

firm in 2008, after a spell at Scottish & Newcastle as a microbiologist. Under the KTP scheme graduates get a foot on their chosen career ladder while studying up to Master’s level or beyond and enjoy training and financial support. Often they are offered a permanent contract when the two-year scheme ends. Liberty is now the firm’s product improvement co-ordinator. Production manager Sheree Walker recommends the scheme to any business needing help and advice with recognised problems that never seem to get done. “Liberty is now looking at new ways to maintain the perfect pastry,” she said. ktp@tees.ac.uk

In safe hands: Left to right, Fyr Fyter dealmakers Phil Williams, associate director, Clive Owen Corporate Finance; Brian Hogg, joint managing director, Fyr Fyter UK; Martyn Tennant, partner, Swinburne Maddison Solicitors, and Paul Bainbridge, joint managing director, Fyr Fyter UK.

>> Last take-off Ryanair has closed its final route from Durham Tees Valley Airport, criticising the passenger charge recently imposed there.

One into two: David Frame, left, and his employees at DEF

>> Pies are squared

>> Young entrepreneurs

>> Growing in software

Liberty Horner, the first trainee graduate taken on by pork pie maker Vale of Mowbray, has squared up well in the firm’s drive to new levels of efficiency. The 23-year-old food science and nutrition graduate from Stockton has helped save the company £100,000 – reducing waste since joining as a Knowledge Transfer Partnership (KTP) associate. It is hoped she may now save £100,000 in other ways. “That’s just for starters”, says Liberty, who has many more ideas. She joined the Leeming Bar

Four aspiring young entrepreneurs were among 50 from all over the UK supported by Shell Livewire during 2010. They are: Nicholas Lee, whose Acadreamia in Bedlington is a textbook rental service, Christopher Bushell, whose bike hire by mobile phone business, Bikehire UK, is run from Sunderland, Catherine Langridge, whose firm Luminist Glass is at Stanley in County Durham, and Peter Noble (InnoVii Ltd), a ringtone specialist in Hartlepool.

A software entrepreneur who bought out a division of the business he part-owned has achieved a £500,000 turnover in 12 months and has set up a sister company to service new markets. South Shields-born businessman David Frame predicts his two software houses – DEF Software and DEF Apps in Boldon, South Tyneside – will reach a combined £6m turnover by the end of 2015. Frame formerly jointlyowned Datawright of Washington. The two firms employ eight in all. >>

BUSINESS QUARTER | WINTER 11

Advice that’s made made to to measure. measure. Advice that’s Because one size size doesn’t doesn’tfit fitall. all. Because one At Grant Thornton, we’ve always gone about our business in a At Grant Thornton, we’ve always gone about our business in a very different way. Delivering a bespoke service to all our clients very different way. Delivering a bespoke service to all our clients is our primary concern and we won’t offer you or your clients an is our primary concern and we won’t offer you or your clients an ‘off the shelf’ financial and tax solution. Far from it. Our advisers ‘off the shelf’ financial and tax solution. Far from it. Our advisers take the time to understand a client’s individual circumstances and take the time to understand a client’s individual circumstances and aspirations. We believe it’s important to provide flexibility to meet aspirations. We believe it’s important to provide flexibility to meet our clients’ needs, to tailor tailor our our solutions solutionsaccordingly accordinglyand andtoto our clients’ needs, to dedicate the right people to the job in hand. dedicate the right people to the job in hand.

For further information on our services or to For further information on our services or to arrange an initial consultation, please contact: arrange an initial consultation, please contact: Joe McLean Joe McLean Partner Partner T 0191 203 7790 T 0191 203 7790 E joe.mclean@uk.gt.com E joe.mclean@uk.gt.com

www.grant-thornton.co.uk www.grant-thornton.co.uk © LLP. All All rights rightsreserved. reserved.‘Grant ‘GrantThornton’ Thornton’means meansGrant GrantThornton Thornton LLP, a limited liability partnership. Grant Thornton UK LLP a member within ©2011 2011Grant Grant Thornton Thornton UK UK LLP. UKUK LLP, a limited liability partnership. Grant Thornton UK LLP is a is member firm firm within Grant Ltd (‘Grant (‘Grant Thornton ThorntonInternational’). International’).Grant GrantThornton ThorntonInternational International and member firms a worldwide partnership. Services are delivered GrantThornton Thornton International International Ltd and thethe member firms areare notnot a worldwide partnership. Services are delivered by by the themember member firms firms independently. B1667103 117x180.indd 11 B1667103GT GT Made Made to to Measure Measure 117x180.indd

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NEWS

WINTER 11

>> Boom, boom, it’s pharma

>> Westbound drive

It’s boom time at two pharmaceutical firms in the North East. Aesica Pharmaceuticals is out to build a lucrative European market with its first acquisition beyond the UK. And SCM Pharma is opening a US office with a business development manager to drive exports there. Aesica has bought from UCB three sites in Manheim and Zwickau in Germany, and Pianezza in Italy. The deal doubles the Newcastle firm’s capability and workforce, which will now total 1,400. It also represents the start of a strategic partnership with UCB. Chief executive Dr Robert Hardy says: “With these sites we extend and enhance our current offering and establish a presence in Europe.” Aesica, one of the UK’s fastest growing firms, has more than trebled sales from £25m to around £90m in five years. it recently opened offices in San Diego and New York and last June bought R5 Pharmaceuticals. SCM Pharma is opening a US office with a business development manager to drive the company’s export revenue. The Prudhoe firm’s move, which will promote its sterile manufacturing, follows its debut at an annual gathering of the American Association of Pharmaceutical Scientists in New Orleans, and the winning of a first US client. Managing director Dianne Sharp says: “Greater presence in the US market is a major step forward.” SCM Pharma also visited Japan recently on a UKTI trade mission.

Patrick Parsons, the consulting engineers is intensifying its nationwide remit by expanding more deeply into the North West. The Newcastle firm has appointed Chris Gooch-Butler as a business development director to lead the move into that region with more than 30 years experience. Gooch-Butler, from Chester originally, has spent most of his career in the North West, working with Gifford and Mouchel Parkman, and has led expansion for them in Dubai, Pakistan and East Africa. Patrick Parsons will retain its national remit.

>> Father to son Business adviser UNW has facilitated a family affair, one of its partners advising his son on acquisition of a County Durham dental practice. UNW partner Alan Suggett, a leading dental business adviser in the UK, has helped son Nigel, 27, make a £500,000 investment in the 80-year-old Robson’s Dental Practice at

BUSINESS QUARTER | WINTER 11

Family polish: UNW partner Alan Suggett with son Nigel. Seaham. Nigel Suggett acquired the 5,000 patient practice from its former owner and has rebranded it Seaham Smiles. He hopes fiancée Barbara McCammond, who is a children’s dentist, and mum Jane Suggett, a recently-retired trauma theatre nurse, may join the business. Experts at UNW in Newcastle carried out due diligence and secured the finance for the deal. Alan Suggett says: “Taking instructions from my son was novel. Nigel’s great grandfather was a County Durham miner and here he is now practicing in a former mining town.” Amanda Maskery of Newcastle-based law firm Sintons advised on legal aspects.

>> Virtual progress A Workington provider of packaging for many household brands has called in a virtualisation specialist in IT to bolster its business continuity. The specialist, Newcastle’s SITS Group, works alongside the in-house IT team at Amcor Flexibles Cumbria, applying virtualisation to boost the client’s IT infrastructure. SITS, based at Quorum Business Park, has recently doubled in size and now employs eight staff. It boosts computing power without investing in more servers, and will support in any disaster recovery situation.

>> Spreading the word A US firm has picked a North East translation provider to translate its user manuals and instruction leaflets. Cytori Therapeutics Inc is using Eclipse Translations of Alnwick to put the work into all main European languages.

>> Sherpa heads for heights Sherpa Business Consultancy, which helps others to become investor-ready and handle growth, has raised £2.2m for clients in its maiden year. The Newcastle firm raised the capital by combining private investment with some from the Finance for Business venture capital programme in the North East. Managing director Pete Watson says: “There is a lot of creative and digital talent in the region.” Sherpa specialises in high growth sectors and has seen rapid growth with digital technology, games, software and media businesses.

>> Offshore orders A&P Tyne is working on an order for a new offshore oilfield in Africa. It has to complete two subsea structures for a Total oilfield off Nigeria by March. The order has safeguarded 210 jobs at the Hebburn yard. Neighbouring McNulty Offshore has a £6m contract for an offshore wind platform placed by the Blyth-based renewable energy body Narec.

>> Sweet switch Nestle has announced a switch of production for its Toffee Crisp confectionery to its Newcastle operation, following its closure of a Yorkshire plant. About 60 more jobs may result on Tyneside.

WINTER 11

COMPANY PROFILE

Planning is key to safeguarding and building a business.

FAMILY BUSINESS LAWYERS POINT TO SUCCESSION SUCCESS

ATIMER Hinks solicitors, one of Darlington and County Durham’s longest established law firms, has a team of family business experts on hand to help drive companies forward. The firm has a commercial law team of experienced legal professionals who can provide the legal help and assistance businesses and their owners need. The team possesses high levels of expertise – levels normally associated with city based law firms. Approachable, knowledgeable and above all supportive, the firm prides itself on dealing with matters swiftly and to provide clear, concise and practical advice. Anne Elliott, a Partner at the firm, is a specialist in one of the key issues that all family businesses face: succession planning. Identifying a successor or successors in a way which ensures the best outcome possible is a major factor in the process. Anne said: “In this economic environment, succession planning is more important than ever. Business owners must take the best course of action possible to safeguard their business, their bottom line, cash flow, assets and workforce. “That might not necessarily mean handing down to a family member. It is a case of making the right choice for the future of the business and all involved, based upon solid, logical reasoning and professional advice, often being dispassionate and putting sentiment aside – family members may not necessarily have the right skills to take the business forward.” Anne says the first part of the process is always establishing what the desired outcome of the succession is. Then, a business owner should look at a plan for anything up to five years, broken down into stages, each with

Next step: Partners Nick Poole and Anne Elliott and their approaches to succession planning…..

SUCCESSION PLANNING IS NOT

SOMETHING TO GO INTO LIGHTLY, NOR IS IT SOMETHING THAT CAN BE IGNORED their own timescale. “You need to establish if the people you would like to take over the business have the right skill sets and abilities, then find out if the potential successors are willing to assume the role you have identified for them,” says Anne. “Once you know the direction you want to move, enlist expert advisers to make sure that any plans are legally watertight, are tax efficient and minimise the potential for challenge by or conflict among family members.” Anne added: “Succession planning is not something to go into lightly, nor is it something that can be ignored.” Another strand to succession planning is handled by Partner Nick Poole, who deals with shareholder agreements - referred to as “company wills”. Nick said: “The “company will” is an agreement we deal with on a very regular

basis. Its purpose is to get business owners to look at a number of “what ifs” covering lifetime and death situations. “Those “what ifs” apply equally whether the business in question is an LLP, Partnership or limited liability company. “In one case I know of, one of three business partners died. There was no shareholders’ agreement and it took 15 years for terms to be agreed for the purpose of the purchase of the deceased’s share in the business. “I have, over the years seen far too many business people who have lived to regret not having a “company will” (or indeed any will at all!). My simple advice is to make sure you deal with shareholder issues and your will whenever you go into business with anyone.”

For more information about Latimer Hinks’ services, visit www.latimerhinks.co.uk or call 01325 341500.

BUSINESS QUARTER |WINTER 11

AS I SEE IT

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YES, WE CAN INNOVATE The North East’s process industry at 25% is the largest segment in the region’s economy. Nigel Perry explains why there is good reason to feel optimism about it, even in these challenging times During this time of global economic uncertainty, it’s reassuring that innovation in the UK still prospers – and 2011 thus promises great excitement. Last year saw abundant change, advance and enterprise at the Centre for Process Innovation. With annual growth since inception in 2004 still beyond expectations, CPI has announced a number of forward-thinking and vital projects to drive forward the UK’s process industries, plastic electronics technologies and low carbon transition. It’s providing a vital gear in the UK’s wheel of industrial reform at a time when the country must build on its position as one of Europe’s great innovators. CPI offers market and technology expertise plus cutting-edge development assets to help its public and private sector clients build and prototype the next generation of products, processes and

CPI is providing a vital gear in the UK’s wheel of industrial reform at a time when the country must build on its position as one of Europe’s great innovators.

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services quickly, efficiently, and with minimal risk. Having designed and established national technology platforms in printable electronics and sustainable processing, CPI has development laboratories, prototyping facilities and pilot plants enabling clients to prove and scale up processes from laboratory stage to commercial reality. Scientists and engineers with commercial experience are there to offer expertise and guidance. There’s also a multi-disciplined team who work together on project management, investment and market opportunities to ensure each business fulfils its potential. CPI, as it continues to achieve tough goals and grow innovation, welcomes the Government’s proposal for a planned network of elite Technology Innovation Centres (TICs). Based on propositions by Hermann Hauser and James

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Dyson, it’s also a model CPI has implemented and championed in recent years. With more than £200m being invested by the Government over a four-year period, clearly here’s an area of key future investment. Further broadening its technology base in high value manufacturing, CPI has recently signed a memorandum of understanding with Tata Steel to establish a new High Temperature Innovation Centre (HTIC) on Teesside. With this £5m project, CPI will create an openaccess research facility centred on two new pilot plants to be installed on the site of Tata’s Teesside Technology Centre. The new plants will extend the site’s existing abilities to research and develop novel sources of fuel and energy, also the recovery of raw materials and reductions in amounts of organic waste produced. The equipment put in comprises a 350kg pyrolysis oven and a two-metre diameter, fully flexible gassifier. Beneficial to the HTIC is the ability to operate on a scale midway between theoretical, laboratory research and industrial production. So new technologies can be economically developed and proven on a meaningful and transferrable scale. CPI has also developed its Anaerobic Digestion Development Centre (ADDC) – the first of its type at this scale in the UK. It’s an open-access

AS I SEE IT

facility allowing firms to test and develop novel feedstock and technology combinations, with an aim of giving the UK a base to advance and develop new commercially viable processes and intellectual property in this particular technology. These new developments will run alongside CPI’s existing printable electronics and sustainable processing facilities, both of which were expanded last year. The national Printable Electronics Centre at Sedgefield has had a £20m boost with its ongoing expansion project. This will provide a further 700m2 Class 100 clean room – space giving full flexibility, varied toolsets, greater office space and a growing backbone of industry-renowned expertise. Last year also saw CPI’s industrial biotechnology demonstrator facility develop. This will stimulate the use of industrial biotechnology to develop and demonstrate processes that deliver viable products. The facility – tailored to the production of fuels, high-volume platform chemicals, low-volume speciality and higher value chemicals using renewable feedstocks such as biomass and waste – can also integrate chemical processing and bioprocessing. Yes, 2011 is a year of process innovation we relish. Nigel Perry is chief executive of the Centre for Process Innovation. n

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ENTREPRENEUR

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in association with

WHERE THERE’S A WILL THERE’S A WAY Will Ryles and his tiny team make bathrooms look different. He tells Brian Nicholls how one family’s life in the bush inspired the launch of a bold venture in home improvement here Will Ryles, though still only 23, lacks no inspiration as he drives his impressive business towards the end of its first financial year. His dad is a creator, his late grandfather was a resourceful administrator. And Will, as he explains intentions behind his impressive start-up Dovcor, shows both imagination and ingenuity of his own. His Sunderland firm designing and supplying bathroom suites and furniture promises, through him and two apprentices, to fill showrooms with elegantly styled and cleverly crafted products all competitively priced. As the

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pristine launch brochure puts it succinctly: “Bathe in luxury, without the luxury price tag.” Ryles is coping with challenges you’d associate with any young business. But he’ll hardly be caught in situations like his grandfather and father were. Grandfather Ernie was head of postal service in Tanganyika (now, with Zanzibar, called Tanzaniya). Born in 1910 at the main police station building in South Shields, where his father eventually retired a sergeant, Ernie passed exams and got to grammar school. Because his parents couldn’t afford ongoing education from there, Ernie at 16 joined the post office round the corner from the police station and worked as a telegram delivery boy prior to promotion. Then In 1936, supported by the head postmaster of South Shields, Ernie replied to an advertisement for junior postal controllers in East Africa. Out of 500 applicants, Ernie was one of five in the country to go. He was 26 and had to learn Swahili in six months or lose the job. He >>

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ENTREPRENEUR

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ENTREPRENEUR

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learned the language and in time had 2,000 people working for him. Inevitably, personnel issues could require unorthodox responses. After a lion ate one of Ernie’s messengers for dinner, the runners – used where no roads existed – were issued with rifles and a pack of bullets. But when they repeatedly came back with no bullets Ernie had them followed and discovered they were shooting game to distribute in their villages. So he issued them with only two bullets which they had to sign out and sign in. An employee asked: “What happens if I come up against a lion?” Ernie replied: “You shoot it.” He asked: “What happens if I come up against a second lion?” Ernie replied: “You shoot it.” The employee said: “What if I come up against a third lion?” Ernie said: “Well, you run.”

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There were calls beyond duty too. Ernie and Will’s father Howard, who was then nine, were asked by the district commissioner for Mehengi district to help him dispose of a rogue elephant that was trampling villages and had killed a young African. The commissioner placed Ernie and Howard where the elephant emerging from the bush would see them. It duly appeared and charged. The commissioner fired his elephant gun but the elephant kept coming. With militant African nationalist movement Mau Mau then active, Howard had been taught how to shoot at the age of eight but tells BQ today: “I did a quick run to the right, fearing the worst, my pistol still out of sight.” Ernie fired, however, and the elephant stumbled and crashed in a dust cloud 20 feet from the party. Though in public service, Ernie had entrepreneurial instincts too. As there were no

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fresh eggs there then, he had 150, day-old chicks flown in from South Africa. Eggs became plentiful. One night in the pen there was massive commotion and flying feathers. Ernie and Howard ran out in their pyjamas with pistols, hurricane lamps and a panga knife. Calm was restored when Ernie chopped the head off an eight-inch diameter python. Ernie’s hospitality was recognised at the highest level. One day the district commissioner drove up to Ernie’s home with four witches manacled to the rear of his vehicle, and evidence to hand that babies had been boiled for their fat. Ernie’s servants fled for a week on seeing the witches. But the district commissioner, unperturbed, stopped for a glass of beer before leading the witches on towards jail and a murder trial. Bathrooms such as Will provides in the North East now would probably have been beyond the imaginations of the expats in Dar-es-Salaam. They’re all English design, and Will explains the advantage of that over mainland European products. “Most big companies from the continent come over here and impose their own furniture design on the UK,” he says. “But the UK’s post-1950 housing stock has small bathrooms. So we design furniture suited to the UK and modular so it can be fitted together in a variety of ways within whatever space is available. Only a few places will build the kind of furniture we want, with curves and quality finish. So we go to factories in Italy for our manufacturing. “We make a big thing about our products being made in Italy because a lot of bathroom furniture these days comes from China and the Far East and isn’t always as good in quality. So between design and manufacture we offer a high quality European product.” There’s another attraction. Whereas furniture from abroad may cost £800 to about £1,200, Will says his furniture starts at about £500 rising to £700. It has a painstaking quality too. “We’ve a key theme in our design and relate it to the entire product,” he says. “Some of our furniture is already into a third version as we improve and improve.” Howard, a distinguished designer now living

ENTREPRENEUR

There are only a few places that will build the kind of furniture we want, with curves and quality finish. So we go to factories in Italy for our manufacturing

Irrepressible: Grandad Ernie Ryles, who excelled as head postmaster in Dar-es-Salaam

near Preston, owns half the company but contracts for it. ”I deal with everything,” Will explains. “I commission his designs. I take a drawing to my dad and say: ‘Can you design this and make it look nice?’. He’s amazingly gifted. He probably changed the face of English furniture but others took the credit. So he went freelance 20 years ago and freelances for a number of clients today.” Ernie had been the life and soul of Dar-esSalaam parties, a renowned singer of Geordie songs on Tanganyika Radio, and taking a leading Gilbert and Sullivan role with Dar-es-Salaam Players. But as expats sometimes find, his return home wasn’t quite so rollicking. He’d applied for an even higher job in Dar-es-Salaam but it went to someone through rank and privilege. He warned the powers beforehand their decision was flawed since he was best for the job – but the decision stood. Ernie retired and the family packed their goods and chattels. Six months later the individual preferred shot himself. Ernie declined to take the job second time round, returned to the North East and worked again at the South Shields post office. It was now hardly what he’d been used to, so he bought Haltwhistle post office and moved there. Thus Will’s father, born near Lake Victoria in 1945, was 12 when he came to England with the family in 1957. He soon found Africa’s education levels had been below those of boarding school here, so he had to recover a lot of ground, except in Swahili, which Will thinks he probably wrote in and spoke better than English then. Progress was made, though, and Howard later commuted to college in Newcastle to study design. He won awards and became design director for a number of companies including G Plan. Another age, another generation... At their home, a 1700s converted barn at Haighton near Preston, Will had helped his dad sort out his bills since he was 12. Will reckons, despite that, he himself was the laziest, most laid-back pupil at school. But he got to Newcastle University where, despite failing maths which he hates, he resat and got 97%. He graduated in economics and business >>

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ENTREPRENEUR

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People could do you over for a thousand pounds and you wouldn’t be able to get it back. There’s a massive link between then and now

management, then considered the future. “My dad’s always been in furniture and I never wanted to follow my dad’s footsteps because I’m a very independent kind of person,” he says. “I wanted to start my own business, though. I thought: What can I go into? I’d watched my dad every day for 18 years, the best designer I’ve ever seen. “So I thought: ‘Why not utilise him and I’ll go into kitchens?’ Then I realised kitchens might be expensive to go into so I thought of something smaller – bathrooms.” He registered the company which operates from De Vere House, Riverside Drive in Sunderland, then spent two years planning. The recession hit at take-off. But Will had learned from his dissertation on Chinese marketing theory in the 15th century. Credit had dried up then too after years and years of people ripping each other off. They in the end had gone back to a more honourable time when a handshake meant something. “Basically,” Will warns, “it was about how contracts were not enforceable. People could do you over for a thousand pounds. There’s a massive link between then and now.” So far about £330,000 is invested in Will’s business at a time when many banks, he finds, aren’t prepared to back a 23-year-old entrepreneur. While a lot of cash has already come from the business itself, he acknowledges his parents’ help, and an

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inheritance from his adventurous grandfather who inspired his sense of independence. He’s convinced if his business tried to sell through national chains its profit margins would be driven down massively.

