BQ North East Issue 14

www.bq-magazine.co.uk

ISSUE FOURTEEN: SUMMER 2011

sunrise in sunderland The Live Debate argues the case for what the region’s

biggest city can offer – and game plans fill the schedule

hi dubai – hello ny?

Emirates’ service to the Middle East has been extraordinarily successful, so would a direct link to the Big Apple succeed?

the train now taking off The bid to lure Hitachi to Newton Aycliffe was orchestrated

by a man with a vision – which started with a helicopter ride

coming alive after five Newcastle’s take on a 40-year-old city centre improvement scheme has surpassed all expectation. Beach anyone?

going boom

Hydrogen holds the key to future energy provision – and the enterprising David Bowles is at the heart of its development BUSINESS NEWS: COMMERCE: FASHION: INTERVIEWS: MOTORS: EVENTS

NORTH EAST EDITION

Business Quarter Magazine

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WELCOME

BUSINESS QUARTER: SUMMER 11: ISSUE FOURTEEN One year into the new Government’s policies we find that while the economy isn’t entirely stormcloud (as some critics predicted), and several rays of sunlight are brightening the North East, some discomfiting consequences are also emerging. You’ll see what we mean reading this issue’s BQ Live Debate. There, people who care passionately about Sunderland discuss what’s needed to nurture private sector growth, and their disclosures and discussion have a bearing upon all of our region.

While we’re losing our regional development agency to two local enterprise councils (with lots of acumen and will, but no money) that doesn’t mean we need become a region divided. Two articles we have for you illustrate that. While Sunderland, among other things, wants to improve its retail sector, Newcastle – through the agency running its business development district – has found how to liven the city at night and bring staggering amounts of new business in.

Sunderland, on the other hand, is showing how millions can also be raised by organising more mega-entertainment in cities the big concert promoters didn’t want to know. As Newcastle is considering something similar, the region’s two biggest cities could surely benefit from sharing each other’s experiences, ensuring as they do that events don’t clash.

Stories to cheer us include that of the innovative team at Sedgefield who may be onto a winner with their magic box. And did you know what stroke of inspiration led to a new train assembly industry taking off, literally, at Newton Aycliffe?

With Nissan’s impending electric car industry a further uplift for the North East economy, we talk to the region’s biggest family business about its involvement. And, for businesses able to benefit through exporting, our good news is that the region’s connections abroad are about to get even better. Our tourist industry, though hit by budget cuts, will at

least have Sarah Stewart, chief executive of Newcastle Gateshead Initiative, looking after the region’s interests on the revamped national tourist board VisitEngland. Join her here.

We read and hear a lot about the growing flow of young business talent via universities and apprenticeships. But another rich supply source exists from another invaluable quarter.

Our pages hopefully help if you need access to finance, or if you’ve been a flood victim. BQ2 covers capital matters, while Jonathan Willett, a Teesside insurance broker who has suffered the flooding nightmare himself, says costly insurance premiums quoted can be shaved.

All this, and more, for your perusal.

Finally, a bit of good news about ourselves.

As BQ and its parent company Room501 Publishing advance with the enthusiastic support of readers and advertisers, we can announce two new appointments. Mark Anderson has been promoted from business development manager to sales director, while Bryan Hoare – previously sales and marketing director – has moved to marketing and communications director. These changes will reflect exciting additional directions that Room501 Publishing and all its publications are taking to the benefit of their readers.

Enjoy this issue.

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 Mark Anderson Director e: mark@room501.co.uk EDITORIAL Brian Nicholls Editor e: b.g.nicholls@btinternet.com Alastair Gilmour e: alastair.gilmour@hotmail.com DESIGN & PRODUCTION room501 e: studio@room501.co.uk PHOTOGRAPHY KG Photography e: info@kgphotography.co.uk NR Photography e: info@nrphotography.co.uk Peter Skelton Photography e: peterpsp@photo-psp.co.uk ADVERTISING If you wish to advertise with us please contact our sales team on 0191 537 5720, or email sales@room501.co.uk room501 Publishing Publishing House, 16 Pickersgill Court, Quay West Business Park, Sunderland SR5 2AQ www.room501.co.uk

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, July 2011.

NORTH EAST EDITION

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BQ Magazine is published quarterly by room501 Ltd.

BUSINESS QUARTER | SUMMER 11

CONTE BUSINESS QUARTER: SUMMER 11 RAIL LIFT-OFF

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52 FAMILY FIRM

Features

Benfield turns over a new leaf in a highly-competitive marketplace

56 HARD KNOCKS Cheryl Cole’s favourite charity is producing tomorrow’s entrepreneurs

26 HYDROGEN BOOM The energy to fuel cars and kitchens is being developed right here

32 HI DUBAI, HELLO NY Can Emirates’ highly-succesful route to the east be repeated the other way?

42 THE LIVE DEBATE Sunderland’s leaders put the city’s case for regeneration on the table

BUSINESS QUARTER | SUMMER 11

62 RAIL LIFT-OFF Persuading Hitachi to build trains started with a helicopter ride over the region

92 PREMIUM BONDS Jonathan Willett and his sister Emma are getting it right in insurance

96 NE1 FOR EXPANSION? Business improvement in Newcastle has gone further and faster than expected

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NE1 CAN DO IT

96

TENTS NORTH EAST EDITION

68 BUSINESS LUNCH

SARAH STEWART TALKS INITIATIVE

Sarah Stewart discusses the future of NewcastleGateshead Initiative

74 WINE Two Argentinian wines are the choice of Keith Proudfoot – was he impressed?

Regulars 6

ON THE RECORD People making waves – and how

10 NEWS Who’s doing what, when and where

24 AS I SEE IT Paul Asensio evaluates social networking

36 COMMERCIAL PROPERTY Building on the region’s infrastructure

76 MOTORS Efficiency and the Mercedes C250 CDI

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79 FASHION Sweeney shod in ‘proper’ footwear that’s quirky – with a twist

88 EQUIPMENT

PROUDFOOT ON WINE

Rolls-Royce gets an electric shock

100 IN ANOTHER LIFE The Ironman runs. And swims. And cycles. Then he goes to work

104 BIT OF A CHAT Gossip from backroom boy Frank Tock

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74 BUSINESS QUARTER | SUMMER 11

ON THE RECORD

SUMMER 11

The business brakes are applied, partnership leaders are named, Nissan is number one, a motor firm takes another turn, enterprising females are honoured – and their champion seeks new challenges >> Ground upwards RTC North, which has already done much of the groundwork, will now run the Design Network North (DNN) project improving links between industry and the design sector, and placing design at the heart of the regional economy.