“They’d also tie us to contracts where they could pull out leaving us with a lot of unsold items,” he says. Preferring smaller trade customers, he inclines towards plumbers’ merchants which, like his company, are North East rooted. He also plans to have a sales team to promote Dovcor in similar outlets nationally. There’s no direct selling online – “that would go behind our trade customers’ backs” – but people can get information and find a local stockist there. If they phone they’ll probably talk to Will. He deals directly with sales, importing, warehousing, product design, brochures and website because, as he says: “I’m absolutely passionate about this business. I love my job and wouldn’t change it for the world.” He’ll be getting a lot of correspondence to answer as well. But perhaps nothing quite like the telegram his grandfather Ernie received. Referring to one of his upcountry mail runners, it read: “Sorry to report runner taken by crocodile on lake shore. Pleased to say mail OK and new runner in place.” n www.dovcor.com

Young entrepreneurs unite Already an enthusiastic member of the Entrepreneurs’ Forum, Will Ryles is setting up with three others like himself a Young Entrepreneurs’ Trust. He says: “It’s a lonely world when you start a business young. Universities don’t teach you about dealing with people. I felt there should be another group bringing together bright young sparks of the region.” A programme of monthly meetings is being set up. And Will, who already works voluntarily with Young Enterprise and Just the Job incentives in Sunderland, hopes that as more young entrepreneurs join they’ll start a mentoring of 16-year-old apprentices so that by the time the mentored are 18 they might set up a business themselves or at least feel more employable. Will, who is mentored himself at the Entrepreneurs’ Forum, with which this trust is not directly connected, says the Forum does a great job encouraging young people, particularly through its If We Can, You Can campaign. “We would try to complement that,” he says.

The Entrepreneurs’ Forum’s 350 members – from all stages of business growth and all passionate about what they do – are willing to share their knowledge for the benefit of others, providing unique access to a wealth of collective experience. This is harnessed to create real value through a variety of events, mentoring and instruction from the practitioner’s perspective. To find out more please visit www.entrepreneursforum.net

WINTER 11

COMPANY PROFILE

Just over 12 months ago the UK was coming out of the longest and deepest recession it had experienced since the 1930s. As we begin a new year it may be worth evaluating how your business is performing and considering the steps you can take to get it into shape for 2011.

GETTING YOUR BUSINESS INTO SHAPE

HILST interest rates remain at historically low levels and the labour market has been remarkably resilient, there are several drags on the UK’s economy which suggest the rate of growth will be modest during 2011. Consumers account for the largest portion of demand in the economy but their high levels of borrowing mean their household balance sheets will need to be addressed and this will reduce their capacity to spend in 2011. Tax and VAT rises will also bite and restoring balance to the economy will take some time as spare capacity in the labour market means that growth will be modest. These factors will ensure it will take about two more years before we recover the ground lost in the recession. Most businesses have already taken a long hard look at non essential expenditure. Costs have been cut, non core activities run down or disposed of and in many cases investment deferred. But now is probably a good time to revisit your plans, as we adjust to the changing trading climate. In particular it’s worth addressing the following points: Take a step back – Revisit your business plan and ensure that you have a clear picture of what is happening to your company at present. Be honest, don’t kid yourself and be prepared to ask some tough questions. Have a “plan B” in case events take a different turn – be it funding options; alternative suppliers; different routes to market. Examine every aspect of the business including your management team and ask are they still the right people for the circumstances? If you need to bolster the team would an experienced non executive help? A robust financial model is essential to make informed decisions – You need to be able to stress test your business. Ensure you know your exact break-even point and examine the impact of lower prices and narrowing margins. Do you need as

existing and new customers if it is to survive. Marketing is one way this can be achieved. Get to know existing and potential customers and then tailor your marketing efforts to meet their needs. Evaluate the effectiveness of your marketing channels and don’t be afraid to explore alternatives. New markets (both domestic and overseas) will open up as existing players change focus or exit traditional markets, creating opportunities for local business that are able to capitalise. Forward planning is the key and NatWest has launched an SME Business Knowledge Hub to help local companies trade more effectively during 2011. The hub, which can be accessed online at: http://support.natwest.com is a one stop shop full of useful tools and resources. These range from a free online review of your business to specialist advice on exporting and how to access different types of finance. Peter Sleigh, Regional Director, North Region Commercial Banking much stock? Reducing this will help release cash. Can you renegotiate contract or payment terms? Can you improve your credit control? Less conventional types of finance such as invoice discounting can provide an ongoing stimulus to cash flow. Are you making best use of the different advice that is available? Don’t be afraid to ask for help when you need it. Talk to your bank, accountant or other professional advisors – the sooner you make them aware of a potential problem the quicker they can respond. You should also take advantage of the free advice offered by public sector bodies to explore the range of public sector finance available for your business. Don’t put a stop to your marketing activities, however ensure that any activity is focussed and offers value for money. A business needs to maintain excellent relationships with both

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For further information please contact: Peter Sleigh, Regional Director, North Region Commercial Banking Tel: 07901 588031 Email: peter.sleigh@rbs.co.uk www.natwest.com

BUSINESS QUARTER | WINTER 11

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The Big Society flexes its muscles, a tyre firm is on a roll, engineering thrives in Cramlington, the pub sector gets a timely investment boost, there’s new life on Hadrian’s Wall, and Semichem scrums down >> Five ride the Metro Five construction groups look set to share in the £385m modernisation of Tyne and Wear Metro. The system’s 41 million passengers a year will benefit from new stretches of track, power lines, signalling and stations over 11 years. Refurbishment of all 90 carriages is already under way. The firms awarded framework agreements by Nexus to date are Balfour Beatty Rail, BAM Nuttall, May Gurney, Serco and Morgan Sindall. They will compete for packages of construction and engineering. Some £38m is expected to be spent immediately. Track improvements include a 10km stretch Tynemouth and Byker, dating back to 1838 and part of the world’s oldest commuter railway. DB Regio Tyne and Wear operates stations and trains for Nexus, under a concession of up to nine years from last April.

>> First into Durhamgate Sedgefield Borough Homes, County Durham’s largest social housing provider, will be an early occupier of Carillion and Arlington Real Estate’s £200m Durhamgate scheme, near Spennymoor. Construction is under way and the homes group’s 170 staff could be working at their new headquarters by the end of 2011. The company, set up in 2009, is responsible for 8,500 homes. Durhamgate is a 60-acre mixed development coming up on a former Black & Decker site. There will be 440,000sq ft of offices, a hotel and family pub, 20,000sq ft of restaurants, 9,500sq ft of retail and 376 new homes. Allan Cook, director of Hartlepool-based Arlington, says: “We’ve used private investment to drive forward through the current economic climate.” Watson Burton law firm advised the developers.

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Big Changes: Sean Hedley

>> Planning turned on its head

Planning as we know it has been turned on its head with publication of a long-anticipated Localism Bill – part of the coalition Government’s overall Big Society strategy. It aims to move power from politicians to local people and communities. Incentives will be introduced to persuade councils and other public bodies to co-operate one with another once regional development agencies have gone. Planning Inspectors will no longer be able to rewrite local plans, but will still publicly assess them. Councils must also publish up-to-date information on planning documents they are preparing. Communities could then allow development without need for planning applications, so streamlining decision making and removing barriers to development. Developers must now check with community groups before submitting planning applications, and organisations will have limited ability to appeal against planning refusal. Sean Hedley, partner and planning specialist at chartered surveyors Sanderson Weatherall, says: “The plans are creating a lot of buzz. Success will depend on the individual community groups and their ability to raise support from locals and ensure the necessary funding is put into place. “Some exciting opportunities are certain, though the true extent of the changes will not be known until they are put into practice.”

>> Back in favour Middleton Enterprises, run by North East serial entrepreneur Jeremy Middleton, is pepping up Bede House at Belmont Business Park in Durham. A flagship building in its portfolio, it was left empty after the tenant went into administration. Now the premises has been revamped at a cost of £300,000 and are home to three companies: Jordan Valley Semiconductors, Wind Services and Durham Primary Care Trust. One 3,000sq ft unit remains.

>> Tramsformation The former Manors, Newcastle, depot, from which tramcars were once powered, has had a £1m restyle from owner, City Church, which bought it from Stagecoach. A hall that housed power turbines is now an auditorium seating 550 for church services and other public functions. The listed building, renamed Castlegate Centre, is 108 years old. >>

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COMMERCIAL PROPERTY

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>> Duke’s enterprise

Prime site: Left to right, Paul Alexander, James Devany (Sanderson Weatherall LLP) and John Alexander

Work is starting on phase three of Northumberland Park’s retail park situated beside the Sainsbury’s outlet at the Metro Interchange of the same name. The Duke of Northumberland’s firm Northumberland Estates is the developer.

Spaced out: Tim Darcy, general operations and logistics manager for NE Wholesale, foreground), with warehouse manager John Colley at the new 69,000sq ft storage facility

>> Tyre firms on a roll The tyre business has a firm tread in the south of our region. Two companies have announced major expansion. North Eastern Tyre and Exhausts (NETE) is making a major investment in Stockton, while Darlington Tyre and Auto Centre is making a big financial commitment in the town of its name. NETE is pumping £2m into its wholesale division, NE Wholesale, to provide for stocking of almost quarter-of-a-million tyres, spanning thousands of product lines. The retail and wholesale distributor of tyres and exhausts has acquired a warehouse in Stockton, at 69,000sq ft, almost the size of two football pitches. Tim Darcy, general operations and logistics manager for the wholesale division which has five outlets across the North East and Yorkshire, says: “This massive storage space will complement our current wholesale storage sites.” NE Wholesale has twice been named Regional Tyre Wholesaler of the Year. It and its retail division have been established for more than 40 years. Between them they employ more than 370 people. Meanwhile, Darlington Tyre & Auto Centre is investing £1m with the recent acquisition of a key site for its new vehicle centre in Darlington. Sanderson Weatherall sealed the freehold deal for a 17,000sq ft site previously occupied by a Co-Operative Group filling station. The site fronts Parkgate, leading onto Yarm Road, one of Darlington’s main routes. John Alexander, a partner in the family firm, says: “We employ more than 50 people at Peterlee and Teesside. This third outlet enables us to take on 15 more employees.”

>> Plough’s new furrow Tavistock Leisure has invested more than £400,000 in its recently acquired Plough Inn at Mountsett, near Burnopfield in County Durham. Staffing has doubled to 16 and the gastro pub is under the tenancy of Dave and Lynn Meldrum, who ran business there in the 1990s. The group also runs the Best Western hotels in Sunderland, Middlesbrough and Hartlepool – and the Alexandra pub in Sunderland.

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>> £340m tourist lure Private investors are being offered entry to a proposed joint venture for a £340m project aimed at drawing more tourists to Haltwhistle and the wider area of Hadrian’s Wall. Northumberland County Council and Hadrian’s Wall Heritage Ltd envisage the development on a 7.5-hectare site beside the A69 between Newcastle and Carlisle. A hotel and restaurant, filling station, commercial workshops and visitor centre would aim to attract business from the nearby road used by about 10,000 vehicles daily.

>> Engineers tool up Thriving Osborne Engineering has extended its facility at North Nelson Industrial Estate, Cramlington, adding 45 more names to the 125 already on the payroll. The company makes bespoke bearings and gas turbine parts for clients in the oil and gas, wind power and power generation industries. The expansion has been helped by a £350,000 grant from regional development agency One North East. Group managing director Shukri Benfaied says: “The extension is preventing valuable work from being lost to competitors in Europe. It is also allowing more space to bolster other services.”

On show: Allison Harmison of Darchem and David Walker of Picture Farm at the new exhibition centre

>> Curtain up on Darchem Darchem Engineering now has a large exhibition centre from which to show visitors its product range at its Stillington, Teesside, headquarters. Now part of global engineering giant Esterline, Darchem produces engineered solutions to high temperature/ thermal engineering problems. These serve aerospace, naval, nuclear and other markets.

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It supplies parts for the Aston Martin 177, Airbus A380, Type 45 Destroyer and the Eurofighter Typhoon among others. Picture Farm, the award-winning photography and podcast company in Gateshead, has created video displays for the centre. Besides the main showreel filling a large screen, Picture Farm has produced separate podcasts that are displayed around the centre.

COMMERCIAL PROPERTY

across the region over 18 months. The home will provide breaks for under 65s reliant on daily domiciliary care.

Spectrum: Competitive charges are attractive

>> Galleries smartened

>> Rent-free incentives

>> Seafront facelift A £1.25m investment to revive a derelict building on Whitley Bay seafront could create 30 new jobs when the building reopens as a respite home next August. The former Burnside Lodge care home is now owned by Northridge Care, a Newcastle firm whose managing Winch sees1/4/08 it 165530 TWDC director EutechNeill 180x120 as the first of a string of sites to be acquired

Consultants, and Colliers International are quoting the example to persuade others towards the space remaining. Robert Patterson, a partner at Sanderson Weatherall, says: “The park has been designed with benefits of Grade A office space but not the sometimes higher price tag.” Hillford Group is the developer.

Durham County Council is one of the latest tenants availing of rent-free incentives at Seaham Business Park. It now has its East Durham base in Spectrum 8, a 30,000sq ft Grade A office building. Estate specialists Sanderson Weatherall and1joint agents, SRG Property 12:11 Page

A £10m spruce-up is under way at the 36-year-old Washington Galleries retail centre.

>> Trainers relocate CableCom Training now operates from a new, purpose built, £2.1m training >>

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BUSINESS QUARTER |WINTER 11

COMMERCIAL PROPERTY centre on the new Westland Way Development at Preston Farm, Stockton. The firm formed 10 years ago operates in telecoms, electronic security systems, transport and logistics, health and safety and general security. Managing director Tony Horridge plans to help develop a virtual learning centre for armed forces deployed on operations.

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total workforce of 200. The company is merging its existing London and Newcastle offices, and has taken a 10-year lease on the first floor of Q5 block. AIM-listed Ebiquity has been installing staff in two phases.

>> Retail plan put off An application by ING Estates for a £24m expansion of Dalton Park retail park off the A19 at Murton, was deferred by County Durham planning authority.

>> World-class centre Merchant Place Developments of Newcastle has won a world title in the UK Property Awards for its work on the Expro Subsea Excellence Centre building at Ulverston in Cumbria. The building, occupied by Expro Tronic Connectors, also won best industrial development award.

Welcome party: Left to right, Paul Adams and Harry Cowan (both Ebiquity), Paul Buie of Tyne and Wear Development Company, and Quorum development director Fergus Trim

Kick-off: Semichem store manager, Julie McAndrew celebrates the official opening with players from Blaydon RFC

>> World-class centre

>> The new neighbour The newest arrival at Quorum Business Park on Tyneside has been moving its key players in. Ebiquity, a media monitoring firms, is the latest inward investment there with a leasing of more than 18,000sq ft. It is pumping more than £1m into the relocation to create a world-class processing centre, creating 60 jobs and a

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Great strapping rugby lads joined the opening celebration when Semichem, the discount health and beauty chain, opened a store in Blaydon’s shopping precinct. The players, first-team members of the Blaydon club, joined Julie McAndrew, store manager, and Gail Thornton, Semichem’s regional business manager, to welcome the first shoppers. Tom Rock, a Blaydon rugby club director, said: “It’s a privilege in these difficult times for the club and the people of Blaydon to welcome Semichem to our town centre.” Semichem chain, part of Scotmid Co-operative Society, has more than 140 stores, 12 of them recently opened in the North East.

>> A place to meet Developer NG1 is leading a bid for backing from the Regional Growth Fund for support to build an international conference and exhibition centre beside The Sage in Gateshead. The group, tasked with regenerating parts of Newcastle and Gateshead, estimates the venue would

bring in £19m annually, support up to 3,000 private sector jobs, and attract 215,000 more delegates.

>> Accolade comes North The Newcastle office of King Sturge has won the accolade of National Property Adviser of the Year in the Estates Gazette Awards. >>

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COMMERCIAL PROPERTY >> Agent in a thousand

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>> The public sector shakeout

A two-year-old property group in Easington is among largest letters in the North East after taking over another rental agency with support from Business Link. Castledene lettings, construction and management agency, owned by John Paul, has nearly 1,000 properties on portfolio after taking over Seaham-based Interlet. It employs 25 staff and is now also acquiring Weardale-based Better Value Lettings.

>> New keyholder at The Gate A £900m deal has seen Newcastle’s entertainment centre The Gate change ownership. Jamie Ritblat’s London-based Delancey made the purchase as part of an acquisition of the Blade portfolio from Prop-Invest Group. No immediate changes or job losses are expected. The venue includes a casino, 12-screen cinema, and 17 leisure units.

>> Another Link Business Link has opened a local office for eight advisers to work from at Lingfield Point in Darlington. Another recent newcomer is Fifteen Digital. Headed by John Borthwick, online marketing manager who is back to his North East roots, this firm has divisions in IT, web development and online marketing. The Darlington office offers the marketing. Borthwick says: “Our aim here is to replicate in the North East our success in the West Midlands.”

>> Everything’s Rosie Rosie’s Bar, a favoured neighbouring drinking haunt on Newcastle United’s match days, is getting a £150,000 makeover under its joint venture operators Punch Taverns and Leopard Leisure. The latter is a family firm running five venues led by Harry Costigan, one of 14 shareholders of Pubmaster who became millionaires in 2003 when the Hartlepool group sold out to Punch Taverns.

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“Growth in occupied space is the smallest among the major markets.” The increase of occupied stock in Newcastle is thus predicted to be 1.2% between 2010 and 2014. Over the past 10 years the city saw a rise in public administration of 12% against a UK average of 7%.