From next January the network’s new home will be the purpose-built Northern Design Centre in the heart of Gateshead’s Baltic Business Quarter.

DNN has already boosted the regional economy by an estimated £7m.

>> £100m splash for the paint industry AkzoNobel the global leader in paints, coatings and speciality chemicals – think Dulux, Cuprinol, Hammerite and Polycell – is renewing its commitment to the North East with a £100m spend on a new world-class, high-tech manufacturing facility.

The Dutch multinational’s present site at Prudhoe will close, as too manufacturing at Slough, though it will remain UK headquarters. The new operation, tripling its North East manufacturing capability, should be running by 2014.

Paul Woolston, chairman of the North East Local Enterprise Partnership, says: “This shows how the North East can attract hi-tech manufacturing investment into the UK.” The new site will be within 25 miles of Prudhoe. The company’s Felling plant benefited from a £9m upgrade in 2009.

AkzoNobel employs 4,050 people in the UK including 89 at Prudhoe.

>> Branch of the year PwC in Newcastle was named branch of the year at the the North East Accountancy Awards.

BUSINESS QUARTER | SUMMER 11

>> Business gets still slower There has been a further slowing of business activity growth in the North East, June data from Lloyds TSB suggests. Although new orders rose at a solid and accelerated pace, output rose only slightly, leading to an expansion of outstanding business, the survey found. Price pressures, meanwhile, continued to moderate but remained strong in the context of the series history.

Manufacturers showed a firmer trend in output than service providers.

Martyn Kendrick, area director for Lloyds TSB Commercial in the North East, concludes: “The North East under-performed the UK as a whole in June for the first time in seven months. Weaker output trends were registered across both manufacturing and services.

“But new order growth in the region was above UK average.”

PMI Composite Output Index, SA (50 = no change) 65 60 55 50 45 40

All UK

35 30

>> Bean counter bashes bankers The new president of the Northern Society of Chartered Accountants has lambasted banks for failing to back smaller businesses.

David Swallow, who runs his own chartered accountancy in Stokesley, says the North East needs “meaningful” support from the banks to have a vibrant SME sector.

“Their failure to meet their initial lending targets in Project Merlin comes as no surprise,” he says.

An initial quarterly survey of Merlin showed banks met their overall business lending

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target, but fell short towards small firms by around £2bn. Yet Britain’s top five major banks – HSBC, Santander, Barclays, Lloyds and Royal Bank of Scotland – have agreed under Merlin to lend around £190bn this year, with at least £76bn to smaller firms.

The Government has threatened a tax sanction if failure continues.

Lloyds Banking Group has committed to review customer appeals on 90% of lending decisions within 15 working days – faster than the industry commitment of 30 calendar days.

(Pauline Osborne, North East regional chairman of the Federation of Small Businesses, says a survey of members showed only 16% had sought bank credit – of whom 44% had been refused.)

David Swallow is likely to continue pressing on SME’s behalf.

Meanwhile, two appointments have been announced. Craig McBride, a partner at Gilchrist Tash in Middlesbrough, now chairs Teesside Society of Chartered Accountants.

Paula Park, an international accountant with Sage plc, now chairs Tyne & Wear Society of Chartered Accountants.

>> O, look here...

Five years into business, the Newcastle PR agency O Communications is changing its name to OPR. It has won more than 20 awards since start-up.

>> Drive for hi-sci talent Three leaders in the North East science and technology arena have jointly launched a support system to keep top talent and attract fresh innovators to the region.

NETPark, the Centre for Process Innovation (CPI) and Durham University are developing the Business Innovation Gateway, a portal offering information and advice, access to finance, development support and access to premises for aspiring firms.

SUMMER 11

>> Tax breaks sacrificed One in 10 small business owners are not filing tax returns or making tax payments on time, according to a survey of 500 SMEs by Clydesdale and Yorkshire Banks. They say 19% had also missed out on potentially valuable tax breaks and grants.

>> Hello, partner Activtelecom of Newcastle has been acclaimed for its customer service and named a Vodafone Gold Partner for Customer Retention.

>> Golden counters Tait Walker, which operates from Newcastle, Morpeth and Stockton, is the only accountancy firm in mainland Britain to have won gold standard with Investors in People.

>> North East Local Enterprise Partnership A Local Enterprise Partnership has been chosen and approved to represent the North East region, apart from Teesside.

It comprises: Chairman: Paul Woolston, senior partner, PwC LLP Private sector: Dr Arnab Basu, chief executive, Kromek, Sedgefield; Michael Bellamy,general manager, PII, Cramlington; Fiona Cruickshank, director, SCM Pharma, Prudhoe; Andrew Hodgson, chief executive, SMD, North Tyneside; David

ON THE RECORD

Land, operations director, Thyssenkrupp Tallent, Newton Aycliffe; Jeremy Middleton, Middleton Enterprises; Gill Southern, director, Wessington Cryogenics; Paul Varley, managing director, Carillion Energy Services Academia: Professor Chris Bink, vice-chancellor, Newcastle University; Angela O’Donoghue, principal, Sunderland College Public sector: Linda Arkley, elected mayor, North Tyneside; Cllr Nick Forbes, leader, Newcastle City Council; Cllr Simon Henig, leader, Durham County Council; Cllr Mick Henry, leader, Gateshead Council; Cllr Iain Malcolm, leader, South Tyneside Council; Cllr Jeff Reid, leader, Northumberland County Council; Cllr Paul Watson, leader, Sunderland City Council.