>> Council bosses hesitant Serious concerns: Paul Scrafton

>> Newcastle may miss out Occupied space in the UK office market is set to grow, despite the slashing of public service jobs. Newcastle could miss out, however. Global real estate adviser DTZ expects the total in major markets to rise by 2m sq m by 2014, with strengthening demand from a recovering private sector more than outweighing effects of the Government’s decimation of the public sector. But it will be the like of London, Bristol and Leeds that benefit. DTZ says cities like Newcastle, Cardiff and Birmingham look more vulnerable because a greater proportion of office workers are in public administration, and jobs growth in finance and business services may be weak. Tony Hordon, director at DTZ Newcastle, says: “Across major office markets, Newcastle looks one of the most vulnerable.

A survey indicates 42% of local government bodies are missing a chance to save millions of pounds by not collaborating to use assets efficiently. This is despite a belief among most senior local government officers that collaboration can be a cost-cutter. Real estate specialist DTZ, which advises one in three local authorities and more than 30 central government departments on property, held a survey made of more than 100 key decision makers in local government and findings show almost half of the bodies checked have yet to formally introduce a collaboration programme, which might otherwise help protect frontline services. Paul Scrafton, a public service director at DTZ Newcastle, says: “Some 71% believed collaboration can occur without intervention from Whitehall. If it doesn’t happen soon for one of local government’s most identifiable and manageable overheads, serious concerns will arise about its ability to adapt to life after the Government’s Spending Review.” One in five senior officers of local government sees collaboration as a threat to their organisation.

>> Landmark block transformed A £1m injection has transformed an office block in the heart of Darlington. Local firm Niven Architects has refurbished Beaumont House in Beaumont Street, the former base of RAC Insurance. It is now serves Charles Tompkins as headquarters of Tompkins UK, his sub-sea engineering, technology and investment business. Modus, the sub-sea construction subsidiary of Tompkins UK, will also relocate to the newly bought building. Simon Crowe, director of Niven Architects, hopes the refurbishment will catalyse that part of the town centre.

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COMPANY PROFILE

ENTERPRISING THOUGHTS Two reports on the news recently gave me food for thought. The Q4 economic results were published showing the UK economy had shrunk overall by 0.5%, although manufacturing rose 0.9%. The second report related to Sir Richard Lambert’s comments as he gave one of his final speeches before retiring. In it he argued that the government should do more to outline its plans to support economic growth, rather than concentrate on explaining, yet again, its cuts strategy. What is clear from both these statements is that, particularly now, there are two sides to every story. Talking to companies in East Durham, some have weathered the recession and are gradually looking forward to lengthening order books, whilst others still see things as very short term. Things therefore are both unpredictable

and fragile at the same time. That is why Sir Richard Lambert is right to say that, against this background and with significant downsizing of the public sector looming, the government needs to say exactly how it sees the private sector being stimulated in order to create additional jobs. The stimulation of enterprise is key to this and I believe there are opportunities out there if individuals want to take them. With downsizing of the public sector there will be many facing the unenviable prospect of redundancy who already have a business idea or want to work for themselves – they need clear signposting to those who can help them find their feet and successfully develop their new business into one with a sustainable future. Enterprise Agencies, of which there are 11 across the North East have been fulfilling this role for

over 30 years in many cases and at all states of the economic cycle. We therefore don’t even have to reinvent the wheel. Using existing organisations such as these not only will improve the chances of new businesses and therefore new jobs being created to replace those lost, but using them will also sustain the important support which regions such as ours need to develop a successful economy in the future. Now that would be enterprising. Peter Chapman, Chief Executive

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BUSINESS QUARTER |WINTER 11

INSIGHT

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Teesside created a stir – a sense of betrayal, some might even suggest – in many other parts of the North East by its speed off the mark to form its own Local Enterprise Partnership. John Irwin, who knows Teesside better than most, answers Brian Nicholls on how he sees its future First, what do you feel are achievements that Teesside can be most proud of over the past decade? Having watched Newcastle United beat Ujpest Dozsa in 1969, I found it a great achievement for the Boro to be the North East’s most successful football team for more than 30 years by winning the League Cup and reaching a European cup final. It’s also a great achievement to have survived the demise of BSC and ICI and, despite predictions of meltdown by informed and well-educated observers, to have adapted and thrived and retained strong petrochemical and heavy engineering industries of international importance. The reopening of the Redcar blast furnace later this year will be a huge confidence boost to the area – it’s an iconic feature of the area that founded the steel industry. As a governor at Teesside University, I have a vested interest in enjoying its successful transformation into the first modern university to become University of the Year in 2009. What are the biggest factors impeding further commercial development? The lack of new commercial and industrial

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IN THE NAME OF PROGRESS property in the future is a real problem for the region. At Storeys:ssp we believe a low level of demand, a general oversupply of often inadequate buildings, market values lower than the cost to build – together with very limited finance available for property – means speculative development is virtually nonexistent. It will take some time before this changes without direct help. Is the Government’s decision to slash £18m out of the £60m Tees Valley Industrial Programme a major blow, or was it to be expected given that a reprieve to the steel industry looks likely? Very few actually believed the £60m was new money and available in the first place! While its loss is disappointing, it is generally believed the larger infrastructure projects proposed related to the heavy engineering and petrochemical process industries, which are important nationally and if necessary, funding can still be made available – perhaps through the Regional Growth Fund. Are you optimistic that ongoing progress will be seen under the initiative of the new Teesside Local Enterprise Partnership? It seems, every 10 years or so, new initiatives come along without regard to what did and did not work before. Development corporations, enterprise zones, regeneration agencies, development agencies – now local enterprise partnerships. The LEPs, however, are different. They’re effectively penniless and powerless. While nominally they’re business led, their effectiveness will be largely determined by the enthusiasm of the local authorities. There remains a need – political spin notwithstanding – for sub-regional and regional leadership with a clear vision of the future and how to achieve

it. This has to be shown by actions rather than words. The jury is out as to if, and how, the LEPs can provide that difference. What will be the biggest obstacles, in your view, that the LEP will encounter? I think the expectation level from business as to what they can do. Irrespective of effort and remit, they’ll inevitably be judged by the previous regeneration and economic bodies, many of which were perceived to have over-promised and under-delivered, so there’s goodwill around for them. In these financially hard times, local authorities must be seen genuinely to be working together, delegating responsibilities, merging and sharing common services. It is now self-evident that on Teesside, we don’t need five of everything from the councils for such a relatively small and compact conurbation. Do you think it likely and desirable that Teesside under the new regional development system should remain in close contact with the rest of the North East region? Teesside plays an important part in North East life. That the river-based industries, engineering and petrochemical processing are of national standing means Teesside is complementary rather than competitive to the rest of the North East – often not understood in the Tyne and Wear area. It’s as easy for Teessiders to go to Leeds and York as to Newcastle and Sunderland. The strong identity of the Teesside LEP will be crucial in helping the North East Economic Partnership (NEEP) to succeed, which in turn is vital to help the region stand up for itself in the future against fierce competition elsewhere in the North – especially in Leeds and Manchester areas. >>

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INSIGHT

It seems, every 10 years or so, new initiatives come along without regard to what did and did not work before

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INSIGHT

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The region should never have had two airports, which are now both in the wrong locations. One of the biggest strategic mistakes was not to develop Sunderland Airport How damaging is it to Teesside that its airport should be losing flights, passengers and revenue? Retaining Teesside’s airport is crucial to supporting the international based engineering and petrochemical process industries. It also, still, has great potential to develop as an air freight terminal alongside the growing success of Teesport. The owners did not help its progress by the confusing name change to Durham Tees Valley, which also alienated its home market. Teesside still is a worldwide renowned brand name within the engineering and petrochemical sectors. The failure of the name change and the self-inflicted damage is self evident to all who use it. It’s also another example of the importance of regional co-ordination – pertinent to the NEEP. I feel the region should never have had two airports, which are now both in the wrong locations with green fields, sheep and cows to the north of Newcastle and south of Teesside. One of the biggest regional strategic mistakes was not to develop Sunderland Airport, between the main conurbations and between the A19 and A1 and with good rail links – a huge missed opportunity born of parochial vision. Do you think the trend is reversible? The trend is reversible but will be slow and painful with the predominance of Newcastle and the increasing investment at nearby Leeds Bradford. There needs to be strategic support for the freight terminal hub and essential business routes. Does Teesside need a Metro rail system or will the recent government cash injection for bus transport meet future needs? I have consistently said the Tees Valley Metro always was unachievable and not needed.

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Proposed by Tees Valley Regeneration – with a vested interest to link their failing regeneration sites in the central core – the scheme ignored the new growing and successful business and residential areas such as Wynyard, Preston Farm, Ingleby Barwick, and Coulby Newham located on the urban fringes. Enhanced bus transport was always the way forward. Sadly, we lost too much time chasing impossible and unrealistic dreams. Has Teesside disadvantaged itself nationally and internationally by adopting a variety of names over the years: ie, Teesside, Tees Valley, Cleveland? The Tees Valley brand was a local authority inspired justification for the 1996 reorganisation of local government. It is mainly ignored – apart from those connected with local government and in receipt of their money. Most businesses, like Storeys:ssp, retain the internationally-known brand Teesside. Sadly, it’s also an insult to those who studied geography; Teesside is within an estuary, as those from Hexham in the Tyne Valley, Bishop Auckland in the Wear Valley will testify and Barnard Castle will wonder about. Is the region’s leisure sector sufficient for needs? The leisure sector reflects the demands and needs of its population. This in turn acknowledges that the North East has a small population and a large geographical area. I have no complaint about living in the North York Moors National Park and being close to so many others. What do you see as the main strengths and weaknesses in office, retail and factory/warehouse availability? There’s a fundamental conflict between the strengths and weaknesses in the market availability of office, retail and industrial

property. One of the main strengths is the relatively low cost base compared to other regions. This, however, is also one of its weaknesses as it doesn’t stimulate or encourage speculative and bespoke highquality buildings. One of Storeys:ssp’s concerns with the demise of so many agencies is what will become of the physical assets of One North East regional development agency, which have been set up and accumulated to support vital sectors of the region’s economy and assist regeneration? This is further complicated by the fact that, because the North East property market is so diverse and specialist, it’s notoriously difficult to understand and interpret. Storeys:ssp has been able to maintain a Teesside office in Middlesbrough for more than 50 years for just that reason – and long may it remain so! n John Irwin, a director of Storeys:ssp, was president of Teesside Chamber of Commerce then helped form, and became president, of the North East Chamber, where he’s now vice-chairman of the executive board. He has chaired Teesside Tomorrow and started its professional firms group. He has helped implement regeneration in Middlesbrough as a director of the Town Centre Company. Currently, he’s a trustee of the Tees Valley Community Foundation and chairs Teesside University’s Audit Committee. His career began in 1970 as a surveyor with Storey Sons and Parker in Newcastle. Having married Sarah, a Sussex nurse, and studied at university in London, he almost joined a venture there, but instead accepted a post in Teesside, an area that had seen Europe’s largest level of industrial investment. But it was 1979 – the start of repeated recessions and industrial change. With colleague Ian Battle, however, John has grown the office fivefold. He was one of Storeys’ “gang of six” who bought the company in 1991 and has done much to make it a leading North East independent.

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COMPANY PROFILE

TVU has supported bids from companies in the processing and renewable industries and other important sectors to the region, including transport and housing.

LEPing INTO ACTION W

EES Valley Unlimited, the ITH AN ANNOUNCEMENT ON region’s public and private sector THE SUCCESSFUL BIDS DUE IN partnership, is convinced its SPRING WE ARE NOW TURNING successful bid for Local Enterprise Partnership status will be a OUR ATTENTION TO ONCE AGAIN springboard to an ambitious investment WORKING WITH OUR PUBLIC programme. AND PRIVATE SECTOR PARTNERS The organisation’s newly-appointed TO PREPARE SOME EQUALLY Managing Director, Stephen Catchpole, believes the LEP - one of only 24 created EXCITING BIDS FOR THE nationally - will play an essential role in SECOND ROUND helping to tackle Tees Valley’s “unique challenges”. fund and how it can benefit companies. And the new organisation has already He added: “There are also some really take one of its first positive steps – by exciting projects which have seen the helping companies to apply for funding public and private sector collaborating – in the first round of bids from the £1.4b something we believe is crucial to the Regional Growth Fund (RGF) announced growth of Tees Valley’s economy. by the Government last year. “The LEP will work with partners to TVU has supported bids from companies tackle obstacles to private investment by in the processing and renewable streamlining planning, seeking to industries and other important sectors to introduce tax incentives and capital the region, including transport and allowances and simplifying processes housing. with regulatory authorities - all of which Stephen said: “This first round of bidding will help unlock a forecasted £8bn was very much aimed at those larger investment in the area and further Stephen Catchpole, Managing Director of Tees Valley Unlimited. projects which required substantial stimulate the local economy. (Below} Cavendish House, Tees Valley Unlimited’s head office. expenditure and I’m pleased we been “We need to be close to our local able to work with and support a number of communities and ensure they have the skills to private sector bids which have enormous benefit from opportunities created by the potential to create significant jobs and private sector,” said Mr Catchpole. investment in the area. “With an announcement on the successful bids due in spring, we are now turning our attention to once again working with our public and private sector partners to prepare some equally exciting bids for the second round.” Mr Catchpole believes the creation of an LEP Further information on Tees Valley will enable it to build on the links made so far Unlimited and its activities please visit and TVU has also organised a series of www.teesvalleyunlimited-investment.co.uk business briefings to raise awareness of the

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A HOLE LOTTA LOVE Providing the region with a dual carriageway road tunnel fit for the 21st Century – and a paragon of safety – is being completed at remarkable pace, Brian Nicholls discovers Any day now, perhaps even as you read this, drivers in the North East will be enjoying entry for the first time into the brand new half of Britain’s biggest construction and engineering project bar London’s Olympic project. For the Tyne’s second vehicular tunnel between Jarrow and Howdon, remarkably, is opening on time – completed in less than three years by 3,500 widely skilled people. It took 100,000 to build the Great Pyramid at Giza, and that with forced labour, they say. Here individuals appear at all levels, justifiably, to be experiencing now a sense of self-fulfilment. Certainly three key figures that BQ has interviewed exclusively let enthusiasm break through initial restraint as they talked the project through: Peter Hedley, Tyne Tunnel manager at TT2, Paul Fenwick, project director for Tyne and Wear Integrated Transport Authority, and Daniel Clert, project manager for main contractor Bouygues Travaux Publics. They, with TT2 managing director Trevor Jackson have lived and breathed the tunnel’s construction since the hard graft began in 2008 – site preparation in the February, tunnelling work six months later. Indeed, some have worked much longer on the project; it has occupied Fenwick for 12 years. They remind us immediately that completion of this second vehicle tunnel forms only part, albeit the major part, of the job representing a £260m capital investment in the North East’s

road infrastructure. Now the first tunnel, completed in 1967, has to be modernised. So it will be around December 2011, once that has been done, that the new Tyne Tunnel Crossing will be a fully functioning dual carriageway. Nor will it be a day too soon. The existing tunnel about to be upgraded has a capacity of 24,000 vehicles a day but currently receives 38,000. Clert has worked on many major civil engineering schemes around the world – Metro projects and roads underground on mainland Europe, and in Australia, Singapore and Hong Kong, as well as the new road tunnel in Dublin. Mostly this work has involved deeper excavations, and some projects were about 50km long. But he refutes any suggestion that TT2 has been simple by comparison. “While this one was shorter,” he explains. “It had to be fitted into very limited space. So it required deep excavations, complex dredging, and provision for a number of inconvenient but existing installations. Also the level of safety required is very high. This is one of the safest new tunnels ever made.” The tunnel has been built using immersed tube technology in the river section. Instead of direct tunnelling. A deep trench was dredged in the river bed and huge prefabricated sections of concrete laid in, giving 1.5km out of the total 2.6km length of the new carriageway. This method pleased Peter Hedley, because it sustained jobs at A&P Dry Dock in nearby >>

This is one of the safest new tunnels ever made

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Walker. The new tunnel has also come about using a “cut-and-cover” technique. Diaphragm walls standing parallel were erected below ground to give supported space for excavation to progress. Once the walls were cast, the area between was excavated in phases and temporary struts placed between the walls for support. The tunnel took shape there and then, using base and roof slabs for lateral support. It’s said one million tons of rubble came out and half-a-million tons of concrete went in. And waste not, want not – the unwanted rubble wasn’t dumped at sea where it would have infuriated fishermen, but into a disused dry

dock at Port of Tyne where it was welcomed to provide development land. The tunnel passes over the top of the existing vehicle tunnel, with less than three metres in depth separating. Again, care was needed. Associated pressure was applied above the existing tunnel to ensure no damage. A top-down technique was applied with roof slabs constructed first, then excavation beneath the slabs to maintain pressure upon the original tunnel structure. Constant monitoring of impacts on the existing tunnel throughout showed minimal movement. Amid all this complicated work there was not one fatal or serious injury, nothing worse >>

Tunnel vision: Left to right, Paul Fenwick, Peter Hedley, and Daniel Clert

Once the whole project is completed we predict we shall get the top rating in the surveys

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Benefits to come Improving the A19 here is expected to improve economic activity for the whole eastern side of the Tyneside conurbation. A primary task of tunnel management will be to ensure that tunnel closures due to emergency are minimal, to prevent toll revenues dipping as traffic warned as far north as Amble and as far south as Thirsk decide whether to detour inland. A great advance is the safety measures being introduced to both tunnels. A misty spray of water instead of conventional sprinkling would come down in the tunnels in future if fire broke out. It cools better, reaches all the corners, uses less water, and causes less pollution. This will be the first UK tunnel so fitted. Also Bouygues has put in an escape corridor. So, again in emergency, people caught in the tunnel could walk along this corridor safely shielded and breathing fresh air. The industry has learned from the Mont Blanc fire of 1999 that claimed 39 lives when a truck caught fire. As the same precautions will now go into the original tunnel also, the design standards for UK tunnels will be surpassed. Paul Fenwick says: “We are surveyed biannually by a European organisation that checks out all the European tunnels to give a safety rating. “Our organisation side has always been praised. But the first tunnel has had a poor rating because of its infrastructure. It’s old. There’s nothing we could do about that. Once the whole project is completed we predict we shall get the top rating in the surveys.”

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than a twisted ankle apparently. “We’re very proud of that,” Clert says. So time, not safety, proved the biggest challenge. Clert says: “We had to have activity on every part of the site simultaneously. Building from north to south systematically, or vice versa, would have taken 10 years. We’re talking about three years. Had anything gone wrong, we could easily have lost six months to a year. Fortunately there have been no major hitches.” Paul Fenwick says not only were the variable conditions of the ground challenging, the river itself needed environmental awareness – the Tyne is classed as as the best salmon river in England and Wales. “The Environment Agency and fisheries bodies were concerned about our intentions,” he says. “We had a lot of dialogue with them both before a public inquiry was held – and even since. The river had to be constantly monitored. “Also, with the cut-and-cover technique of construction, a community had to be severed. There’s a lot of housing eastwards on the Jarrow side, whereas people’s amenities are on the west side, including two schools beside the site – various businesses, too. All had to be taken into account – not just a matter of getting people across the site.” Motorists and truckers using the crossing regularly have been impressed how routeing and diverting has changed regularly and effectively as work has gone on all around. That required section managers of the construction firms to meet weekly as a communications group with Hedley’s operation staff, while on another level Fenwick and his team liaised with the local authorities concerned, the two consultations partnering throughout. Hedley says that while the changes affected communities on both sides of the river, mainly Howdon and Jarrow, more compliments than complaints were received. “We made a point of talking regularly to the communities and circulating information sheets,” he says. “Meanwhile all the companies have worked in partnership, pulling in the same direction – quite an achievement, perhaps, with 75 sub-contractors involved.” The local authorities were pleased by the sustained traffic flows throughout. And while

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I look forward to the point where local communities appreciate the change and users appreciate the increase in service, and the beneficial impact on the economy

the tunnel seemed quieter sometimes, prompting some belief that vehicles might be using the bridges upriver in Newcastle, driving the extra miles for fear of being held up, Hedley says no. “When the global crunch came early on there was a little dip in traffic which may have had something to do with fuel prices. It had nothing to do with the construction. Use of the tunnel hasn’t come down. Despite the construction the traffic flows have been managed and journey times actually improved.” How will they feel on the opening day? Daniel: “Relief”. Peter: “Pride and delight for my customers.” Paul: “I echo that and look forward to where the local communities appreciate the change, the users appreciate the increase in service, and the beneficial impact on the economy. “Personally I’ll miss it.” n

What you’ll pay The New Tyne Crossing project is self-funded under private-public partnership. Around half of the capital is coming from shareholders of the concessionaire, TT2. It’s the special purpose organisation that was appointed to deliver the New Tyne Crossing. It is partly owned by Bouygues Travaux Publics. The remainder is being raised by Tyne and Wear Integrated Transport Authority through Prudential Borrowing. Revenues will come from the tolls, with no burden on council tax payers. When the concession ends in 2037 all the tunnels will be handed back to the Integrated Transport Authority. “Don’t forget,” says Peter Hedley, “this is a four-tunnel site with existing pedestrian and cycle tunnels too. We handle quarter of a million cyclists and pedestrians a year and 12 million vehicle passengers.” A £6m budget has been approved to improve the Grade II-listed cycle and pedestrian tunnels, their lifts and escalators. Tolls are having to go up – “not by a lot,” Paul Fenwick suggests. “It’s only from £1.20 to £1.60 in a couple of steps. HGVs will go up

double the increase for cars, but these prices compare well with other tunnels. Even here, if you go back to the first ever toll and inflate it, the 2s6d, or 12.5p at today’s prices, it would be more than the £1.60 – more like £1.70. All this – and for less than we had to charge in 1967.” Scheduled bus services are toll-free. Use of the pedestrian and cycle tunnels is also free. The toll for motorcycles, presently 20p, will be abolished on January 1 2014. Peter Hedley says: “If you talk to customers the tolls isn’t an issue. It’s the value of time taken for the journey.”