The partnership, covering seven local authority areas, joins the 27 partnerships announced since the Government’s Local Growth White Paper was published last October.

A partnership for Tees Valley area, Tees Valley Unlimited, was approved earlier this year. So two Local Enterprise Partnerships cover the North East, a region previously covered by regional development agency One North East alone.

>> Builders’ fines slashed A “top 10” legal case of 2010, which had 25 construction firms appealing against the Office of Fair Trading’s “bid-rigging” fines, has now received judgment from the Competition Appeal Tribunal (CAT) for almost all instances.

In one of the largest and longest OFT investigations, Watson Burton law firm acted for five of the 25 national firms appealing. Its lawyers represented 13 of the original 112 companies fined.

The tribunal cut one client’s fine by more than £1m. Most of the appellants were seeking lower penalties, claiming those imposed were disproportionate to the infringement. The appeal slashed the penalties by up to 94%.

Caroline Rye, regulatory solicitor at Watson Burton, says: “We believe the appeal tribunal has taken a more balanced and pragmatic approach.”

>> New role for Winter Ashley Winter has succeeded David Bowles as chairman of the enterprise agency Entrust. Winter, who formerly led the Patterson Motor Group, is also chief executive of the Retail Automotive Alliance and chairman of the Community Foundation Tyne and Wear and Northumberland.

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Caroline Rye: A more balanced outcome from the appeal tribunal

BUSINESS QUARTER | SUMMER 11

ON THE RECORD >> North East sets export pace Exports from the North East continue to grow, with the region showing the highest growth rate of all the English regions for 12 months to the end of March, according to HM Revenue & Customs.

>> Safe-TTE first The TTE Technical Training Group has retained the British Safety Council’s five star Health and Safety award for the second successive time. The Teesside-based body receives a mix of local learners and technicians from national and international employers.

>> Nissan tops the 200 Nissan is number one in The Journal list of North East Top 200 companies this year. Arriva is second and Go-Ahead third. The list is based on annual turnover.

>> Fawdington farewell Fawdington motor dealership has changed its name to Lloyd Newcastle. Dealer principal Keith Watson explains: “We decided after 12 years as part of the Lloyd Motor Group it was fitting to make a change.”

The Lloyd family launched the group 30 years ago with one dealership in Cockermouth. Now based in Carlisle, it is listed in the top 100 dealer groups by Automotive Management.

>> Firm almost doubles North East Company of the Year Nifco UK will raise its workforce by more than 100 to around 320 with its £8.3m move to bigger manufacturing premises in Stockton. It serves the automotives industry.

>> Help for SMEs Clydesdale and Yorkshire Bank have launched an online support hub with the Forum of Private Business. It offers specialist advice, help and resources. http://www.cbonline.co.uk/business/ under-1m/business-under-1m or http:// www.ybonline.co.uk/business/under-1m/ business-under-1m

BUSINESS QUARTER | SUMMER 11

SUMMER 11

>> Entrepreneurs excel The region’s entrepreneurs have honoured two women with widely different business interests.

Sara Davies has been designing, manufacturing and retailing tools and materials for crafters for six years, while Anne Preston has run her family haulage business, Preston of Potto, for five decades. Davies, founder of Crafter’s Companion, received the Emerging Talent of the Year award presented by the Entrepreneurs’ Forum.

Preston, who chairs Prestons, received a Lifetime Achievement award. Now in her seventies, Anne is still brimful of ideas and enthusiasm. She was the first woman chairman of the Road Haulage Association and has campaigned particularly against fuel price rises.

Also recognised at the forum’s annual business conference dinner and awards was Phil Cronin, chief executive of the Sunderland online bingo brand Tombola. He was proclaimed Entrepreneur of the Year.

The evening was stunning in more ways than one, since a rumour circulating among guests that Carole Beverley had resigned as chief executive was later confirmed.

She had held the post since the launch of the North East organisation in 2003. Shorn from next year of a £300,000 One North East grant, the forum and its nine staff inevitably face change. But chairman Tom Maxfield, praising her service, denied the funding cut had a bearing.

Beverley, previously commercial director of Newcastle United and senior sports marketing manager for Adidas, says she wants to “explore new opportunities”.

>> Young firms backed Business leader Sir Ian Wrigglesworth is backing a scheme to match experience with enthusiasm in North East companies.

Sir Ian, deputy chairman of the Government’s Regional Growth Fund Advisory Panel, firmly favours a recently-launched Experience Bank aimed at partnering young and growing companies with men and women of sound experience in the same sector – or with

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Sara Davies: An emerging talent

Well done: Campaigner Anne Preston receives her lifetime award from chairman Tom Maxfield

Carole Beverley: Off exploring

specific specialist skills. It is an offshoot of the Routes to Investment initiative developed by North East Access to Finance, which helps businesses access funding.

>> DTW enters Top 50 DTW public relations and marketing agency at Guisborough is the only North East firm on PR Week’s list of Top 50 digital agencies in the UK. The list is based on fee income.

SUMMER 11

COMPANY PROFILE

Neil Dwyer, head of employment at Hay & Kilner, is helping businesses take action to comply with the Bribery Act.

PROTECT YOUR BUSINESS FROM PROSECUTION

T

HE Bribery Act came into force in July.

Many organisations have already expressed the view that, even before the Act, bribery would not be tolerated from a “rogue” employee or agent, because it damages the goodwill of a commercial business, particularly if their operation is global.