The future tolling will be: CARS

HGVS

1 January 2008

£1.20

£1.50

1 January 2012*

£1.40

£2.00

1 January 2013*

£1.60

£2.50

1 January 2014*

£1.60

£3.20

* Subject to completion date of new Tyne Crossing and once all facilities are available to traffic

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NIGEL WRIGHT RECRUITMENT, BRINGING TOGETHER HIGH-CALIBRE CANDIDATES AND WORLD-CLASS ORGANISATIONS.

www.nigelwright.com

INTERVIEW

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WHAT KATE DID NEXT Kate Wickham at 27 has reached md’s seat in a macho zone of manufacturing and is pumping in benefits of overseas experience. Brian Nicholls meets her Managing director at 27 – good going that, particularly when the woman in view is driving her family’s firm in the macho world of excavators, cranes and other offroad vehicles. No sexist innuendo is intended there either, especially since Kate Wickham takes up her challenge – promotion from business development manager – just as the company distances itself from the recent recession. Kate’s a highly personable hard and fast talker; boss in a business making good headway not only at home but also overseas – in the US, mainland Europe and Asia. She’s doesn’t spare herself either. She ran in her maiden Great North Run recently and set herself a target of two hours. She’s still disappointed as she

recounts months later that she took two hours and five minutes. “I think I started too fast,” she grumbles. As the Gateshead company’s name indicates, the family owning Gate 7 is very much sports motivated. Gate 7, we’re reliably informed, is the gate in whitewater canoe racing at which contestants start to acknowledge physically and mentally the immensity of the challenge they’ve set themselves. It was certainly a challenge when Kate and her family set up the business in 2000 designing and manufacturing decals, corporate logos to adorn the vehicles and safety and instructional warnings that by now must have helped to safeguard countless lives.

Japanese firms put so much thought, time and effort into every change and new development they make. Everyone in the organisation has to be involved and know what’s happening so that everything moves ﬂawlessly BUSINESS QUARTER | WINTER 11

“We began in the back garden at home at Whitburn,” Kate recalls. “There were four or five of us at the start. We established a niche market early on among the manufacturers of construction equipment. “Our target was blue-chip firms which, in that sector, have their manufacturing plants widely scattered over many countries. This offered us organic growth through recommendation. It takes a lot of effort, though, to persuade companies like these to sever reliance on local service. For all of us it involved a lot of legwork.” What a client list now, though. They first made sure of their own ground, selling themselves locally. They captured Komatsu and Caterpillar in the North East and subsequently have made it up to the enviable hat-trick of hitters with JCB. The workforce now totals 45 in the UK, and in 2008 the firm opened a US branch in Pennsylvania, which Kate, a regular visitor, describes as a mirror image of their Team Valley operation. Gate 7 has won the export class of the North East Business Awards and was named Export Business of the Year 2006 by the North East Chamber of Commerce. But it was winning >>

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INTERVIEW

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INTERVIEW

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the Queen’s Award within five years of start-up that worked wonders. Kate explains: “Americans are impressed by this award, just as they are impressed by the Royal Family. They loved it then and now that we have won the Queen’s Award. To them it’s a national treasure, to us it’s a good opener. “They want to know: Do you know the Queen? Have you met her? What’s she like? American customers can be very tough to deal with but they do like the Brits, as do Indians to this day. “In dealings, the Americans are very straight down the line, very blunt. But you enjoy a bit of an edge because there’s no language barrier and there is a ready welcome.” Kate’s father Keith, who has become chairman as Kate takes the md seat, is a leading UK exponent of silkscreen printing and well known in North East business circles. He has an irrepressible optimism which Kate says is a perfect foil for her occasional mood of pessimism. He decided opportunely that the firm should risk a US opening. As Kate explains: “The US after 9/11 was looking at itself, going through a process of change. One of its inclinations was to seek greater self-reliance in its economy. So we were there, could pitch for business and be acceptable. “During the recession also there has been a US

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push to have the goods for its market made within the US. We had chosen America because we didn’t think we could serve it as well as we should from here anyway. It has proved a valuable foothold.” Now they’re pushing into India, where payments – as in the US – are made promptly. Kate says: “Sales leads in Europe look positive too, because although there are many local suppliers in this established market they didn’t seem good enough to satisfy customer needs.” As recession took grip, making construction one of the worst hit sectors everywhere, Gate

Things are starting to look up. And, do you know, through all the recent difficulties of recession we’ve never lost a customer

7 has entered additional markets abroad, including Japan, Brazil and Turkey, and is now looking at new sectors also, such as agriculture. “It can be daunting going outside the EU – I’m not denying that,” Kate admits. “But in India, where you expect competition costs to be much cheaper, we won a couple of really big deals with JCB. And we have several more leads we’re pushing. It all looks very positive. Firms there buy abroad when they can’t get a certain standard at home.” Without the support of UK Trade & Investment, the opening of foreign markets would be daunting, the firm agrees, warning that novices to exporting must be financially prepared. “Mainly it’s the initial costs,” Kate elaborates. “The unavoidable such as air fares and hotel bills. We spent thousands sending a couple of our guys to the US, only to find that the businesswoman they were to meet couldn’t meet them because, unexpectedly, she had to take her daughter to school. Three thousand miles we’d travelled but, ‘sorry... I can’t make it today’. You get knockbacks like that. “You can invest money and not win the business. But when you do it’s worthwhile. We never gave up then. We never give up now. Then, so long as you supply the parts and >>

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keep the customers happy, there’s no reason for them to switch.” Kate isn’t simply stepping into her father’s shoes out of hereditary advantage – as happens in many family businesses – for he is only dedicating himself now to progressing US operations because he’s confident Kate has had the grounding and thus the skills to drive the UK business. Her business acumen sharpened when she worked for six months in Belgium with Ingersoll Rand, the $13bn global and diversified industrial company with 100 years of technical innovation behind it. She also spent two weeks with world-class companies in Japan, visiting two factories a day to absorb principles of lean manufacturing – working better, faster and more efficiently. “Japanese firms put so much thought, time and effort into every change and new development they make,” she says. “Everyone in the organisation has to be involved and know what’s happening so that everything moves flawlessly. We had heard all the theory about this, but to see it in practice is wonderful. “Here and in the US, no disrespect, we tend to be a lot more hands... suck it and see. We make a change and monitor from there. We try to take these principles and make them work here. We’re under no illusion, though, that we can do it like the Japanese.” In Belgium, Kate developed insights into dealing with customers and raising relationships to higher levels. “It’s always good to see how other companies work,” she says. She was only 11 or so, a pupil at King’s School, Tynemouth, when she found an appetite for business. Her father had allowed her a week’s work experience at an earlier Tyneside business of his, printing among other things, colourful posters which must have added millions to the sales of newspapers they advertised. She was given her own little desk where she stuffed envelopes and walked to the tuckshop for chocolate bars. “Everyone seemed to know my name and was nice to me,” she says, “and I was able to see a lot of what business entails. I remember thinking: ‘I could get used to this’. As you get older you realise what business really entails.”

All the Wickhams excel in sport, being keen runners like Kate for example. Also though, both her parents and her older brother Oliver have canoed for England. Among her other brothers and sisters Charlotte, 25, is a full-time middle distance runner based at Loughborough. Harry, 21, is a semi-professional cyclist in Spain, hoping to break into the British road racing team. Oliver, 30, runs Gate 7 Signs serving estate agencies at the Team Valley factory and that may become a separate firm eventually. Sophie, 23, is meanwhile in London, focused on a sales career. Kate’s mum, a retired teacher, has been a poster girl for Gate 7, portraying canoeing enthusiastically above the company name. David Coppock, UK Trade & Investment’s International Trade Director, affirms that Gate 7 has succeeded in reaching the top end of a highly competitive market. “They’ve proved that with the right kind of support there are opportunities for North East businesses of all sizes to compete on an international stage,” he says.

INTERVIEW

Later she continued to work in the family business when opportunity allowed. Her business study gained academic dimension at Leeds Metropolitan University where her graduation after four years included a year out marketing at Arla Foods whose milk and dairy products include the Lurpak and Anchor brands. “All along I wanted to get back and work at Gate 7,” she remembers. When she did get back, one of her first responsibilities was to organise a big celebration, marquee and all, marking the Queen’s Award win. She followed this up by preparing a welcome for an official visit by Prince Andrew. “I started in a human resource role and in other aspects of the business saw I could put things into place and add a shine to the company,” she says.“I got involved in account management, which enabled me to work closely with customers; I spent evenings working with our production manager to gain shopfloor experience, joining the overtime team working from half past four till nine o’clock at night. I learned a lot from that, and today I wouldn’t like to ask people to do things I couldn’t do myself. I think that’s quite important.” Kate hopes five years from now Gate 7 will be even mightier in Europe, maybe manufacturing in Belgium or France, and enjoying prosperous markets in the like of Brazil, South Africa, China and Turkey. In Britain no one company in Gate 7’s field dominates. “They’ve all had a tough time recently and locally there have been casualties,” Kate says. “Among many companies in competition only ours is totally focused on our chosen markets, with everything geared to that.” The firm restructured, a challenge that fell to Kate, as product improvement and cost reduction was intensified. Some redundancies had to be made during the worst of the recession - but staff have also been hired since to advance research and development. The turnover of around £5.6m is expected soon to regain a pre-recession level. “I believe we’ve made it through the worst, fingers crossed,” she says. “Things are looking up. And, do you know, through all the recent difficulties we’ve never lost a customer.” n

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COMPANY PROFILE

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Information and guidance for employers

RAISING THE PARTICIPATION AGE (RPA)

n 2009/10 the DfE (Department for Education) decided to run a small pilot in preparation for the delivery of the Raising the Participation Age agenda. Newcastle was one of the authorities identified to take part and Newcastle Education Business Partnership is supporting the initiative by providing information and guidance to employers. The EBP has prepared a programme of awareness raising which includes a range of media and methods of presentation appropriate and convenient for employers. It is the intention of the EBP to inform as many employers as possible and we are in the process of developing a blog to facilitate debate and feedback on this important change in the education system. RAISING THE PARTICIPATION AGE (RPA) One of the most urgent challenges facing our country today is ensuring that all young people progress in education and training. The UK needs to develop a more highly skilled workforce to compete internationally in a fast changing global economy. According to the Organisation for Education Cooperation & Development (OECD) the UK ranks 27th out of 30 countries on participation at age 17. There is clear evidence of the negative consequences of not engaging young people in education or training at 16 – 18 years. Many of those not engaged are from disadvantaged areas in the city of Newcastle and there is strong correlation to later negative outcomes, such as unemployment, ill health and crime. Outcomes for young people aged between 16 and 18 in a job without formal training are only marginally better than those not in employment, education or training (NEET). RPA is a historic step to ensure that all young people have the same opportunities and expectations of success. Not only will it raise

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the aspirations and expectations of young people but it will also yield long –term benefits for the economy and society as a whole. What does RPA mean to a young person? Legislation was passed in the Education and Skills Act of 2008 which requires young people to stay in education or training until 17 from 2013 and until 18 from 2015. RPA does not necessarily require a young person to stay on at school. The coalition Government has made clear its commitment to this. There are several routes and opportunities for young people to follow:Full-time education, such as school or college, work-based learning, such as an Apprenticeship or part –time accredited education or training (around a day per week) if they are employed or volunteering for more than 20 hours per week. Support from employers is integral to ensuring that every young person from the age of 16 has the opportunity to progress and succeed. We need to work collaboratively to break intergenerational cycles where these exist and ensure that our most disadvantaged young people can take their place in this fast changing world.

Evidence suggests that: Young people who stay in learning for longer will have: • More to offer employers. • Be better qualified with relevant skills. • Be more work ready. • Bring a fresh approach to the business. • Be more knowledgeable of advanced technologies. • Contribute to a more highly skilled productive and internationally competitive workforce. How can employers help us prepare for RPA? 1. Continue to offer accredited training to young employees. 2. Offer Apprenticeships. 3. Continue to offer work experience placements to raise young people’s aspirations, including those from disadvantaged backgrounds or who have special needs. 4. Share your own concerns regarding the potential implications of the new legislation so we can prepare for 2013. 5. Share our BLOG www.newcastle-ebp.org.uk 6. Provide opportunities for us to present information to employer networks.

To find out more or to get involved contact Gillian Bulman | Chief Executive NEBP 0191 2774444 gillian.bulman@newcastle.gov.uk www.education.gov.uk/ www.newcastle-ebp.org.uk

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“ The Entrepreneurs’ Forum is unique in that it embraces all ages and stages of business. There’s a vibrancy about it and there is not a single event that I’ve been to where I haven’t learned something.” Anne Ganley, Thompson Building Centres.

For more information on how to become part of this unique peer group and tap into a powerful combination of wisdom and inspiration visit www.entrepreneursforum.net or call our team on 0870 850 2233

ENTREPRENEUR

Duncan Edward, Ian Gillespie and Michael Fitzpatrick

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ENTREPRENEUR

THE ROAD MAP MAKERS Telecoms entrepreneur Ian Gillespie calls in the executive team to discuss with Brian Nicholls their latest new venture which they say could be good news particularly for SMEs

The UC factor – Unified Communications – promises small and medium size businesses access to telecoms services that only large businesses could enjoy before. And it is this burgeoning SME sector that a restructured and enhanced North East specialist in communications, Activ Telecom, is setting out to win. Activ Telecom was originally part of Fone Logistics which serial business builder Ian Gillespie has sold twice over – on the last occasion, after his buyback, to Daisy last summer. He retained Activ Telecom in the deal and is now chairman, with former finance director Michael Fitzpatrick now managing director taking the lead in day-to-day running, and Duncan Edward sales director. Fitzpatrick has worked for six years alongside Gillespie, and Edward, a friend of the chairman for 14 years, joined Activ Telecom last December, having worked in telecoms for 20 years or so before heading the London sales division of Canon photocopiers. Four months ago Activ Telecom moved to new premises at Balliol Business Park on Tyneside, from where the drive for SME customers is now under way. Fitzpatrick explains: “Fone Logistics was a

national business, a national distributor serving other resellers of mobile phones. Now we’re going back to Ian’s roots and selling direct into the SME market. Effectively, technology has been bringing more great advantages and changes in communication – in mobile, fixed line and computer. As their convergence advances, we see the need for a player like ourselves to bring all three together. “Some of the products we’ve just launched would have been appropriate only to large enterprises one time. Now they can be offered to SMEs, promising much more efficient and cost-effective solutions to them too.” People running SMEs depend increasingly on their mobile and, suggests Fitzpatrick, as the

technology moves on – iPads, iPhones, Smartphones etc – they may need more help and guidance. ”But you can’t ring a network and expect instant service,” he says, quoting the recent example of a frustrated Blackberry user who couldn’t connect instantly to his betting account until Activ Telecom intervened. The firm describes itself also as rolling out a road map of products combining seamlessly fixed line and mobile communications. One consequence is greater flexibility in how a firm accepts calls. It can operate a single voice mailbox and terminate a landline number into a mobile, and vice versa, enabling incoming calls to be received anywhere and from >>

Over six months we have invested heavily in infrastructure and people. We’re being really well received

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Ful

ENTREPRENEUR

everywhere. Numbers, voice mail and system features can be shared, with calls between the landline and mobile phones unlimited. Many different services have been available for some time on fixed line, and now mobiles sellers are descending on this area of the market. “At the same time there’s innovation in how it’s tariffed,” Edward points out. “You can buy your communications in a bundle, enabling you to manage your costs a lot more. Your IT solutions too. Rather than customers buying their Microsoft products, we can rent them by the month. Investing in licensing is no longer necessary, you can run on hosted solutions. That’s the next stage of the product road map of our journey into offering IT services.” Duncan Edward says there’s a raft of

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information available to help small business benefit. “For example, even the smallest business can gain an extra hour of productivity per person a day by arming them with a Blackberry,” he maintains. “Also, Microsoft believes that by about 2015 half of all SMEs will be using hosted solutions rather than buying for themselves. It sounds feasible. It can be more efficient and you get all the updates. You don’t need IT infrastructure. You just plug in and it works. There’s no capital expenditure. Even the telephone system is hosted and needn’t be bought. As long as there’s a broadband line into one’s building all the other things are taken care of. Your entire phone system can be hosted, in effect.” The networks, whose voice revenues are

An Activ emergence Ian Gillespie took Fone Logistics to peak turnover of £100m ten years after its launch at Cramlington in 1996. He sold most of the business to the expanding North West Plc Daisy Group for £3.6m last June. He then focused on Activ Telecom, which bought Fone Logistics’ businessto-business work with the 3 network just before the deal. Activ has since doubled its staff numbers. The move from Cramlington to Balliol was made in pursuit of space to grow, Gillespie said at the time. Gillespie, a runner-up in the 2007 North East Business Executive of the Year Award, progressed Fone Logistics into one of the region’s fastest-growing firms before selling two-thirds of his share in 2006. He took a more active role again in 2009 in a shake-up that followed a drop in turnover to around £50m. He describes his chairmanship now of Activ Telecom as a “mentoring role”. Daisy, which also bought BNS last year, moved 30 Fone Logistics staff to BNS’s Prudhoe site. Fone Logistics was taken into Daisy’s mobile distribution division managed mainly from Ipswich, and the Cramlington site was closed, reportedly with 27 redundancies.