Businesses need to take steps to ensure that employees are made aware of their anticorruption ethos. Relevant employees should be involved in a risk assessment to identify where a risk of bribery may arise and notified of an appropriate policy and procedure that will enable the employer, under threat of prosecution, to defend its position.

Whose unauthorised bribery could a business be liable for?

An employer is liable for the actions of “associated persons”. That includes all employees and any party who is performing services for the employer or on its behalf such as contractors or agents.

Liability is possible if a bribe is paid with the intention of obtaining or retaining business or a business advantage for the employer.

Are there any new criminal offences?

The Act creates new criminal offences of: • offering or receiving bribes; • bribery of foreign public officials; and • failure to prevent a bribe being paid on behalf of a commercial organisation.

Hospitality - where should you draw the line?

The Act does not prohibit reasonable and proportionate hospitality. Bona fide hospitality and other business expenditure which promotes the image, products or services of a commercial organisation are recognised as established and

Hay & Kilner’s employment team: Sarah Hall, Neil Dwyer & Sarah Furness. important business activities. The legislation is not intended to criminalise such behaviour.

HAY & KILNER’S EMPLOYMENT TEAM OFFERS A FREE AUDIT AND GIVES ADVICE ON IMPLEMENTING THE CORRECT PROTECTIVE POLICIES How can an employer defend itself?

A full defence is available to employers if they have adequate procedures in place to prevent bribery. The Guidance focuses on six high-level principles and advocates a “risk-based proportionate and common-sense approach to the design of policies and procedures”. “The objective of the Act is not to bring the full force of the criminal law to bear upon well-run commercial organisations that experience an isolated incident of bribery on their behalf”. Neil Dwyer, employment law expert at Hay & Kilner Solicitors, advises employers to carry out the following tasks:

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• Carry out a risk assessment of all activities to identify where a risk of bribery may arise.

• Confirm top-level commitment to establishing a culture within which corruption is eliminated. A senior officer should be directly responsible for overseeing the anti-corruption programme.

• Carry out a due diligence assessment before any major business relationship or project.

• Implement clear policies and procedures to minimise the opportunity for corruption and to clarify the approach that those responsible should take when negotiating contracts. There should also be a clear policy on gifts and entertainment.

• Ensure effective implementation. The policy must be publicised to all employees and agents.

Financial controls should be put in place to minimise the risk of bribery.

• Monitor and review.

Businesses that follow the guidance should have nothing to fear.

Hay & Kilner’s employment team offers a free audit and gives advice on implementing the correct protective policies.

Please contact Neil Dwyer or Sarah Hall on 0191 232 8345 or email neil.dwyer@hay-kilner.co.uk or sarah.hall@hay-kilner.co.uk Visit www.hay-kilner.co.uk

BUSINESS QUARTER | SUMMER 11

NEWS

SUMMER 11

in association with

Construction deconstructs, schoolgirls show their acuman, there’s a coffee kick for North East companies, Roman heads home from China, change management gets a leader and strimmers cut it in awards >> Collapse of construction goes on

>> Waste deep in cash Award-winning J&B Recycling has won a £1.5m a year contract to collect household waste from all recycling banks across Teesside – at Hartlepool, Stockton, Darlington, Middlesbrough,Redcar and Cleveland.

Managing director Vikki Jackson-Smith says: “It’s the first time there have been standardised sites across the region. We are delighted.”

The company, which won both the overall and the environmental categories at this year’s Hartlepool Business Awards, employs 145 staff and achieves a turnover of £8.96m, recycling some 100,000 tonnes of waste a year.

Recycling first: Managing director Vikki Jackson-Smith at one of J&B’s new recycling sites in Hartlepool

>> In luck again A company two ex-Reyrolle employees set up on the strength of their pools win has invested more than £1m to expand with new machinery in a new 31,000sq ft site.

Tharsus, also with a £245,000 grant from One North East, and guidance from UNW corporate finance partner Neville Bearpark, secured a deal close to its existing Blyth site.

It already employs 100 staff between Blyth and its Hebburn headquarters and its third plant should be open later this year.

BUSINESS QUARTER | SUMMER 11

Managing director Brian Palmer says: “There is masses of room here now for future development.”

>> Hotel to re-open Fifty jobs will arise when the restored King’s Hotel at Darlington – formerly the King’s Head in Priestgate – reopens after a devastating blaze in 2008. Manager Michael Noble says former employees will have first chance of work. The full opening will be early next year, the Cairn hotel group says.

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Decimation of the North East construction industry continues with P Whelan Ltd now in administration.

The Newcastle firm, formed in 1972, traded as Whelan Construction, employed 53 staff and had a turnover of some £18m. All but four staff have been made redundant, says PwC, which is handling the administration.

Other firms in the region recently entered into administration include Barton Civil Engineering of Gateshead, property repair group ROK and the John Laing Partnership. Many more jobs are threatened says Douglas Kell, director of the Civil Engineering Contractors Association (North East).

Nick Reed, joint administrator for Whelan, painted the scene many contractors in the region share.

“Margins have been coming under significant pressure,” he says. “There has been less work and the company has been unable to replace work with new contracts at appropriate margins.”

The association says recovery hopes are dashed by a growing inflation burden. While labour costs remain relatively flat, inflation is rising – particularly for fuels – at around 10%, and metals by around 7%. It says that while this will continue, tender prices are still slipping with contractors unable to pass on rising costs to customers. This further squeezes margins.

Official statistics for the first quarter of 2011 showed orders down 23%. The orders for infrastructure are particularly hard hit – plunging by 48%.

>> Into the Orchard Newcastle-based Orchard Information Systems has acquired Applaud Web Solutions in a deal advised by law firm Muckle.

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Because one size doesn’t fit all.

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NEWS

SUMMER 11

in association with

>> Words old and new A 100-year-old North East printing firm has joined forces with an 18-month-old company to combine tradition with digital technology. Elanders has teamed up with award-winning Shout Digital in Newcastle. Elanders UK, of Silverlink, North Tyneside, was formerly Hindson Print and is now part of a global printing group.

>> Conservatory doors closed A North East company’s 137 years of trading has ended abruptly under ownership by a private equity firm called, ironically, Endless.

More than 200 jobs – plus many also sub-contracted – look to have gone through Amdega, the world’s oldest manufacturer of conservatories, being put into administration.

Customers over the years had included Sir Michael Caine, Barbra Streisand, rock stars Sting and Bryan Ferry and television presenter Ulrika Jonsson.

Endless, a turnaround specialist, took over the firm last August, saying it was excited by the long-term prospects.

The Faverdale, Darlington, company (turnover £15m-£20m) was represented in 15 countries and exported to the Far East, mainland Europe and the US. But KPMG says Amdega was victim to a domestic downturn. Sales fell by about a third year-on-year, and had been falling over a period of four years.

Amdega adds to a rising list of corporate

insolvencies reported during the last quarter.

Linda Farish, chairman of the North East arm of R3 and director of recovery and Insolvency at Newcastle-based accountants RMT, says: “The rise in corporate insolvencies in the North East may seem surprising, given the economy’s growth during the quarter.”

Endless teamed up with retail entrepreneur Anthony Solomon in acquiring TJ Hughes, which has three stores in the North East and was due to celebrate its centenary next year.

That too has gone into administration.

The rise in insolvencies may seem surprising given the economy’s growth

>> Sara’s set for change Sara Ridley (above) of business and IT consultancy Waterstons is spearheading the launch of a North East Change Management Institute, an independent professional association set up to encourage change management internationally.

She says: “We have had an overwhelmingly positive response to the concept of a change management network in the North East.”

She became involved with the organisation founded in Australia in 2004 when she attended the launch of the UK chapter in London earlier this year. Enquiries are invited.

BUSINESS QUARTER | SUMMER 11

>> Graham gets his man Lee Westwood (above), who finished third in the US Open in May, is the new attached tour professional at entrepreneur Graham Wylie’s Close House, the Northumberland course where Westwood performed an opening ceremony.

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NEWS

SUMMER 11

in association with

>> Three decades on Motor equipment supplier Gott Technical Services recently and unusually celebrated 31 years in business.

The Morpeth-based, second-generation family business was 30 years old last year but chose not to celebrate then because of the tough economic landscape many of its clients faced.

However, a 35% leap in sales last year has prompted it to move up a gear, celebrating with customers and making inroads into Cumbria and Scotland.

Magic number: Ian Gott and colleagues at Gott Technical Services celebrate 31 years in business

Out for gain: Left to right, Lynsey Roy, Central Newcastle High School business studies teacher; Alex Hutchinson, school head of sixth form; Hannah Wrightson, winner; Mel Newton, runner-up, and Martin Wardle of Robson Laidler LLP

>> Girls are moneymakers Girls in Newcastle and Darlington are excelling as aspiring financiers and entrepreneurs.

A group of sixth formers took on experts in a stock exchange challenge and came out on top in Newcastle. The girls, all from Central Newcastle High School were invited by accountants and business advisers Robson Laidler to take part in a fantasy shares competition. Each girl was given a fictional £100,000 to invest in shares from the FTSE 100 Index over six months.

Robson Laidler provided “weekly updates” and advice on how the girls could improve their performance. To add to the challenge, experts from Robson Laidler and staff from the school also entered.

The competitors’ overall conclusion was that although experience and knowledge is essential, a little luck helps, too. This especially rang true for the staff at Robson Laidler and Central High.

They did less well than many of the girls in the competition.

Hannah Wrightson, 17, came out top, increasing her original investment from £100,000 to £133,000. She won a week of work experience at Robson Laidler.

Seven girls from St Aidan’s Church of England Academy in Darlington have shown their enterprise side. They became the first winners of Teesside University’s Junior Blueprint award.

>> Pharma picks up

>> Companies combine Carrick Financial Management of Seaton Burn, Newcastle, has joined up with Embleys Estate Agents of Whitley Bay to extend its client base along the North East coast. Embleys launched in January and says it has had a strong start.

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The Norwegian firm Trygg Pharma is reopening the former facilities of Lundbeck Pharmaceuticals (Denmark) and creating work for 25 highly-qualified personnel at Seal Sands, Billingham.

It has paid about £14m for the site, which earlier won a global industry award for its advanced manufacturing. It closed in 2008, when Lundbeck reduced production from three sites in Europe to two.

Stan Higgins, chief executive of the pharma

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cluster, NEPIC, says: “It will be great for Teesside and the pharmaceutical sector to see another of our units operating again.”

>> Northumbrian push A local initiative is helping rural businesses of Northumberland. A Northumberland Business Exchange organised by Carol Lynn at Longhirst Hall, Morpeth, has given firms a chance to exhibit and network. info@sosvirtualpa.co.uk or phone 07772 082 533.

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>> Mowing down competition

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technical nature. One company already benefiting is Jaspers Corporate Catering Services. It recruited customer service representative Sam Fuller when her contract with Sunderland Software City was ending.

Sue Burrow, franchise owner for Jaspers North East, says: “Sam has the skills mix we need to help develop our business.”

Chris Craig, business adviser at the North East Business and Innovation Centre (BIC), is running the project for local government. www.ne-bic.co.uk

An international design award has gone to the European research and development centre of Stanley Black & Decker at Spennymoor, County Durham.

Design manager Mark Stratford and his team, with engineering and surfacing colleagues, impressed with a new range of 23 strimmers that cut through thick grass without stalling.