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falling, recognise the potential here and are moving in to add value and competition is growing from mobile and IT sources. Activ Telecom remains particularly confident, however, since it has just been selected as a gold (key) partner of Vodafone in the North East, and is an approved partner also of O2. “So we’ve a lot of strength behind the products we are selling,” says Gillespie, adding that what differentiates Activ Telecom from a network in the market place will be a service wrap around its products. “We’re local and building relations with customers on the ground. So we’ve a full understanding of their business. We can also step in quickly in emergencies, such as when a handset has been lost or mislaid just before a critical meeting or appointment. Also people get personalised service through an operation like ours, another SME.” The company plans breakfast seminars and clubs where customers can learn more for themselves about maximising the use of their equipment. It promises to deliver all that’s available, delivering locally and keeping customers updated. “The mobile phones industry has a history of selling on price,” Fitzpatrick says. “We’re confident we can improve people’s spend on their communications. At the same time imparting an understanding of the technology can guarantee further efficiency during a consultative sale. “With the sale of Fone Logistics to Daisy we’ve retained the direct selling division and, over six months, have invested heavily in infrastructure and people. We’re being really well received.” ■

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The quiet man Entrepreneur Graham Wylie is embarking on the most important venture of his life – raising funds for the children’s heart unit that saved his baby daughter’s life, as he tells Jane Pikett There are few places in life so democratic as an NHS hospital – a place where money, power and influence have no part to play in the survival or not of patients, whoever they are. Graham Wylie has amassed considerable wealth and influence during an illustrious entrepreneurial career, but a few months ago he had to stand by and watch, just like any other father, as specialists at Newcastle’s Freeman Hospital fought to save his baby daughter’s life. He recalls his daughter Kiera’s battles for health over the last year in raw detail, describing the summer day when she suffered a catastrophic collapse at the hospital as if it were yesterday, his eyes filling with tears as he describes the dreadful moments as her blood oxygen levels descended from 80% to zero as medics battled to save her. A so-called “blue” baby, Kiera was born in December 2009 with complex heart problems requiring life-saving surgery at just two days old. She then suffered complications following an infection last May, which resulted in that

terrible, life-threatening collapse. Kiera, 14 months, is now well on the way to recovery and able to engage in happy rough and tumble with her twin sister Zahra, but her continuing care, courtesy of the best the NHS can provide brings into sharp relief the fact that when a child is critically ill, power and influence count for very little. “The Children’s Heart Unit at the Freeman is mind-bogglingly brilliant, yet people know so little about it,” says Wylie, whose daughter’s health issues were first revealed by a scan four months before she was born. “They scanned twin one, Zahra, and said everything was fine, and then they got to twin two, Kiera, and there was a deafening silence in the room. I knew then something was very wrong,” he recalls. Kiera’s pulmonary artery was not fully developed, and that was to result in life-threatening problems pumping blood from her heart to her lungs. Wylie recalls that day, and several more desperate days of 2009/2010, in minute detail,

They scanned twin one, Zahra, and said everything was fine, and then they got to twin two, Kiera, and there was a deafening silence in the room

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describing how he and his wife Andrea, just like any other happy couple, arrived at hospital looking forward to seeing their twins on their landmark 20-week scan, and left in the knowledge that one of those precious babies would need life-saving surgery within days of her birth. The Wylies entered another world at that point; the world of children with terrifyingly complex health problems, a place where wealth and power make no odds. “There is just nothing you can do,” he says. “You are in the hands of the experts and no amount of money or influence can help you. All the parents are in the same boat and until recently, no-one at the hospital knew who we were. You’re not going to turn round and say, ‘do you know who I am,’ are you?” Perhaps not, but there are a few in Wylie’s position who would. But as those who know him will attest, ‘do you know who I am?’ isn’t a phrase he’s likely to use, no matter how difficult the circumstances. The incongruity of discussing what are still raw and extremely painful memories of his daughter’s first traumatic year while we enjoy a pleasant lunch at Louis in Jesmond is not lost on either of us. Louis, among others, is now the Wylies’ local, since they moved from their grand country home, Chesters, near Hexham, to Jesmond, to be closer to the Freeman Hospital, where Kiera still has a way to go with her treatment. They have also adopted the Freeman’s Children’s Heart Unit Fund (CHUF) as their charity – the reason behind our lunch interview – and Wylie intends to devote much of his time over the next few years to building a sustainable fundraising effort. “I want to raise CHUF’s profile so that when people want to support a charity it is one of the first they think of,” he says. “We have plans for annual events which will become part of the fabric of the North East >>

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BUSINESS LUNCH calendar so that the fundraising effort is genuinely sustainable.” It is an understatement to say that Wylie’s considerable business acumen and enviable contacts book will be a boon to CHUF. Doubtless, this is also the most important venture of a life which has been marked by great entrepreneurial success and a notable strength of character. An early IT pioneer, Wylie was a co-founder of Sage (he retired from the company at 43), and now has many business interests, including as owner of the luxury Close House Hotel, golf and leisure complex near Newcastle and co-founder of the fast-growing IT group TSG. He also has a sizeable property portfolio and a string of racehorses. His considerable success in business now affords him the freedom to work as much or as little as he wishes, which means that if you believe in fate, his commitment to CHUF is well-timed, arriving as it does at a time in life (he is 51) when he can devote a considerable expertise honed over 30 years in business. Personable, quietly spoken and very private, Wylie is aware that his very personal experience of the Children’s Heart Unit is one he is going to have to tell in raising awareness of CHUF, and his openness in doing so is extremely affecting. He openly admits to some very dark days over the last year, but also adds on more than one occasion that he and Andrea are actually in a very fortunate position. Their daughter’s heart will be mended, in time, by the specialists at the Freeman. He also has the time to devote to his family without worrying about money, and he is acutely aware of the fact that many in his position are not so fortunate. “The unit serves a huge area of the North of England and Scotland,” he says. “One of the most basic needs is for parents to be able to stay at the hospital with their child, and that applies whether you’re Graham and Andrea Wylie or anyone else. Having a poorly child puts a huge pressure on families.” Most people, one imagines, listen when Wylie speaks. One assumes this is why he was one of the parents asked by specialists at the unit to speak to a Government-appointed team currently reviewing the future of the country’s 11 specialist heart units.

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His quiet, thoughtful tone is one which implies knowledge, experience and not a hint of an ego. Self-deprecating and honest, he claims good luck and being surrounded by brilliant people has driven his success. “We had great people at Sage and I have great people around me now,” he says. “If I can’t do something, I employ someone who can.” He describes himself, simply, as down to earth. His was a working class childhood in Whitley Bay, his coal minder father was in his late fifties when Wylie and his younger brother were born, and his mother running their home as a boarding house. “I’ve honestly just been lucky,” he asserts. “I was given a good education at Whitley Bay High School. I went to Newcastle College and Newcastle University and since then I’ve had great people around me.” It all sounds remarkably unremarkable, until he mentions that as a computer science and statistics student he attended lectures in a suit and tie, in readiness for meetings with business contacts while his fellow students headed to the Union for a beer or three. “I admit I was quite a strange individual at university,” he says. “There were no tie dye t-shirts; it was suit and tie because after lectures I was meeting clients for the programme which was to become Sage Accounting.” Living at home throughout his student years, he was so divorced from student life that when his son took him to the Students’ Union a few months ago, he was forced to admit he didn’t even know where it was. His entrepreneurial tendencies didn’t emerge until university. At school, he thought it more likely he’d be an accountant. “I loved sport – still do – but I wasn’t sporty and my rugby teacher was Roger Uttley who played for England. He said, ‘you either play rugby or the wimps can go to the IT college’. I wimped out. “They used to bus us wimps along to the local college to do IT while the rest played rugby on wet, windy afternoons. I’ve heard that when Roger Uttley does after-dinner speeches now he says he was responsible for creating Sage.” He says Sage “just grew”, for all the world as if it happened to him, rather than partly because of him.

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“Sage was not great planning; it just happened. We changed our minds every other day. Being flexible works. I’m about to start a new business and I won’t have a business plan for the first 12 months.” He left, aged 43, because the business, by now a plc, had simply outgrown him. “I was spending too long in meetings and the business had outgrown me,” he says, simply. “I had gone on as long as I could.” He had also had testicular cancer (a defining experience), had married Andrea, and bought Chesters. So did he take some time out? “Yes. About two-and-a-half hours,” he says. Then he made a few calls and got TSG under way. “TSG is very different,” he says. “Sage grew organically from nothing. TSG is grown by acquisition. It’s a very interesting journey. We’ve bought 30 businesses, all of which have

BUSINESS LUNCH

Have a Heart For more information about the Freeman Hospital Children’s Heart Unit Fund (CHUF), contact: Lorraine Embleton, Children’s Heart Unit Fund, Freeman Hospital, Freeman Road, High Heaton, Newcastle, NE7 7DN, tel: 0191 213 1365, info@chuf.org.uk, www.chuf.org.uk

come with a different culture and different systems. We are trying to put all these businesses together with the same systems and these days, I handle the bigger picture stuff and delegate the rest. “When I was younger I would get emotional

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about some things. Now, I’m able to let things go. I’m also able to listen to ideas and while I would have said ‘yes, let’s give it a go’ a few years ago, I can now say, ‘no, that won’t work’, because I have the experience to know what works and what doesn’t.” In addition to dipping in and out of TSG, he is busy at present with the 400-acre Close House Hotel, golf and leisure complex at Heddon on the Wall, where he is adding another golf course, undertaking a major refurbishment and adding new bedrooms. The work will put Close House on a par with Gleneagles. Wylie’s business interests also extend to investing in fledgling businesses, a property portfolio and some business interests in US. A successful racehorse owner, he currently has nearly 90 horses in training. For Wylie, it is variety which provides the spice of working life, and the horses which >>

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BUSINESS LUNCH provide excitement (in the five days prior to our meeting, he has had a winner every day). One gets the impression that now Kiera is on the road to recovery, Wylie is allowing himself to breathe again. He has the freedom to work as he wishes, aided by nothing more sophisticated than a desk diary controlled by his secretary and his wife. Life is quietly, unremarkably contented. He imposes nothing on his kids but the wish they are happy. His daughter Rachel, 25, is a midwife in London, while his son Richard, 22, is back at university. There are no targets for CHUF because, Wylie says, targets only limit him. To illustrate, he explains that he set himself a personal target, something to do with money, last January and give himself 12 months to achieve it. In the event, it took a fortnight.

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But does he really let the paying guests treat the house as their own? Don’t they take advantage? “Honestly, we’ve had no problems.”

Good taste Jane Pikett and Graham Wylie lunched at Louis, Osborne Road, Jesmond, Newcastle, NE2 2AN, tel 0191 281 4545, www.louisjesmond.co.uk Call us old-fashioned, but there is a lot to be said for polite service, starched white table linen and cutlery and glassware polished to within an inch of its life. Well done Louis for recognising the fact. The elegance of the setting is matched by the food. Graham’s French black pudding starter served with new potatoes and a poached egg was simply delicious, as was Jane’s succulent squid, seared with garlic, chilli, coriander and lime. A simple penne carbonara suited Graham to a tee, and seafood thermidor baked in mustard and cream cheese sauce did likewise for Jane. A glass of pinot noir for him, a sauvignon blanc for her, and a very pleasant hour or three passed in a flash. While a working lunch might be anything from a pie and a pint to five-star grandeur, Louis hits the middle ground beautifully. Tasteful, well-mannered, unhindered by ego or an inflated sense of its own importance, it also mirrors the character of our interviewee, so it is no surprise that he has adopted it as a favourite since he moved to the neighbourhood.

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“That’s why I don’t set targets,” he says, with a smile. Unusually for a man who owns a golf course, he makes little time to play. “Once last year, once the year before – and it’s not just because I’m not very good,” he adds, with a wry smile. A man of balance, he claims no great career highs, but lots of great days. His greatest moment to date in horse racing – Inglis Drever winning the Ladbroke World Hurdle at Cheltenham for a third time in 2008 – was celebrated with a quiet dinner with Andrea at their hotel because the owner of the second favourite was staying at the same place. “We didn’t want to do anything outlandish and offend him,” says Wylie, simply. The turning point in his life – and his preparation for what was to come with Kiera, was a diagnosis of testicular cancer in June 1999. “They fixed me very quickly, but there were four weeks between being told about it and being OK, and those weeks changed my outlook completely,” he says. “I realised I might not be here much longer. I also realised that I might be very wealthy, but what’s the point if you don’t enjoy it?” He’s still not exactly Mr Reckless, but the experience did make him think more about his work/life balance, and began the process to where he is now – with the time, the expertise and the influence to make a major difference to a cause close to his heart. He says: “There are 11 heart units in this country, but only two carrying out transplants for children – one is Great Ormond Street and the other is the Freeman. I bet you know all about the one in London, and very little about the one on your own doorstep. “It is run by a small bunch of incredibly dedicated people. There are only two consultants, they need equipment and resources and improved accommodation for parents. Yes, I can write them a cheque and walk away, but I want to create something much more sustainable than that.” He is also quietly, meticulously determined. “I’m not ruthless, but if I want something, by and large I will get it,” he says. “I don’t accept defeat without a very good reason.” One imagines the people at the Freeman will be very pleased to hear it. n

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HENDERSON ON WINE

WINTER 11

FRENCH FANCIES Professor Graham Henderson, vice-chancellor and chief executive of Teesside University, appreciates a midwinter touch of sun As a keen wine drinker and a relative fan of French wine, with what I would describe as eclectic tastes, I was delighted to be given the opportunity to sample two French wines that I had never tasted before – particularly given the fact that neither of them would have been a natural choice for me. The first I tried was a 2009 Pinot Noir (Vin de Pay de l’Aude), but on settling down to the task – full of enthusiasm – I was a little taken aback to find the bottle named Le Fou (the Madman) and I began to wonder if BQ were trying to tell me something! Undeterred, however, I discovered that the name of the wine stems from the fact that it has long been thought that only a madman would try and produce a perfect Pinot Noir in the Languedoc – but commentators believe

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that Eric Monnin achieved that aim and, in so doing, dispelled the myth. Despite the frost and snow outside my lounge window, its description as a “unique wine from the sun-drenched vineyards of the south of France” immediately put me in the mood to “enjoy a glass of red” and so I carefully poured and studied a glass. My first reaction was to think how unusually dark the wine was for a Pinot Noir and, despite my poor sense of smell, I couldn’t help but detect the fragrance of blueberries. And… the taste? Well, what can I say, a very pleasant wine, very smooth, but with a slightly bitter, but by no means unpleasant, aftertaste. Certainly not a wine that was difficult to drink, as I discovered as the contents of the bottle rapidly disappeared before me. Settling down the following day, I then had the pleasure of sampling a Duc de Morny (2009), Coteaux du Languedoc, produced and bottled at the Cave de l’Ormarine in the Picpoul de Pinet, the largest white wine producing area of the Languedoc in the South of France just near the Mediterranean coast – a truly amazing part of the world, and an area where I have been fortunate to savour good French wine in the past. Thinking back to happy days spent in the South of France I open the bottle, noticing the acclamation on the bottle that it was the winner of the Medaille d’Or in 2010. A crisp, medium dry white wine with a vague citrus aroma – or was it pear? I wish I had a better

sense of smell, I found it to be a smooth, mellow wine with a very slightly salty taste... a wine which my wife would describe as very “more-ish” – which it clearly was, as I proceeded to enjoy it – to check that it was really as pleasant as I had first thought. So there I sat, reflecting on my first experience as a (very) amateur wine taster, and I couldn’t help but think that whilst I was undoubtedly not a great judge of wines and I was just someone who, like many others, enjoys drinking wine socially, I had been privileged to be able to sample two very pleasant and very drinkable wines that I would happily drink again. n White wine: Duc de Morny 2009 Vintage, Picpoul de Pinet Coteaux du Languedoc £7.99 Red wine: Le Fou 2009 Vintage, Pinot Noir, Vin De Pays de L’aude £7.49 Available from The Wine Shop, Fenwick, Northumberand Street, Newcastle upon Tyne, NE99 1AR

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sole survivor Turning a British institution around was no easy matter for Tim Little. He made some crucial, timely, and deeply unpopular decisions, then ended up putting his money where his mouth was, as Chris Porter discovers

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Tim Little seems to be joking about his new-found need for sleeping pills, but then the CEO of Grenson shoes has just spent several millions buying the company. “And that really has made a massive difference – between sleeping at night and not,” he says. “I could see that we had turned a corner and I was terrified of walking away and someone else seeing it all take off – or of someone else cocking it all up. But that’s the arrogance of being certain that your way is the right way.” In Little’s defence, so far it has been. And when it opens its second retail store this new year – the first has seen a sales increase of 45% year-on-year – launches its e-commerce site and pushes on with collaborations it has built with the likes of brands Albam and Rag & Bone, and retailers Matches and MyWardrobe, his case might well be proven. That the likes of Noel Gallagher and Jack Nicolson wear Grenson shoes too now just adds to the brand’s new cool. It was five years ago that Christian Purslow – a City-type finding himself the inheritor of a classic men’s shoe manufacturing business in Northamptonshire with a heritage dating back to 1866, and counting among its clients the likes of style icons Fred Astaire, Cary Grant and David Niven – began to look around for a suitable CEO to turn the company around. He found Little, an ex-advertising man who, with pioneering foresight, had set up an eponymous shoe brand in 1997, taking the best of British shoe-making but updating the style and presentation for a younger, more fashion-savvy audience. Little took the advice of the designer Paul Smith, set down what he perceived his own brand and that of Grenson represented, decided there was enough difference and took on the job. And what a job: Grenson perhaps was the archetypal example of the crisis point facing most of the last remaining

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10 men’s shoe manufacturers in the UK. “It was clear there just wasn’t demand for its product,” says Little, who has also acted as design adviser to the likes of Dunhill, Tod’s, Office and Urban Outfitters. “It just wasn’t modern enough and the company had come to rely on sales of a moccasin shoe that not only didn’t fit with the brand but was sold to an older customer that was dying off. “It wasn’t alone – much of English shoe manufacturing is stuck on an old-fashioned, stuffy presentation, banging on about quality and nothing else. They understand manufacturing but not the market, because they have grown out of a time when that wasn’t required – not marketing in the sense of putting an average product in a fancy box but making the product fit the market. And as far as I was concerned, the moccasin was dead from day one.” Killing the moccasin was not an all-round popular decision. Little faced a barrage of livid retailers telling him he was killing an august institution. “They were telling me I was taking Grenson to the dogs – they felt like they had ownership of the brand,” Little explains. “I felt like I was taking over a football club, given the reaction I got.” He ploughed with radical changes regardless. There was wholesale massacre of Grenson’s long-standing accounts – goodbye sellers of moccasins – and branding and packaging were overhauled. Cheaper materials were banished. Aware that, as Little puts it, “there are not that many men willing to pay £300 or more for a pair of shoes”, he introduced a more accessibly-priced range made in India from designs and materials provided by Grenson, and returned the domestic factory to making only top-flight Goodyear-welted classics, strong on the claim of being 100% genuinely British-made, rather >>

There just wasn’t the demand for its product. It just wasn’t modern enough and had come to rely on sales of a moccasin that didn’t fit with the brand

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than merely finished in the UK. Customers of the Indian product are already aspiring to trade up. He opened a shop in the City and began to work on making shoes for younger fashion brands that have helped win Grenson a new credibility – the kind that other English shoe brands have attained only because the recent fashion for heavy classic men’s shoes has blown in their favour. “We were lucky in that Grenson had hardly any distribution, so the brand had not been ruined, so much as just left to die,” says Little. “But I had this moment about four months into the job when I thought it was all too

much to fix and Grenson was too far gone. “You start with the idea that it’s 80% OK and you just need to correct 20% of the company’s operations, then you find it’s the other way around. It was when I showed our plans to some of the big fashion footwear buyers and they said ‘that’s exactly what we’ve been looking for’ that I was persuaded to keep going.” All the way, as it turned out. During a break from Grenson early last year to allow him to refocus on his own brand, during which Little served as a board member and adviser, Purslow asked him an unexpected >>

English shoes are among the best in the world and it’s a craft that is in danger of being lost. It’s all about having a product that is relevant

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question: Would Little help him find a buyer for the business? In a Victor Kiam moment, Little decided he liked the product so much, he would buy the company – with a little help from the bank and a few investors. Now the sole owner, it offers the opportunity for Grenson to develop further still, even perhaps to provide something of a template for just how other English shoe manufacturers might consider their own futures. “English shoes are among the best in the world, and it is a craft that is in danger of being lost,” says Little. “It’s all about having a

product that’s relevant. English shoe manufacturers need to understand design and most don’t even have a designer. “It’s just bizarre. I hope Grenson might be an example of the need to have someone who understands design and marketing. That doesn’t mean making wacky or weird shoes. It does mean realising that, although English shoes may be fashionable at the moment, that is not a trend these companies will be able to ride for long. When fashion changes, the tills will stop ringing.” n www.grenson.co.uk

English shoes are among the best in the world and it’s a craft that is in danger of being lost. It’s all about having a product that is relevant

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RIFLING THE PAST Shooting is hip. Itâ&#x20AC;&#x2122;s not just about firing a gun but handling a brand that has been hand-crafted for almost 200 years, as Chris Porter discovers

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“It’s true that shotgun licences are in decline,” concedes Richard Purdey. “The generation that used to keep one loaded by the back door has passed on. But interest in shooting is seeing a steady increase. There’s more access to it – and it’s become a popular corporate event. However, the fact is that most people given a chance to try it instantly become hooked. It’s very addictive seeing that little black disc disappear in a puff of smoke.” Purdey, perhaps more than most, should know. In the London underworld, his surname is even slang for a shotgun, which is some back-handed accolade. A sixth-generation member of the family that established what is one of the most famous names in gun-making and director of the company which, since 1994, has been owned by the luxury goods giant Richemont, Richard Purdey learned to shoot young, even if much of his career has been spent in the premium cider industry. “They’re materially very different,” he says. “With guns you’re working with metal and wood, and of course you don’t get pissed shooting. But the process of creating a respected brand is much the same; it’s about quality and integrity.” Perhaps this is why, although cashing in on country sport’s new-found popularity might have been tempting, and given that competitors the likes of Holland and Holland and Beretta have relaunched themselves as much as lifestyle brands as makers of elite shooters, Purdey has stuck to its guns. This is the same ethos of specialism espoused by founder James Purdey who completed his seven-year apprenticeship in gun-making in 1805 and established his own business nine years later, winning Queen Victoria’s reputation-making custom in 1838. Although Purdey now has a growing clothing line – and it is considered necessary that the brand supplies shooting enthusiasts with all they need to enjoy the sport to the same functional and quality standards as the guns themselves – two-thirds of the business remains in making what Purdey calls its “raison d’etre, the guns, these works of art.”