Catering for success: Sue Burrow from Jaspers North East; Chris Craig, BIC, and Sam Fuller, customer service representative for Jaspers

Sam has the skills mix we need to help develop our business >> Bricks and mortar

Class designers: Mark Stratford, foreground, with the team behind the winning strimmer range

>> Green line buses Stagecoach North East is bringing in a £7.2m fleet of 26 hybrid electric buses in Newcastle. Its investment in the low-carbon vehicles follows an award of £2.2m from the Government’s Green Bus Fund. The award is the largest made from the fund outside London.

>> Talent streams in Smaller businesses have a chance to grow under a scheme giving access to highly skilled and experienced individuals for work on specific issues.

The project, Developing SME Expertise in the North East (DSME), enables a firm to employ a suitable individual who is under threat of redundancy, or already redundant from another organisation, while receiving up to 50% of an agreed salary.

Individuals eligible are of middle to senior management and of a professional or

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Award-winning Ryder Architecture has joined Northumbria University in launching BIM Academy to support the construction industry in the uptake of BIM (building information modelling).

BIM is seen at government level as having the greatest potential to transform the habits – and eventually the structure – of the industry. It aims to combine the experience and innovation in industry with the research and education capabilities of the university.

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>> Beers from home Expat Northumbrians are buying beer from home with online orders from the USA, Switzerland, Sweden and Austria.

They are getting it from Northumbrian Gifts, which sells packaged collections of various North East bottled brands. The firm has recently tripled its workspace and added three staff to 10 existing in a move to Ashington premises.

Geoff Hodgson, chairman of the North East England Tourism Advisory Service, says it’s a regional success story. Customers in the UK include Fenwick of Newcastle, English Heritage and National Trust properties.

The new premises include a shop where the public can join tasting events and compile their own gift packages. Stephen Wanless and his wife Katrina started the business in 2004. www.northumbriangifts.co.uk

Blooming business: Eight new starters at an award-winning garden centre

>> Cowell’s blooming Cowell’s family-run Garden Centre near Newcastle Airport has added eight more to the staff after winning the UK Garden Centre of the Year 2011 Award by the Garden Centre Association (GCA) and the Ruxley Rose Award for best plant area in the UK.

>> Spreading north A Leeds firm of plant hire equipment specialists, Chippindale Plant, has made its first move beyond Yorkshire, acquiring a fleet and a £1.65m depot to cover the North East from Scotswood, Newcastle.

First in line: Alex Dawson launches a new industry

>> New industry in the wind TAG Energy Solutions is now operating its new £20m offshore wind turbine tubular production facility at Haverton Hill, Billingham. With its £8m worth of equipment it will turn out large diameter cans for offshore windmill foundations there.

Chief executive Alex Dawson says that with a capability to produce 100,000 tonnes of tubulars a year the focus will be on the readiness for the Round 3

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offshore wind developments and current European opportunities.

The facility is a UK first and the workforce will vary between 100 and 400 depending on orders. The firm was established in 2006 with an investment of more than £12m to date.

The North East subsea sector expects a 29% increase in turnover over the next two years, according to Subsea North East. The region’s sector comprises around 50 supply chain companies, turning over £1bn a year and supporting more than 10,000 jobs.

Nortech Solutions, an engineering design and project management firm working internationally, has set up a North East operation at Wynyard Business Park in Tees Valley.

>> Eco-expansion Darlington and Newcastle renewable energy firm Eco Environments plans to open across the UK in the next 12 months after raising turnover last year by 636% to £1.4m. Already active in the North of England, North Wales and the Midlands, it plans to launch in the South East, East Anglia and the South West too.

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>> Egger cleans up Egger UK, the chipboard manufacturer often recognised by its pall over Hexham, has received an international award for its work reducing the environmental impact of its activities in future.

The company’s ISO 14001 certification follows a £16m investment in Europe’s most advanced emissions-control equipment and advanced wood-recycling machinery – a new biomass boiler powered by manufacturing residues – that lowers its use of fossil fuels.

Matthias Veile, the firm’s production and technical director at Egger, says: “Investing in recycling is not only environmentally-friendly but also helps to safeguard our supply of raw materials under threat from government subsidies that encourage electricity generators to burn the UK’s virgin wood supplies in biomass power stations.”

>> Apprentices’ sorcerer The Metrocentre’s general manager Tim Lamb, 49, is now also an ambassador for the North East Apprenticeship Company, working his business magic to promote the benefits of apprenticeships to businesses, employers’ and youth groups, school children and students.

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COMPANY PROFILE

ACTIVTELECOM CELEBRATES YEAR’S ACHIEVEMENTS

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EWCASTLE- based telecoms provider for the business market, Activtelecom, is celebrating its first year in new premises and looking towards a bright future.

Previously based in Cramlington, Activtelecom last year made the move to Balliol Business Park in pursuit of space to expand. During that time, the company’s workforce has increased by 25% to accommodate for new account wins and the business’s continued growth.

Established in 2002, Activtelecom provides expert impartial advice on all aspects of a company’s communications needs, as well as providing cost-effective solutions to meet business requirements.

The company has enjoyed several successes over

(left to right): Duncan Edward, Sales Director; Ian Gillespie, Chairman; Michael Fitzpatrick, Managing director the past twelve months. Most recently, Activtelecom was named as Vodafone’s Partner of the Year for Customer Retention for its industryleading rate of 95%, as well as being granted Vodafone Gold Partner status. This recognised the high level of service and accreditation that

Activtelecom has achieved, as well as allowing it to offer exclusive Vodafone services.

Managing director of Activtelecom, Michael Fitzpatrick, said: “We have had a very successful year and being able to expand our workforce by 25% is a huge achievement. We work with businesses to advise them on the best use of communications technology and save them money – a service that has been extremely popular in the current climate.

We are very excited for what the future has to offer.”

Tel: 0191 244 9400 www.activtelecom.co.uk

The CompleTe Business experienCe As a global leader of management education, research and knowledge transfer, Durham Business School makes an impact by developing business leaders and creating and disseminating business knowledge. Collaboration with local, national and international industry is crucial to achieving our mission.

Find out how you and your business could benefit from the knowledge and expertise within the School through getting involved in the following initiatives: • Business Placements • Careers and Recruitment • Academic Consultancy • MBA Consultancy Projects

• Programmes and Executive Education • Knowledge Transfer Partnerships • Research Collaboration

www.durham.ac.uk/dbs/bqcorp

Makers of business leaders

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>> Coffee on the move

Roll on: Brian Smith of Stadium Packing and Mario Croce of Coffee Latino with a mobile coffee trike bound for Dublin

Dealers in Australia, Iceland, Germany, the US and Dubai are all getting a flavour of coffee from the North East.

Coffee Latino, based at High Spen, converts vans and trikes into mobile coffee businesses which are now winning business in country after country.

Stadium Packing Services of Swalwell packs the vehicles safely for transporting.

Coffee Latino’s owner Barbara Croce says: “The vans and trikes are robust but have fairly delicate coffee machines fitted, and the trikes have solar panels.”

Husband Mario is a director of the firm, which has also received interest from Debenhams and Costa Coffee.

Stadium Packing has also worked on a major contract for a new £16bn oil and gas field at Jubail in Saudi Arabia.

Baric Systems built a large fluid handling system at Blyth which was then encased in a specially-made container by Stadium in Swalwell for despatch to the refinery due to operate from 2013.

>> Different, it is

>> Group targets zero energy

Marketing agency Different lives up to its name. Its award-winning digital team has broken away to form an independent firm, Status Marketing Ltd. Status, like Different based in Newcastle, is owned and managed by four ex-Different senior staff – Nick Salloway, former head of Different Digital, plus Stuart Marlow, Neil Lewis and Graeme Wilkinson. The remaining six of Different’s digital team have also joined.

Jon Watson of Jon Watson Consulting. Robert Langley the Newcastle solicitors are backing the venture and will be non-executive directors. Early clients include Glasgow Caledonian University, the Outdoor Industries Association and Future Transport Systems.

Two Northumbrian firms, Wansbeck Life Ltd and Northern Coalfields Property Co Ltd, have restructured and rebranded to develop housing with a low or zero energy concept.

WLL runs an enterprise centre part-funded by the European Community, also workshop incubation units and other office/workshops in Ashington.

NCPC, which celebrates its 25th anniversary this year, already owns and manages 678 houses, many acquired from British Coal and mostly in South East Northumberland. They have been upgraded to official “decent homes” standard.

Now the group which already installs solar panels, air-source heat pumps and hybrid boilers in its properties, wants to add sustainable value further, perhaps in partnership with other organisations.

WLL, which owns NCPC, is itself owned by Northumberland Council. WLL and NCPC will be renamed Arch (Commercial Enterprise) Ltd and Arch (Housing) Ltd respectively. Their

>> New centre for Onyx Technology provider Onyx Group has acquired an additional data centre between Leeds and Sheffield.

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subsidiaries and facilities will also include Arch in their names – standing for Ashington Regeneration Construction and Housing.

The holding company will be Arch (Corporate Holdings) Ltd. Victor Adams, group chief executive, says: “We hope to harness ideas and energies of local entrepreneurs to the area’s benefit, and to stimulate work for local tradespeople.”

>> Seafood supreme A North East supplier of seafood has been named among the top 100 food and drink manufacturers in the UK and Ireland. Cumbrian Seafoods, which operates at Seaham and Amble, is now listed alongside global names in the new Top 100 food and drink manufacturers in the UK and Ireland. The ratings assessed

by Food and Drink Business Europe include global giants like Unilever, Cadbury, Heinz and Coca-Cola.

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>> Into the Top 25 Dickinson Dees has been recognised as one of the UK’s Top 25 law firms for private client work, following research by Private Client Practitioner, an industry forum for private client professionals.

Instructor Donna Deans with some of the new equipment

>> £30m boost for Blyth Shepherd Construction is working on a £30m contract to further develop the National Renewable Energy Centre (Narec) at Blyth in Northumberland.

>> Rackley knows the feeling Former manager Jason Rackley – made redundant from a security firm last year and unable to find an alternative job – has now launched an online firm to help others like him who have been trying to escape the dole queue.

Rackley, from Stockton, says Compareapplications.co.uk will make job hunting easier and assist employers in targeting suitable applicants.

“Even people like me who are dyslexic will find the site easy to use,” he says. “Business Link has helped with the funding.”

>> Queen commends seven Seven North East firms have had their enterprise recognised in the latest round of Queen’s Awards.

They are: Advanced Electronics, Cramlington; Bond Foundry, Castle Eden; Entek International, Newcastle; Tiger Filtration, Sunderland; DuPont Teijin Films UK, Middlesbrough; Soil Machine Dynamics, Wallsend, and Rayovac, Washington.

>> Quick off the mark The Newcastle Building Society branch that opened a year ago on Northumberland Street, Newcastle, has become one of the society’s best-performing offices, outstripping all initial targets set for its 12-strong team.

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>> Fitness fitout Bannatyne Fitness has invested in £40,000 of new fitness equipment for its health clubs at Durham and Ingleby Barwick.

>> Go Wansbeck’s fishy legacy Go Wansbeck, the Northumbrian business support group, looks certain to fold in December, victim of the public spending cuts.

Programme manager Martin Townshend says the organisation’s already-shrinking operation can only continue until then because the final nine months are being financed from surpluses budgeted for earlier. At its peak it was setting up 100 new businesses a year on average In an area particularly hit by coalmine closures.

It was set up in 2007 with more than £16m in state funding after the Wansbeck area had been found to have six times fewer businesses per 10,000 population than some London authorities.