EQUIPMENT

A high-precision mechanical belt buckle is not cheap at £10,500, but then it is hand-made from steel and rose gold and inlaid with fossilised mammoth tooth Not that the skills cannot be applied to things other than guns. One of Purdey’s latest products is a high-precision mechanical belt buckle, designed and made in a collaboration between Purdey’s gunmakers and inventor

Roland Iten. It is not cheap at £10,500, but then it is hand-made from steel and rose gold and inlaid with fossilised mammoth tooth. That the skills find other application is just as well. Works of art, of course – and it is only >>

BUSINESS QUARTER |WINTER 11

EQUIPMENT

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in the last 50 years that the decorative fine rose and scroll bouquet engraving of gun parts of the kind Purdey has been practicing since the 1850s has actually become internationally recognised as an art form – have a limited customer base. That is especially the case when only around 70 are produced each year. “Other brands may go down the lifestyle route – by virtue of the market being so small it has an exclusivity that is appealing to the lifestyle market,” says Purdey. “But I think it’s good that we stick to what we’re good at.” That, however, has not meant the company has been devoid of innovation or unconscious of the risks of resting on its reputation. Indeed, as Richard Purdey notes, companies that do not move forwards do not stand still, but tend to go backwards. Purdey has consequently launched two new styles of gun over the last year. One is the entry-level Sporter; machine-made but hand-finished, a method made possible by the advanced CNC machinery Purdey has invested in – comparable, Richard Purdey says, to Bentley launching its Continental GT while providing a means to aspire to the bespoke products and a means of funding their skills and labour-intensive creation. The company’s second new launch is a world first – the Damascus, a 20-bore over-andunder made from high-tensile steel. It was three years in development and comes with an asking price of £100,000-plus and made possible only by the recent advent of an ultra high-tech “powder metallurgy method” of steelmaking developed by Swedish steelmakers Damasteel. “It’s a flight of fancy really,” explains Purdey, “but one that shows that we’re not frightened of working with new materials or combining art with the latest technology. From a purely financial point of view everything about the project was screaming ‘don’t do it’. “But it is all the more important for a very traditional brand to express the idea that we are forward- looking. It invites comment, but it’s also inspiring to our craftsmen, who have to work out how to do it. “After all, there are not many artefacts still in demand that have not changed much materially since about 1880. We

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Other brands may go down the lifestyle route – it has an exclusivity that is appealing – but I think it’s good that we stick to what we’re good at

need to look for new ways of doing things.” Fortunately, Purdey adds, Richemont has taken a hands-off approach to its ownership of the business that has allowed such advances to be made at its own pace and in line with market demands. It has even cherished its history. Richard Purdey may be quick in his response to just why he was headhunted to join what was once the family business, but it all plays to what remains an esteemed heritage. “Well, Richemont wouldn’t have asked me to come on board as chairman if my name had been Joe Bloggs,” he says, with a chuckle. “And the Purdey name has always been there – I didn’t change it by deed poll. But of course I grew up shooting and first joined the company as an 18-year-old. Being back has felt a bit like coming home.” n

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MOTORING

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CONTINENTAL BRAKE FAST

Philip Clare takes a Bentley Continental Supersport out on the road and alarms his heavily-pregnant wife with the superb performance that the 6-litre beauty turns in

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I am an associate solicitor at Muckle LLP which is one of the leading and busiest corporate finance teams in the region. Given that my wife is now eight months pregnant with our first child, I had thought that my chances of driving any sort of sports car, never mind a supercar, were going to have to be put on hold for at least 18 years. So, when I got the chance to test-drive the Bentley Continental Supersport

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for BQ magazine I was really excited. First impressions are that the car is stunning. The version I drove was the two-seater coupe. It was black with 20-inch, 10-spoke, black alloys and slightly tinted windows. Itâ&#x20AC;&#x2122;s a great looking car, sporty, with a low stance and an aggressive appearance, especially with its large front grilles and dual bonnet vents. Itâ&#x20AC;&#x2122;s a hard core version of the iconic Bentley design.

The interior is spacious and comfortable. The racing seats look great and do their job holding you in position when cornering. The dash was a mix of black leather and silver metal which looked very flashy. The drive really is out of this world. At cruising speeds, the car is remarkably smooth and comfortable. However, press the accelerator and it really is a supercar. As soon as you put

MOTORING

your foot down, the 6-litre, V12, 620 BHP, really does kick in and the acceleration is immense. The car is stunningly fast, so much so that I was slightly concerned that showing my wife what it could really do might bring on an early labour! Remarkably, the car gets even quicker when it is put into sports mode where it seems to drop a gear (or two) and the gear changes when accelerating seem even faster. >>

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MOTORING

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What Bob says...

Given the power that the car has, you really do need to know that it has good braking – and it does. It has huge carbon ceramic brakes which mean that even at speed the braking is very responsive. I only have two slightly negative comments. Firstly, the two seater coupe I drove had a huge parcel shelf behind the driver and passenger seats. This didn’t seem very practical to me, especially since the car, rather surprisingly, has a huge boot. Saying that, I suspect if you were actually buying this car you would be buying it more for its looks, speed and all round performance than for its practicality. Still, my preference would be to have similar performance on a car with two rear seats and I understand from the dealership that there is a four-seater available. Secondly, as with a lot of new cars, you don’t use a key to open the door or start the ignition, you just need to have the key on you. This unfortunately means that you can’t check whether the car is locked because even if you lock it using the key fob, it will still open if you try the door – this is slightly worrying when you are parking a £180,000 car in town and you are slightly obsessive compulsive, like me. Overall, I loved the car. It looks great and the performance is outstanding. Bentley’s Supersport website states that the car is “engineered for a single purpose, to deliver the most thrilling driving experience imaginable”. They’re certainly not wrong there. n

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The Bentley Continental Supersport is priced at £172,600 and was provided by Bentley Newcastle, Silverlink Park, Wallsend, Newcastle upon Tyne, Tyne and Wear, NE28 9ND Tel: 0191 295 8050 www.newcastle.bentleymotors.com

I found it hard to believe the Bentley Continental was launched in 2003. This car helped Bentley to attract a new younger customer base and it quickly became a firm favourite for footballers and their WAGs. The car rapidly became a sales success for Bentley and waiting lists quickly formed at dealerships. It not only looks good but it drives really well too. Bentley also introduced the four-door Flying Spur and the GTC a luxury convertible. By autumn 2009, Bentley introduced the Supersport and this car is much more hardcore compared to the original Continental. The engine has been tweaked to produce 621bhp which helps propel the car from 0-62mph in 3.9secs. Its top speed is 204mph, which makes this the most powerful production Bentley – ever! It sounds very raw and savage, it handles really well and it also feels somewhat lighter compared to the Continental. Bentley has gone to extreme lengths to reduce the car’s weight and massive ceramic brakes are the most powerful ever fitted to a production vehicle. The company has also fitted lightweight alloy wheels and the standard wood trim has been ditched in favour of lighter carbon fibre. The rear seats have been removed to reduce weight and replaced by a roll cage. The car has also been fitted with a quick shift system and this new gearbox helps reduce shifts by 50% meaning gear changes are performed at lightning speed. Although the Supersport cannot be called a bargain at £163,000 it is an ideal motor for someone looking for a sporty alternative to a Ferrari or Lamborghini. Bob Arora is an independent car reviewer and also owns Sachins restaurant on Forth Banks, Newcastle.

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INSIGHT

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BANKING ON TRADITION

Despair not. Banking still has some respect for the traditions that customers wish to see revived. And some of us are already enjoying their return, as Brian Nicholls discovers

In some gratifying ways, Kevin Pattison’s banking career has turned full circle. Here he is, back in Newcastle’s gracious Grey Street 30 years after beginning his banking career there. And here he is, in charge now and restoring some traditional services that many bank customers generally are appealing for. Progress has been commendable, then, since he was the counting house teamaker. He is Newcastle branch manager of Handelsbanken, the 140-year-old Swedish bank which, unlike much of the disconcerting competition today, pays no staff bonuses (“a breeder of wrong behaviours”), gives its branch managers autonomy, sets no budgets or targets, is unconcerned about market share and volume of business, and shuns call centre methods.

It does, though, embrace 21st century technology, and for its customers the branch is in effect the bank. Measured against its global competition, Handelsbanken is relatively small. But its branches and subsidiaries worldwide still employ more than 11,000 staff. Pattison not only launched Handelsbanken’s first North East branch in Grey Street in 2002, but is now engaged with the opening of a second branch in Newcastle, which will also be fifth in the region. A Haymarket facility is expected to open during the second quarter, with further branches to follow at Durham and Darlington. The manager at Haymarket will be a Pattison team member, Mike Brunskill. The expansion comes as research by the

Tea and empathy Kevin Pattison’s banking career began with the old Midland Bank in Grey Street around 1980 – “the tail end of the era we remember as golden years in local banking,” he recalls. As an apprentice in kind he not only made the tea, he also counted cheques and credits, and later was let loose on the counter and foreign securities. He was liable, as his career developed, to tackle anything, whereas today, as he points out, specialising prevails in the sector. In 1985 he joined the Co-operative Bank in Newcastle, staying until 1991, then worked with the Nationwide Building Society. He returned to the Co-op Bank until 1997, when he was invited to join the Yorkshire Bank. With the Co-op Bank he worked in Manchester for some time and at the Nationwide he covered an area from Teesside to Humberside. He was with the Yorkshire when he got a call from Handelsbanken in 2000.

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Institute of Chartered Accountants in England and Wales (ICAEW) suggests that relations between many banks and small business clients are breaking down. Some small and medium size businesses feel “bruised” and “scarred” by treatment from their bank during the recession, leading to a disappearance of whatever trust existed earlier. ICAEW findings also suggest breakdowns have worsened through a perceived lack of authority among the banks’ relationship managers, often seen now as unsupportive of their clients, and reliant on tick-box mentality to reply to loan and overdraft applications. Hotelier Mukesh Chawla, however, says at The Mercure Newcastle George Washington Hotel Golf and Spa that he considers Handelsbanken very understanding of business needs. “Unlike high street banks, they are very flexible – easy to deal with,” he says. “I consider the business perception and understanding of the Newcastle staff second to none.” The ICAEW check also confirms that, despite current low interest rates, fees, charges and margins banks require have risen, and the ICAEW wants offending banks to restore trust and business growth by repairing damage done. Handelsbanken, meanwhile, has opened almost 100 of its near autonomous branches in Britain since 1992, 21 in 2010 alone. Decisions on funding are taken at branch |level, and some 95% of credit is granted that way. Handelsbanken also says it will consider any banking proposition, and it’s perhaps not surprising in light of the ICAEW findings that it now wants to see “small and medium businesses having easy access to a universal bank”. It’s commonly argued in Scandinavia about whether Handelsbanken is Sweden’s biggest or second biggest bank. Here, because it keeps a comparatively low profile, its ways are still understated. Pattison himself admits: “I hadn’t heard of Handelsbanken when I got a call inviting me to join it in 2000. And there had already been branches in this country for nearly 10 years then. It was all very new, different, unique. I thought it too good to be true – head offices existing to help branches in need, not to run them. And where local managers can feel

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INSIGHT

I thought it too good to be true, head offices existing to help branches. Our customers get a service like other banks used to give three decades ago

they’re almost running their own business... Our customers get a service like other banks used to give three decades ago when I started out.” Every branch manager has detailed knowledge of the local patch, and manager and staff alike know customers personally. The branches, planned to sit among their customers, run on a “church spire” principle, with a clearly defined geographic area. How many managers of other banks these days can claim to recognise many customers by their voices on the phone? Branches remain risk averse, however, and

managers do operate a daily profit and loss check. “We don’t take on bad debt,” says Pattison. But nor do they do financial services, pressing sales of insurance or other financial services. However, says Pattison: “You can pick up the phone to arrange a loan for a car or a mortgage and there will be no two weeks’ wait for a decision. A financially stranded holidaymaker rang us from abroad recently and we sorted the problem in 10 minutes. We run like a business, appraising everything on individual merits and on a bespoke basis.” David Dale affirms this. He feels much of the

banking sector has lost its way by targeting towards selling products and overacting with advice. Dale, as wealth partner of law firm Dickinson Dees, looks after the affairs of a number of wealthy individuals and serial entrepreneurs, and he chose to switch his personal banking to Handelsbanken. He explains: “I wanted as a bank manager someone local who could understand me and my family and, bluntly, ensure I have service at the end of the telephone. I didn’t want a call centre, didn’t want it centralised. I wanted a real person. I found that a real challenge. A number of banks, I found, say they provide >>

BUSINESS QUARTER |WINTER 11

INSIGHT

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But does he really let the paying guests treat the house as their own? Don’t they take advantage? “Honestly, we’ve had no problems,” he says

that service. Early on they tend to. Then you may be factored off to a call centre which, even if local, will be someone you really don’t have a relationship with – you don’t know who you’re speaking to. I realise that on scale of economy that’s why it’s done. But it’s not what I and a number of individuals want. “I also want someone who understands my banking needs and aspirations – someone who can make a decision. I recently wanted to look at my mortgage facilities. I wanted someone to provide a good competitive rate of interest. I wanted it from day one without any lengthy process after which someone would try to sell insurance. “I didn’t want to return home in the evening after a long day at the office and find, usually just before the watershed five to nine, someone phoning from the bank to say: ‘Would you be interested in X,Y, or Z investment or anything else?’ “That used to annoy me, bearing in mind I do that for a living – but also because of the time of the call. When I queried that with my personal bank manager, with whom I had a great relationship, he used to say: ‘Yes, David, I understand, but there’s nothing I can do.’ That made me look for an alternative. “As far as I can see, Handelsbanken is not fighting for clients like many banks. It wants you to get the best point to point contact of local service from someone who understands you. So I recommend a lot of my clients and family to the bank. It’s banking as we used to know it.” Handelsbanken leads in an independent survey of Swedish bank customers that it commissions annually. In Britain a similar outcome has emerged two years running. What are the drawbacks, then, sceptics may rightly ask? Handelsbanken, though not a

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franchise, in some ways works like one. There are no direct over-the-counter dealings but agency arrangements whereby HSBC branches will serve the purpose for corporate dealings, NatWest for personal ones. One or two products have yet to be introduced to the UK, but probably will be. And debit and credit cards and online facilities are already provided. The bank has been criticised as “too liquid” – holding on too much money. Asked how its lending and investment rates of interest compare against competition, Pattison at the time of interview felt investment deposit rates were fairly average, perhaps just below average at that point. “We may be offering less than one or two other banks and building societies,” he agreed. “But there has been a customer flight to quality in banking, and we’ve increased our deposit base through our safety offering. There’s no matrix of standard charges on lending. We price everything on a bespoke basis. We’re not the cheapest.

Definitely a Joiner Mike Brunskill, who will manage the new Haymarket branch, has been in banking since 1974 and was in industry for two-anda-half years previously. He has been with Handelsbanken for almost four years. He is president and treasurer of Morpeth Rugby Club and treasurer of the Mental Health Foundation. He enjoys golf, travel and time with friends in his local, The Joiners Arms in Morpeth.

“The charge depends on the purpose of the loan, the quality of the customer, so we may not be everyone’s cup of tea. Some may prefer to keep their banking impersonal and use 0800 phone numbers. We, though, are very transparent.” The existing Newcastle branch has 600 customers, with corporate and personal divided about equally. Since there are now more than 63,000 companies in the North East, not to mention a plethora of private customers, other banks whatever their shortcomings may have little to worry about yet over any massive loss of market share, unless perhaps other Handelsbankens of the region enlist much faster. But Pattison points out: “While we are not necessarily seeking out high net worth in customers we are looking for above-average customers – quality customers.” So many customers come recommended, either by existing customers, professional contacts or are known to the managers and their staffs. The welcome mat, it appears, is put out selectively, and the phrase “cherry picking” comes to mind. “We go for the business we think suits the local market,” Pattison clarifies. “The absence of centrally-driven markets in our view drives the right behaviour.” The bank’s main objective in performance, as yet, seems little more than to get the best return on equity within its Nordic peer group. “To do that,” Pattison observes, “we are frugal in outlook when it comes to expenses and things like that.” Locally, he says, the business model is proving highly successful. “Activity levels show significant growth across the patch in all aspects,” he says. “Our banking base of individual customers has more than doubled in two years and we attract new customers daily – always through our offer of relationship banking. “For both corporate and other sectors, our desire to take on full transactional day-to-day banking business is resulting in strong growth as well.” It has you thinking that if some other banks took a tip or two the public benefits could be widespread indeed. The ICAEW might think so too. n

Sunderland open for business

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For more information call the Business Investment Team on 0191 561 1171 or visit: www.sunderland.gov.uk/economicmasterplan

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COMPANY PROFILE

Hay & Kilner’s expert commercial teams advised Dene Group on all legal aspects of their business expansion

HAY & KILNER HELPS FILM PRODUCTION COMPANY SECURE FUNDING

EADING Newcastle based law firm, Hay & Kilner has assisted one of the North East’s most successful film production companies, Dene Group, to secure nearly £800,000 in funding. Hay & Kilner’s commercial team worked with the group and its subsidiaries, including Dene Films, Qurios Entertainment, Metropolis Pictures, Imagine TX Post Production and IPTV development company Studio Riff Raff, to assist in structural changes as it bid for the funding. The £795,000 injection will allow Dene to move into larger premises in the Ouseburn Valley, while also investing in the latest HD and 3D editing technology and boosting its workforce. The investment was largely made up of £500,000 from the Growth Plus Fund, managed by FW Capital, alongside £150,000 from the Growth Fund, managed by NEL Fund Managers. Hay & Kilner were able to successfully assist Dene with all legal aspects of the deal including corporate finance, employment and property related issues. Partner and employment law expert, Sarah Hall prepared service agreements for the directors at Dene whilst Gail Marshall, an associate solicitor within Hay & Kilner’s commercial property team, advised on the property aspects of the financing and will also be working with Dene in relation to their relocation to new headquarters in the Ouseburn Valley. Mark Adams, a partner in corporate finance, led the Hay & Kilner legal team. He covered all aspects of the restructuring and investment for Dene and commented: “This is a fantastic opportunity for Dene to expand its presence and further enhance its growing reputation both locally and nationally. We were delighted to work with Steve Salam

Steve Salam, Managing Director of Dene Films with the Hay & Kilner team (L-R, back row) Sarah Hall, Mark Adams and Gail Marshall.

HAY & KILNER HAS CONSISTENTLY PROVIDED EXCELLENT SUPPORT TO THE DENE GROUP, WHICH HAS HELPED SECURE THIS FUNDING again and are sure that Dene will continue to go from strength to strength. Its investment in the latest HD and 3D editing technology is an exciting prospect.” RMT’s director of tax Sarah Arnold provided strategic and taxation advice. Dene Group is a multi-award winning production company, working in commercials, corporate, broadcast and on-line television. They have produced almost 5,000 commercials, corporate films and broadcast TV programmes, including TV adverts and an upcoming 3D historical recreation of Vindolanda. Managing Director Steve Salam said: “Hay & Kilner has consistently provided excellent support to the Dene Group, which has helped secure this funding. We now have the funding we need to realise

our ambitions and we look forward to creating new jobs in the region and building the reputation of the North East as a centre of excellence for film making and production.” About Hay & Kilner Solicitors Hay & Kilner, a 25-partner Newcastle based law firm, offers a complete legal service to individuals, corporate clients and institutions, locally, nationally and overseas. Recommended in 23 work areas by independently researched legal guide The Legal 500, Hay & Kilner is ISO 9001 accredited and holds the Law Society Lexcel Quality standard.

For more information visit www.hay-kilner.co.uk or call 0191 232 8345

BUSINESS QUARTER |WINTER 11

ENTREPRENEUR

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On the crest of a wave Who says the old shipyard skills are lost? They’re amply in evidence in Chris Millman’s fleet of activities at Blyth. Brian Nicholls reports If you ever feel nostalgic and long for the once-familiar sound of metal bashing in our manufacturing, or hanker to see again catherine-wheel wonder sparks from the skilled welder going about his business, you could maybe ask Chris Millman for a peep inside his boatyard. His firm, Alnmaritec, is currently building 29 boats – yes 29 – as it runs down its Alnwick operation and transfers all activities instead to its recently-acquired site at Port of Blyth. A waterfront visit to the fabrication shop there would cheer anyone anxious about the survival

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of traditional skills in North East industry. True, no new Ark Royals or Mauritanias are coming up – this is, after all, a boatyard not a shipyard – but to us, it seems a cause for pride, especially since so many of the boats in this highly competitive sector are for customers abroad. Alnmaritec’s aluminium boats will be found under diverse ownership in 25 countries anywhere from Greenland down to Antarctica, from West Coast America east to China. They serve activities such as offshore and renewable energy, fish farming and fishery

protection, piloting, patrolling, researching, ferrying and supplying. Millman’s is a remarkable feat achieved mostly during the past five years since he, a naval architect, bought the company and resolved to give it world esteem. The firm, owned earlier by Tyne Tube Services, had largely been into various activities, notably steel deckwork for Tyne-built ships, since steelworking began at Alnwick during the early 1960s. “I assume it was a way at the time of putting industry into Alnwick,” Millman surmises.

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“It then started building aluminium structures too – gangways, and various other constructions. In the late 1980s the main thrust for building aluminium boats was in Scotland’s fish farming industry. “Then aluminium boatbuilding went downhill as shipyards elsewhere fell away and eventually that business was wound up. The whole company was bought by a group with a diverse range of interests. They had the fabrication company that built The Angel of the North, hydraulics, and restaurants and hotels. They decided to sell their engineering businesses. I bought that division and set up as an independent company.” Millman brought in not only his personal skills and knowledge as a naval architect but a host of valuable contacts nurtured over many years, many indeed potential customers. He had served his time with the Ministry of Defence working on Royal Navy ships and had worked in shipyards all over the world, including Dubai, Canada, the Tyne and most recently in the Bahamas where he had set up a cruise ship repair yard in early 2000. A keen sailor himself – “I’m boats through and through” – he recently celebrated his 50th birthday holidaying aboard his own sailing boat. On return to the North East from his Bahamas assignment, he had looked around for opportunity. He did not have to look far. He and his wife Bernie, who runs human resources and administration at Alnmaritec, live with their 10-year-old son Thomas near Wylam, so his became a doorstep decision. “There were a few opportunities going but this suited my background, contacts and skills,” he recalls. “I had been entirely in big ships but that was relevant because here we don’t sell to the general public, as we might yachts. We sell to companies as builders of big ships do, and many companies we sell to now are ones I had dealt with over many years. I had to convince the banks it was a good idea – a lot easier then than I think it would be now.” Is there much difference between building big and small? Alnmaritec craft may vary from a five-metre skiff up to a 30-metre catamaran. “In many ways you get more satisfaction building small because it’s more immediate,” he says. “You can design and draw something up and it’s being built the next day.”

ENTREPRENEUR

We try to be proactive in design because technically and professionally it’s more satisfying building lots of different boats than the same type all the time Working on a warship, by contrast, could span 10 years and Millman in his previous career could find himself having moved on to other projects long before the ship was launched. ”It is satisfying now also that so many of our boats are being exported to different parts of the world,” he says. How does such a small company assure its

position in global company often bigger than itself? At home there is competition on the Isle of Wight and in Plymouth, Portsmouth, Holyhead, Ireland and Scotland. Overseas in one market or another it exists in Norway, Australia, the US, Holland, France and Finland. Alnmaritec’s order chasing overseas is supported by agents in 14 different >>

Here, there, everywhere A quick look at the current 29 boats on the order books gives a good insight into the firm’s versatility: Two oil pollution boats for Iraq, one windfarm support boat for a Danish customer, three patrol boats for Port of London, a research boat for Newcastle University, a pilot boat and two others for an energy terminal in Angola, a research boat for the Environment Agency, a harbour workboat for a Danish port, a supply boat for a bunkering company in Gibraltar, three more windfarm vessels for different operators, two pollution boats for PetroChina, two dive boats for a Scottish company, three pilot boats for Antwerp, three other boats for Angola, a patrol boat for Qatar. All these are either on the books, on the stocks or in production.

BUSINESS QUARTER |WINTER 11

ENTREPRENEUR countries, many of whom have worked with Millman for a long time. “We also do lots of trade shows and overseas promotions,” he says. “We have a lot of markets to go at because of our involvement in different sectors. “That’s how we like it, as many different eggs in our basket as possible so we can target different markets and geographical sectors.” The company is particularly proud to have just sent two aluminium catamarans to Australia – “basically the equivalent of selling coals to Newcastle in previous times” – but it illustrates why Alnmaritec’s particular niche so often pips the competition. “All our boats are custom-built,” he says. “The Australian buyers had been told by their own yards that they would build a series but were not particularly keen to build one type of boat only. “We, however, try to be proactive in design because technically and professionally it’s more satisfying building lots of different boats than the same type all the time. We want to be seen as someone who gives a customer a boat bespoken to their particular operation rather than a standard product that you can botch and bodge, never actually doing the job it’s wanted for. “It would be lovely if, sometimes, someone came along asking for a series of 20 or 30 boats, but normally any series of ours is restricted to two or three. But while we aim to be competitive we don’t seek to provide a cheap mass-produced product. Our aim is a product that perhaps few others are willing or able to get their hands dirty designing. “Our project teams here are very close to the workshops. Things can go straight from the drawing board onto the cutting machine and into the fabrication hall. Sometimes it is only a matter of hours. That is something customers value, they know designing and customising go hand in glove. We are not trying to work to someone else’s design maybe 500 miles away.” Millman has increased the firm’s turnover tenfold in five years, from £1.7m to £17m. To reap full benefit and maximise the competitiveness, an orderly withdrawal from Alnwick will shortly be completed. The new site within Port of Blyth’s precincts is presently

BUSINESS QUARTER | WINTER 11

WINTER 11

Going with the wind Alnmaritec built the UK’s first offshore windfarm support boat. It went into service at Blyth where the country’s first two offshore wind turbines were planted. It has since been in that offshore sector for 10 years. Surprisingly perhaps, the proximity of Alcan’s aluminium smelter at Lynemouth doesn’t help Alnmaritec. Says Millman: “Its aluminium goes to mills and stockholders, so it all probably sails past us in the pool, goes on to Holland or somewhere then is shipped back here. Not very environmentally friendly, really.”

a collective of warehouse sheds and prefabricated cabins, very confusing for visitors to find their way around. But Millman explains: “Our long term plan is to invest and develop here at Blyth. The site is relatively new to us. We’ve only been here for around a year, and some parts we have not even moved into yet. It has unlocked a lot of the potential we want for expansion, a facility where we can build bigger boats. “And of course, we’re on the water here which we weren’t previously. So our strategy is to build up the facilities, the infrastructure, the workforce and the capabilities of this site and try to stamp our mark on the marketplace. The firm currently employs 160 – 22 in design, technical and administration work and the others in blue collar production. And 87 have been taken on since last July. “The vast majority have come to us with a very valuable skill set from offshore and other fabrication firms, and shipyards,” says Millman. “It has been an absolute asset to be able to tap in like that. A credit card-size advert in the evening paper brought us about 400 applicants in a week. In many ways it was sad to see the number of skilled people looking for work.” For a long time building was carried out inland at Alnwick then completed craft were brought down to North Shields where the company had a berth. “It wasn’t ideal if you were trying to fix things and had left a screw back at the factory,” Millman observes. “It was an hour-and-a-half’s journey to go and pick it up.” The company announced just before Christmas that the Alnwick operation would be run down over six months and the entire operation continued at Blyth. “Historically, Alnwick is where the company has been based and it was a tough decision,” he says. “But with two sets of insurance, two sets of heating and lighting and two sets of security involved we could have put the company in jeopardy. And the long and short of it is that Alnwick was never a good place from which to build boats and never will be. “The vast majority of the workforce understood it was better for the business and indicated they would be prepared to come with us.” n

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INTERVIEW

WINTER 11

AND SO TO BED Colin Heal, who has been running one of the country’s top independent bed sellers for 19 years, tells Brian Nicholls of his relief that people are now more knowledgeable about the best kind of bed for their needs BUSINESS QUARTER | WINTER 11

Whatever our other discomforts, many of us do seem to be sleeping more peacefully these nights. Despite the slashbacks in our personal spending more customers are now buying bigger beds to spread out on. The trend has been noticeable even throughout the recession, according to Colin Heal who runs a major group of bedding stores throughout the North East. “People are realising there’s a better quality of sleep to be had through buying beds that are a lot bigger,” he says. “A standard double bed is four feet six inches and if it’s for two people of normal size, basically each person is sleeping on a two-foot, three-inch bed. That’s actually smaller than a cot. “When you explain that to people and ask how they’re going to get a good night’s sleep on a bed smaller than a cot they now normally switch to king size – or super king, which is six foot, basically two single beds. “You’re getting a comfortable sleep on those,

WINTER 11

and so is your partner, because you’re not kicking them or whacking them in the face. Even if you don’t waken them through the night you’ll disturb their sleep pattern.” He says many customers are already aware of these advantages when they visit, apparently picking up their knowledge on the internet. The Monomarket group of which he is general manager is entering its 25th year in business noting also that in that time more customers are acknowledging the health aspect to bed buying. Heal explains: “Many people come in having wakened earlier with a sore back. They realise they need a new bed. Sadly, they’ve suffered too long. Beds should be replaced every eight to 10 years. “You hear of people who’ve had their beds 30 or 40 years and you think: ’Oh, oh.’ “Our business is selling beds but we don’t do a hard sell, more a consultation. We try to educate our customers about beds. People who wake up in pain may not be unwell but only in need of a new bed and not a new back. Maybe they need a pocket sprung or memory foam bed.” Pocket sprung mattresses have individual springs sewn into linked fabric bags. Memory foam mattress moulds to the shape of your body. Under Heal’s direction – he has been with the firm 21 years, 19 as general manager – Monomarket has grown into one of the country’s biggest independent providers. It employs 65 people and to shoppers it’s better known probably under the names of its individual stores in the region: New Bridge Street Bedding Centre in Newcastle, Portrack Lane Bed Centre at Stockton, Sunderland Bedding Centre and Northgate Bedding Centre in Darlington. About 800 beds are always on display on the four stores’ total floor space of 60,000sq ft. The group is also adding reach with a Mr Mattress website. Its head office operates cosily within the Newcastle store and it has its warehouse a couple of miles away, near Brough Park sports stadium. The Newcastle store, which has remained in the same premises throughout, was followed by Sunderland 16 years ago, Northgate 12 years ago and Portrack seven years ago. Heal

Beds should be replaced every eight to 10 years. You hear of people who’ve had their beds 30 or 40 years and you think: ’Oh, oh.’ started as a salesman when managing director Geoff Gale took him on at 20. Heal recalls: “I’d worked for another bedding firm before, in Sunderland. It started getting into difficulties. I knew this company had a good reputation. I phoned Geoff on spec and asked if there were any positions going. He asked my background, and said he hadn’t any vacancies but asked me to come in and see him. “I saw him that afternoon. A few days later he offered me a job selling on the floor. It was all hands-on and good. Two years later I was

INTERVIEW

promoted. I was one of the youngest in the store, so I had a task on my hands. Geoff didn’t know the risk he was taking, having a 22-year-old as general manager of a store.” The truth is that Geoff Gale probably recognised personal ability. He had earlier been a director of Newcastle’s once famous East End department store, JT Parrish, which finally closed its doors on Shields Road in 1984 after more than 100 years of trading. He and his wife Gill, his present co-director, launched their own business at New Bridge Street. Today the single shop unit which used the upstairs and basement for warehousing initially has expanded through four units on New Bridge Street, and the company prides itself on staff retention. Store manager Alan Scott, for example, has been with the firm 24 years. Heal says: “I grew up with the firm and had terrific mentors because I can’t praise Geoff and Gill enough. The company has moved on and on to what it is today. We don’t stand still. We’re very pro-active. That suits me because I like to keep my mind occupied.” Hence perhaps his cogitative leadership. “A bed for us is not a quick sell,” he explains. “Buyers are going to sleep on a bed eight hours a day for 10 years. So we expect them to spend a >>

BUSINESS QUARTER |WINTER 11

INTERVIEW

WINTER 11

couple of hours choosing a bed, or even up to a week. We’d rather you spent as long as you wish in the shop and be sure you’ve got the right bed. People I’ve sold beds to have actually said to me later something like ‘you’ve changed my life for the better’.” One past customer, unsolicited, whom BQ spot checked confirmed: “The service we got when we bought a bed there was brilliant – no big sell but lots of useful information. We took hours to make our minds up but came under no pressure. We’ve recommended the store to our friends.” The customers are advised to consider four things: Price, support, comfort and aesthetics. “A bedstead, after all, is a piece of furniture you can design the rest of the room around,” says Heal. “And, because it’s covered, some people think a bed’s just a bed. No. It’s the most important item in your house. You spend more time on that than you do on your sofa. “If you have a good night’s sleep you have a good day. If you have a bad night’s sleep you can have a horrific day being tired and grumpy, feeling aches and pains and quite worn out. One suspects he practises what he preaches because here he is, not having lunched yet still full of vitality despite his long daily walk hours earlier with his two labradors at Newton on the Moor, near Alnwick, where he lives.

BUSINESS QUARTER | WINTER 11

When he talks about changing beds he also means changing mattresses. “Your mattress needs a good foundation as part of the whole – unless you go for a bedstead, and then you should still replace the mattress every eight to 10 years,” he advises. One of the most striking aspects of the merchandise is the advance in technology. There are now electric beds adjustable for people with mobility or circulation difficulties. Others with breathing difficulties can adjust these beds to lie more upright. There are airbeds; pillowtop mattresses give an extra layer of soft cushioning, and single-sided no-flip mattresses are now common. Water beds, far from novel, were used in Persia more than 3,600 years ago. They were then made of goatskins. Heal reckons water beds are probably the healthiest beds. “The media has made a thing about them, and while not to everybody’s taste they are very healthy for comfort and support, and they can be cleaned.” A familiar story, sadly, is the decline of mass British manufacturing in yet another profitable and fundamental sector – this one going back 10,000 years. “Twenty-five years ago 95% of product was from Britain,” Heal recalls. “The divans in general still come from Britain, but a lot of beds are being imported from the likes of Malaysia, China and Brazil. “It’s cheaper to manufacture there and sell them here despite the cost of shipping them over in containers. The workmanship in Malaysian beds is particularly impressive.” Whatever the origin, Heal believes that

BED FACTS The expression “sleep tight” comes from the 16th and 17th centuries, the Better Sleep Council says. That was when mattresses were placed on top of ropes that needed to be tightened regularly. Bedrooms were rare in homes until the 17th century, and beds were common in every room, also being used as daytime couches.

independent sellers must always have specialists at hand to inform the public authoritatively and educate. He says: “There’s always competition. But in our business if you have the right advertising, the right sales staff and the right stock you’ll do well. Yes, you have to be aware of what the competition is doing. But we concentrate on our own business first.” In line with the low profile the Gales themselves keep, company figures are not discussed publicly. But the group does about 100 deliveries daily, five days weeks, its items ranging in price from a £30 mattress to a £5,000 bed. The firm prides itself on quick delivery because of its large stock. Heal says: “A lady recently phoned from Keighley wanting two electric beds urgently. By eight o’clock that night she had the two electric beds fully installed by two of our staff who drove with the beds to Yorkshire. We’re always prepared for panic buys of any kind.” Of pressures existing on retail sales generally, Heal agrees: “There has been some easing off – that’s no secret. But hopefully we’ll be coming out of this recession stronger than ever. If you put your head in the sand you’ll falter. We’re positive and go out to get the business that is there. You have to give unprecedented service, though. If you don’t, your customer will go somewhere else.” n

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IN ANOTHER LIFE

WINTER 11

An inspector calls As a trained architect, I have a licence to organise space. I am required to assess all needs and restraints a building will have placed upon it, then design a practical and aesthetically pleasing solution. As the saying goes “the devil is in the detail” and it is something that from an early age in my career I realised was vital to my job. It is also something that has strayed into my personal life. Because of my dedication to detail I have a pair of the most critical eyes in the hospitality industry. Immediately I step foot into a new hotel or bed and breakfast, I find my eyes scouring the unknown land. As my mind relishes the task at hand, I can feel myself slip into my surreptitious role as a frustrated hotel inspector.

Rob Charlton, chief executive of architectural business _space group, oversees the firm’s three offices in the North and its 130 people. Busy enough in his day job with the company named one of the best to work for in the Sunday Times listing of 2010, Rob still finds the time to indulge his passion for travel. And in another life, he says, he would have hoped to be...

From the reception layout, interior design, staff service and facilities to the working order of the air conditioning, all areas are critiqued. It is now something my wife Diane also joins in with – we are a double act when it comes to being part time hotel inspectors, paying particular attention to the levels of customer service. The inspection of buildings isn’t too far a cry from my own career. It is part of my keen eye for detail which covers many aspects of architecture, from design work through to property site inspections and facilities management. And my particular focus on service excellence is a key perquisite for any successful business – it’s the cornerstone for good client relations and reputation.

However, I am one of the lucky ones, as from a young age I was blessed with knowing what I wanted to be when I grew up; an architect. My grandfather was a builder and one of my earliest memories was going down to watch him work at the Montagu Court site in Gosforth and seeing buildings grow out of the ground. From that point on my fascination with building design and construction was born. Architecture is currently a shifting landscape, but I relish change. There is a lot of growth to come in the digital side of the industry and _space group is firmly establishing itself as one of the leading building information modelling technology companies in the country. All things considered, I think I made the right career choice, but I will always keep my hotel inspections as a secret hobby. n

BUSINESS QUARTER | WINTER 11

...living a peripatetic life out of a suitcase, inspecting and experiencing some of the world’s best hotels as an hotel inspector. Here he tells why

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START THE QUIET A cheeky half won't hurt,just to be sociable... REVOLUTION towards one end or the other depending on We’ve all heard the urban myths about some whether you want to be cautious or adventurous. poor unfortunate who’d saved diligently into a pension all of their life, investing it very cautiously, Lets say that you want a ‘low to medium degree’ only for it to all but disappear in some stock of risk. We are going to ignore the fact that ‘low market crash a week before they were due to to medium risk’ is a subjective term as one mans THE WORLD’S FIRST FULL HYBRID retire.Well unfortunately there’s nothing urban or merry-go-round is another mans roller coaster, LUXURY mythical COMPACT about it. It canCAR. and does happen. The but that’s for another blog. mystery is how something that they thought was To achieve this you may have 80% of your monies The is leading a quiet revolution. so Lexus cautiousCT and 200h low risk could be so…..well, risky. in defensive funds and 20% in growth funds. is a funny oldfull thing when itsystem comes to your ItsRisk sophisticated hybrid creates Sounds pretty low risk for a 40-year strategy money. As in life, you need some risk otherwise doesn’t it? near-silent driving in electric mode, with there’s no reward. Even bank accounts carry risk; In terms of a night out, that’s the little pep talk you class-leading emissions andorsuperb either that thelow bank will go bust that thefuel efficiency. give yourself in the bathroom mirror before you interest paid is less than inflation and consequently It delivers a truly rewarding driving experience, head with for the town.‘Only have toast to eat before your capital can die a slow and painful death. If you you go out, take the first three pints easy and do smooth acceleration and agile handling. want to make big gains then you need to head not under any circumstances, end up in a round towards the the higher risk investments quality, like stockscomfort and And all with award-winning with Big Dave’ and shares. The trade-off is that the volatility of refinement that Lexus is renowned for. Now, defensive funds are designed to protect these investments may not be for the faint their capital and make a bit of a return on top, hearted. sneaking a bit more than inflation. ToSo, find aboutthat thebegins newlife as low hopefully howout canmore an investment Growth funds on the other hand are designed to end upcall being high 215 risk without CTrisk,200h 0191 0404you or doing grow and make solid returns well above inflation anything to it? Well, it’s a bit like a night out really. in the longer term, but at times may be worth less visit Youwww.lexus.co.uk/newcastle start off all demure and sensible but left to than you invested. your own devices for long enough and ‘I Will LEXUS NEWCASTLE So lets imagine the scenario at the end of year Survive’on the Karaoke starts to seem like a good one for our cautious portfolio that we cobbled 22idea. Benton Road, together earlier. The defensive funds have done When you save in 7EG a pension, you are offered a Newcastle NE7 fine and produced a 5% return.The growth funds choice of what type of investments you want have done even better, as expected and your monies to go in to.This choice will stretch produced a 12% return.This means that the 20% the full risk scale from very cautious cash accounts growth bit of your pot has grown a little bit faster right through to potentially volatile stocks & than your 80% defensive bit and overall your pot shares. is now 79% defensive and 21% growth. It’s just If we draw a line down the middle of this scale decided to stop for a bag of chips on the way to then those to the lower end like cash, gilts and the pub to ‘line its stomach’. bonds we refer to as defensive assets. Those to At the end of year two it is 78% growth and 22% the higher end like shares, we call growth assets. defensive and it’s just ordered its second pint. Property funds can be argued into either side After five years it is 74% and 26% and has just depending on how many pints you’ve had. challenged Big Dave to a yard of ale race.You can A good pension will have a selection of funds imagine where it will be in forty years time….. spread across this spectrum, but weighted And so it goes on, getting more aggressive as

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MEDIA BRIEFS

WINTER 11

>> You can if he Caan

The Scrutator >> Pitching with some prospect Seeking investment? Well, remember a complimentary video supports the Elevator Pitch facility. This web offering by North East Access to Finance (NEA2F) is a guide for entrepreneurs and small and medium businesses. The four-minute video, Dragon’s Den-flavoured, allows secure uploading of a 90-second slot allowing a pitching of ideas to professional investors. Hugh Morgan Williams, NEA2F chairman, points out that the ideas go to investors in and beyond the region. Angel investors are particularly pleased by the standard of the pitch guide. Newcastle film makers Superkrush produced Your Guide to a Successful Elevator Pitch. www.nea2f.co.uk/elevator-pitch/ what-is-needed, (A subtitled version of the video is also available).

Stake a claim: You can make a pitch for North East investment

>> Shake-up predicted What chance a burst of media mergers this year? Paul Mankin, corporate finance partner at PwC in Newcastle, thinks possibly so. He reckons private equity firms, significant acquirers of media assets over the last five years, are readying assets for sale.

BUSINESS QUARTER | WINTER 11

Mention of Dragon’s Den reminds me, whether you’re a school-leaver, a chief executive hungry to escape a purge, or one of half-a-million unfortunates who expect to be shaken from the public sector, you’ll find James Caan’s new paperback Get the Job You Really Want invaluable. I’m no Den fan so Caan’s departure from it doesn’t move me. But this guide of his does, for both its soundness of advice and its lucid style. Even those of us happy in our job never know when it might be required reading. (Portfolio Penguin, £12.99).

>> To the rescue Mandy Russell helps suffering SMEs on the click of a button. Her firm Mpower in Northumberland gives bespoke training and coaching packages, and now, for less than £2.50 each, her eBooks can be downloaded. She calls herself a former “big-wig of the corporate arena” and advises in the present economic climate: “Take small cost-effective steps and seek out innovation in your business – and in your life.” www.mpowerinternational.co.uk

>> A pearl for Dene The award-winning North East independent film and television producer Dene Group, despite these straitened times, has secured investment of £795,000 to expand its work and invest in new equipment. Set up 19 years ago by six-time Royal Television Society winner, Steve Salam, the group works also from London and Manchester. It claims to be the largest provider of commercials to ITV regionals. Its first network TV commission, a documentary, is on Michael Palin’s centre for children with speech difficulties.

>> Off beaten trails Lesley Gosling, well known PR practitioner, has set up a company to draw us into lesser known Northumberland: www.whatsspecialabout.com uses familiar broadcasters as her guides narrating on CDs for the car. The former listed buildings inspector turned TV entertainer John Grundy, in 20,000 words and 20 tracks, takes us along the byways. The Corn Road, described as “the 18th Century Newcastle bypass”, starts outside Hexham and finishes in Alnmouth on the coast. Meanwhile, The Coast, The Country and The Cattle Trail goes from Alnwick to Warkworth the long way round – a 70-mile journey in fact. Eric Robson, now chairman also of Cumbria Tourist Board, will narrate routes through Cumbria. Marian Foster, a stalwart of BBC local radio, links between the tracks. Further routes will follow. The website offers sample tracks and opportunity to download onto i-Pods or MP3 players (£10) – or buy the CDs online (£14.99 +p&p).

>> One for the visitor My suggestion of a parting keepsake for any foreign visitor to a business has to be a beautifully produced and illustrated pocket book called The Little Book of the North East. It recounts not only the region’s history, geography and economy, but also its culture, sport and politics – touches on regional identity too. Packed with personalities past and present, it seems however to have omitted classical music, hence no Charles Avison, Northern Sinfonia Orchestra or Sir Thomas Allen. No sign of Ian Carr either, whose trumpeting changed British jazz. A small grumble about a big success, though. The Little Book of the North East, G2 Entertainment, £7.99, obtainable from sales@manning-partnership.co.uk and local bookshops.

SUMMER 10

COMPANY PROFILE

PWC PREDICTS FUNDAMENTAL CHANGES IN BORROWING BEHAVIOURS With levels of unsecured borrowing falling by over £500 per household in 2010 and the borrowing habits of UK consumers going through significant changes, 2011 looks set to be a difficult year for credit card and other consumer finance providers. This is according to PwC’s annual report on the UK consumer credit industry: ‘Precious Plastic 2011. January is traditionally the time of year when people reflect on their financial situation and our research shows that consumer confidence is still weak. In fact, some 40% of respondents still expect their pay to be reduced or frozen in the coming year. Consequently, households are seeking to reduce the amount that they borrow. These worries are driving consumers back to ‘jam jarring’, whereby they shun large loans and open ended credit cards in favour of smaller, shorter term borrowing for a particular purchase, in an

effort to control their borrowing. Therefore it is not surprising that we have seen average unsecured credit (i.e. credit cards and personal loans) fall by some £500 over the last year to around £8,000 per household – a trend we predict will continue over the next few years with a further fall of up to £300 in 2011. However, we believe that interest rates on borrowing could rise by 2% to 3% by 2015, meaning that on average, UK households would need to find an extra £1,800 a year for interest payments alone – a significant proportion of their disposable income.” The UK’s cooling passion for plastic continued as the number of credit cards in circulation fell by some 1.5 million compared to 2009, to the lowest levels since 2003.By contrast, in 2010, debit cards have continued to gain in popularity, overtaking

cash for the first time. Demand and supply have both played a part in the decline in the use of credit cards. Consumers are focused on paying off their debts and are planning to save more, while lenders remain selective in terms of who they lend to.

For further information, please contact Bill MacLeod, Partner at PwC in Newcastle on bill.macleod@uk.pwc.com or 0191 269 4037

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BUSINESS QUARTER |WINTER 11

BIT OF A CHAT

with Frank Tock >> Tan-ning the old chestnut When the sociologists and politicians of certain hue push at me the theory about deprived childhood signalling “once a loser, always a loser”, I’ll tell them in future about Tan Le. She’s a star performer that Herb Kim expects to as a keynote speaker at the Codeworks Thinking Digital Conference at Gateshead on May 24 to 26. She’s also a shining example of how a poor start in life need not necessarily be a barrier to success. Tan is a former Young Australian of the Year and was voted one of Australia’s 30 Most Successful Women Under 30 in the same year. In 2000 she co-founded a wireless technology firm whose activities extended to Asia and Europe. She was part of negotiating a successful merger in 2003. Then she co-founded Emotiv, a neuroengineering company that has developed a technology for digital media taking inputs directly from the brain.

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Applications could range from gaming to interactive television, everyday computer interactions, hands-free control systems, smart adaptive environments, art, accessibility design, market research, psychology, medicine, robotics, automotive, transport safety, defense and security – all these things. Developers and researchers in more than 70 countries are already working with the technology. So what, you say? So this... Tan has had no silver spoon to sup from. She was a refugee when she arrived in Australia from Vietnam at the age of four. But she got into university at 16 and 10 years ago she was admitted as a barrister and solicitor. All this was besides working to better prospects for her fellow Vietnamese refugees. She proves for me that no matter how unpromising your start in life, you can make things change.

>> Not so easy The Government’s aim of displaced public sector employees finding work in the private sector may not be so easily achieved. Mark Simpson, director at Nigel Wright Recruitment, says: “I think people coming out of the public sector will find it very hard. As the private sector has greater expectations of its employees than before, anyone it takes on must be able to demonstrate they can add value. Public sector, meanwhile, is being told it costs too much and doesn’t necessarily add value for its cost. “There are challenges there for how we deal with that, even as a region. But,” he adds more hopefully, “a year on, if the economy continues to grow, people have short memories and will start to slacken off expectations.”

>> Money raisers

Tan Le: No silver spoon

BUSINESS QUARTER | WINTER 11

Space pressures preclude BQ from running much about business’s charity bashes, commendable though they are. However, I do wonder if the £35,000 raised in one night by the Entrepreneurs’ Forum is a record for the region. The money is going to Teenage Cancer Trust, which seeks to improve the lives of

Having a ball: DJ Mike Read with the Acoustic Beatles young sufferers. A ball at the Hilton Hotel, Gateshead, was hosted by DJ and former Radio One veteran Mike Read, who obviously brought out the good side of 300 of the region’s business folk and their guests. Incidentally, it brings the total raised through the Forum over the last seven years to £500,000. The £35,000 sum has been added to £50,000 raised by some Forum members and associates whose 2010 was highlighted by a trek to Everest Base Camp. The endeavours have taken the trust well towards £200,000 needed for a new eight-bed unit at the Freeman Hospital in Newcastle.

>> A tighter rein I think it encouraging in these difficult trading times that tendencies to sue in hope of bolstering the firm’s accounts appear to be fading. It was for years particularly common in construction. But that industry increasingly has recognised that teamwork and consultation on a job from the start makes sense. Helen Ager, managing partner of Crutes Law Firm in Newcastle, tells me: “We have talked a lot about this subject internally. “While our commercial litigation is very busy we’ve not found a big increase on that score. Perhaps people are just being more careful. They won’t throw money after speculative legislation. If they’ve reason to feel confident, they’re going after it as much as they ever did. But we find no influx of exaggerated or silly claims going on any more. It’s more a very cautious approach.” However there is, she adds, the usual steady flow of people falling out with each other. Let’s have a drink and talk about it.

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Got the measure of your employee engagement?

J866 NCA EVH Xmas 2011 ad (175x120).indd 1

20/01/2011 11:29

Find out for FREE by completing Newcastle Business School’s anonymous online survey. Employees who are fully engaged with their work perform 20%* more effectively, are 59%** more innovative, and take 57%*** less sick leave than those who are not fully engaged. * Corporate Leadership Council, ** Krueger & Killham, *** Gallup

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For more information to see how this survey can really benefit your organisation, please contact: Dr. Johan Coetsee on 0191 227 3843 or johan.coetsee@northumbria.ac.uk Dr. Michael Green on 0191 227 3019 or michael.j.green@northumbria.ac.uk

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EVENTS

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BQ’s business events diary gives you lots of time to forward plan. If you wish to add your event to the list send it to: editor@bq-magazine.co.uk. The diary is updated online daily at www.nebusinessguide.co.uk

FEBRUARY

8,9 Business Exchange North East Trade Fair, The Sage, Gateshead (9am). Contact: tel 0191 241 4523, info@business-exchange.org.uk, www.business-exchange.org.uk

11 Alternative Energy Solutions: The Way Forward, free seminar and working lunch at Burnetts Solicitors, Newcastle (12.30). Contact: tel 01228 55 2222, enquiries@ukti.rito.co.uk

9 ICAEW BASE Northern region heat, Northumberland University. BASE is the national business game for sixth formers developing business and finance skills, and introducing career opportunities. www.icaew.com/base

11 Newcastle Science City’s First Friday North East, entrepreneurial networking, Central Bean, Sanderson Arcade, Morpeth (8.30am). www.newcastlesciencecity.com

15 Teesside Society of Chartered Accountants, Tees Valley General Practitioner Group HMRC, Riverside Stadium Middlesbrough (12.45pm). Contact: Rob Tindle, tel 01642 878555

11 Alternative Energy Solutions: The Way Forward, Burnetts Solicitors law at lunchtime event, 12 Lansdowne Terrace, Newcastle (12.30pm). www.burnetts.co.uk 15 Distinctive Delivery, Amazing Service, Amazing Results, Service Network event, venue tbc (9am). Alexis Towell tel 0191 244 4031. Register: www.service-network.co.uk 15 Managing Talent, Practicalities of Productivity, legal update, Service Network and Samuel Phillips event, Assembly Rooms, Newcastle (noon). Contact: tel 0191 244 4031, events@service-network.co.uk 15 Teesside Society of Chartered Accountants, Tees Valley General Practitioners’ Group training update, Riverside Stadium, Middlesbrough (12.45pm). Contact: Rob Tindle, tel 01642 878555 15 to 17 Disney Institute Training Event, Business Link opportunity to learn more about branding from a world leading name, Hilton Gateshead (9am) daily. Contact: tel 0191 241 4523, disney@business-seminars.org.uk, www.business-seminars.org.uk 16 Opportunities and Developments in the North East, Nepic pharma and biotechnology sector, Stadium of Light, Sunderland. Contact:lynne.angiers@nepic.co.uk. Tel: 01642 442 560

15, 16 Design Means Business, Design Council and RTC North event with speakers from Dyson, Procter and Gamble, Nissan and games company Hasbro, The Sage, Gateshead. www.designnetworknorth.org, tel 0191 516 4400 16, 17 Building Business Success Stories, North East Science City’s two-day workshop, Time Central, Newcastle. Contact: Simon Green 0191 211 3015. simon.green@newcastlesciencecity.com. www.newcastlesciencecity.com 17 Winning New Business through Collaborative Working, Service etwork event, venue tbc (9am). Alexis Towell tel 0191 244 4031. Register: www.services-network.co.uk 22 Middlesbrough Council presentation, Selling to the NHS Website, Middlesbrough Football Club (9.45am). www.procurementevents.com/s2nhs.html 24,25 Northern Defence Industries Conference and Exhibition, Royal Armouries, Leeds. Contact: tel 0191 255 1720, kirsten.meaney@ndi.org.uk

16 Robinson Laidler Free Tax Surgery, Fernwood House, Newcastle (12.30pm). Contact: Susan Bowen, tel 0191 2818191, sbowen@robson-laidler.co.uk

28 to Apr 1 UKTI Brazil Markets Visit. Contact: tel 0845 0505 054, enquiries@ukti.rito.co.uk

17 Can’t Pay Won’t Pay, Service Network and Hay and Kilner event focused on debtors, Centre for Life, Newcastle (8.30am). Contact: tel 0191 244 4031, events@service-network.co.uk

APRIL

17 Pensions Unplugged, Ellis Bates offices, Shakespeare House, Newcastle (5pm). Contact: yvonne kellett@ellisbalesgroup.com 19 Business Link event, Start Your Business, Thistle Hotel, Middlesbrough (10am). Contact: tel 0191 281 5777, businesslink@btob.co.uk, www.sybevents.co.uk. 22 Advanced Export Seminar for firms already trading overseas, UKTI event. Longhirst Hall, Morpeth. Contact: enquiries@ukti.rito.co.uk, tel 0845 0505 054 23 Winning New Business through E-Marketing, Service Network event, venue tbc (9am). Alexis Towell tel 0191 244 4031. Register: www.service-network.co.uk 23 Middlesbrough Council presentation, Selling to Defence, Middlesbrough Football Club (9am), www.procurementevents.com/s2d.html 24 Advanced Export Seminar for firms already trading overseas, UKTI event. Marriot Hotel, Gosforth Park. Contact: enquiries@ukti.rito.co.uk, tel 0845 0505 054

MARCH 2 North East Expo, Newcastle Racecourse. Contact: expo2011@backconsulting.co.uk. Tracy Skinner: 0191 236 2020, 07811 379 770, tskinner@newcastle-racecourse.co.uk 3 Advanced Export Seminar for firms already trading overseas, UKTI event. Middlesbrough Teaching and Learning Centre. Contact: enquiries@ukti.rito.co.uk, tel 0845 0505 054

7 CECA (NE) annual general meeting and Trainee of the Year presentation, Ramside Hall Hotel, Durham (6pm). Contact: Vicki Munro tel 0191228 0900. kellceca@aol.com 16 onwards Wallace and Gromit Present a World of Cracking Ideas, an Intellectual Property Office sponsored exhibition, Life Science Centre, Newcastle (10am-3.30pm). Contact: Vicky Pepys tel 0191243 8209, Vicky.pepys@life.org.uk. www.crackingideas.com, www.life.org.uk

MAY 5 NECC Durham & Wear Annual Dinner, Stadium of Light, Sunderland (6.30pm). Contact: tel 0300 303 6322, www.necc.co.uk 24 to 26 Thinking Digital 2011 Conference, The Sage, Gateshead. www.thinkingdigital.co.uk/2011 Please check with the contacts beforehand that arrangements have not changed. Events organisers are also asked to notify us at the above e-mail address of any changes or cancellations as soon as they know of them.

KEY:

3 Tyne & Wear Society of Chartered Accountants Chairman’s Supper, Newcastle Racecourse (6.45pm). Contact: tel 0191 300 0532 email Marie.Rice@icaew.com 5 Start Your Business, a Business Link Event, Stadium of Light, Sunderland (10am). Contact: tel 0191 281 5777, businesslink@btob.co.uk, www.sybevents.co.uk

BUSINESS QUARTER | WINTER 11

15 Advanced Export Seminar for firms already trading overseas, UKTI event. Durham County Cricket Club. Contact: enquiries@ukti.rito.co.uk, tel 0845 0505 054

Acas: Advisory Conciliation and Arbitration Service, CECA (NE): Civil Engineering Contractors Association (North-East), CIM: Chartered Institute of Marketing, HMRC: Her Majesty’s Revenue and Customs, ICE (NE): Institution of Civil Engineers North East, ICAEW (NR): Institute of Chartered Accountants in England and Wales, North Region, NECC: North-East Chamber of Commerce, NSCA: Northern Society of Chartered Accountants, FSB: Federation of Small Business, Tbc: to be confirmed.

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Install a charge post and join the North East electric vehicle revolution

Electric vehicles are a major part of the transport of the future and are set to revolutionise our lives. With tens of thousands of sales predicted over the next few years, these green vehicles are not only good for the environment but they’re incredibly cost effective to run too. Of course, putting the infrastructure in place to ensure that drivers are never too far away from a charging post is essential – that’s why the North East is leading the way. These posts are popping up everywhere and businesses are seeing the benefits of providing charging access for themselves, their employees, customers or clients. And with 50% funding available towards every standard post fitted in North East England there’s never been a better time to lead the charge.

Up to 1,000 electric vehicle charging points are being installed in North East England. Find out how you can play your part at www.leadthecharge.org.uk Project funded by the Office for Low Emission Vehicles (OLEV), One North East and North East regional parties.

14563 CR CYC B&Q Mag FP 260x205.indd 1

*Cost is up to £2,500 instead of £5,000

25/01/2011 17:39