One of Go Wansbeck’s final achievements is also one of its most notable. With One North East it jointly funded Astec Aquaculture Business & Science Centre to encourage the farming of fish, crustaceans, molluscs and aquatic plants under controlled conditions.

Close to the coastline at Lyne Sands, Astec –

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under chief executive Kevin Haddrick – is well placed for supplies of near-tropical temperature flow-through seawater to its laboratories. These serve both commerce and research for the benefit of medicine, foodstuffs, sport and renewable energies.

Professor Grant Burgess, director of Newcastle University’s Dove Marine Laboratory at Cullercoats says: “As the world’s first aquaculture incubator, Astec will draw companies to the region.”

At its peak it was setting up 100 new businesses a year on average in an area hit by coalmine closures >> 100 years up Stadium Electronics, which celebrates its centenary this year, showed an operating profit of £3.34m in 2010, on turnover of £44.8m. It makes electronic products over a range of sectors and, besides the 120 staff at its Hartlepool headquarters, it has 1,100 more in manufacturing in Rugby and in China.

>> City for value Newcastle’s high street shopping is second only to London’s for cheapness in the UK, according to comparison website Kelkoo.

>> Ele’s top notch Ele Brown, with the National Audit Office in Newcastle, was one of nine students achieving outstanding results in the ICAEW professional stage examinations. One of 420 trainee chartered accountants, she took first place and the Railton Prize for her performance in a business strategy paper.

SPRING 11

COMPANY PROFILE

Employees of PD Ports are among the latest to sign-up for the two-year Foundation Degree in Leadership and Management offered by Teesside University Business School

LEADING ON THE WATERFRONT

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AVE Douglas left school at the age of 16 to join the army, but nearly 30 years later he is about to graduate with a Foundation Degree in Leadership and Management from Teesside University.

The one-time soldier left the army to become a stevedore at Tees Dock at the age of 27, loading and unloading cargo bound for all parts of the world.

Now, 15 years later, Dave from Middlesbrough is the Training Officer for PD Ports, which as well as running Teesport and Hartlepool Docks, also has other port and logistic operations throughout the UK. “The job involves training all the dock and logistics operatives, but apart from my time in the Dave Douglas, training officer for PD Ports, military 30 years ago I have had no training in pictured at Tees Port leadership or management. That’s until I was asked by the company if I wanted to do the East and with employer organisations such as foundation degree in 2009,” says Dave. regional chambers of commerce outside the He is one of 14 port employees on the two-year North East.” foundation degree run by Teesside University Dave says: “I now have a much better belief in my Business School, and says it has been a great own abilities and much more self-confidence since confidence booster for everyone on the course. being on the University course.

Programme leader Andrew Dale says: “We’ve “I left school at 16 with just a couple of CSEs and designed this programme around the needs and went straight into the army, so yes, studying expectations of PD Ports. It builds on our for a degree is something I never dreamt of experience of successfully developing the until recently.

Foundation Degree in Leadership and Management “It has certainly broadened my outlook and made with the North East Chamber of Commerce, for me realise the importance of inter-departmental which we won the Times Higher Education Outstanding Employer Engagement Initiative dependencies. There’s a lot of learning to do, but I Award last year. have certainly found it worthwhile, especially in “We’re delighted to be running this programme for terms of the importance of building on my PD Ports and the participants have been excellent. weaknesses rather than my strengths to do my Spark magto band:Layout 1 21/12/10job effectively.

09:55 Page 1 Now we areBQ looking develop the programme with PD Ports and other employers in the North “Instead of just fire-fighting, I now look at the

A spark of inspiration

www.tees.ac.uk/spark

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bigger picture and try to find the root cause of any problems rather than just wait until it happens again. I hope it’s made me more of an inspirational leader and I now take criticism much better. I was always afraid of failure in the past.

“I also understand more clearly that I’m not just managing a team, but a group of individuals who make up our team,” says Dave.

Providing they graduate successfully from the foundation degree, Dave and many of his colleagues, who have been studying while working, hope to continue their studies for a further year to gain an honours degree.

“I would definitely recommend the Foundation Degree in Leadership and Management to anyone who wants to improve their job prospects and gain a better understanding of managing and leading people,” says Dave.

David Robinson, PD Ports’ Group Chief Executive Officer is delighted by the progress the first cohort of his company’s employees have made on the two-year programme: “The degree programme provides a unique personal development opportunity for employees such as Dave to develop and enhance their skills, allowing them to more effectively lead and manage people within the organisation. We are very proud of Dave’s achievement, and all the other staff involved in the course, who have demonstrated impressive commitment to developing their roles and skills.”

For more information about the Foundation Degree in Leadership and Management contact Suzanne Withrington, Account Manager at Teesside University Business School.

T: 01642 738518 E: s.withrington@tees.ac.uk

The University for BUSINESS

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Westbound: Roman is switching its Haven brand from China to Newton Aycliffe.

>> Roman way Shower manufacturer Roman Ltd is reversing current trends – moving the manufacture of its sister company’s range of enclosures and bath screens away from China and into Britain and its Newton Aycliffe factory.

Managing director David Osborne says Haven, Roman’s low-cost alternative set up in China in 2006, is being switched because imported goods are seeing great fluctuations in currency exchange and higher shipping costs

>> Bang up to date Walworth Castle hotel, whose origins near Darlington go back to 1150, aspires to four star status with latest plans for a spa. It already has a hair and beauty salon. The castle, set in 18 acres, has been described as one of the finest habitable castles in the country. www.walworthcastle.co.uk.

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>> From bones to business More academics are turning their love of teaching and research into new business ideas.

Take Dr Tim Thompson, a senior lecturer in crime scene science and digital forensics at Teesside University in Middlesbrough. When the phone rings late at night for him, it’s likely to be the police saying they have found a skeleton. What they need to know is whether they’re dealing with a recent crime or have stumbled across some archaeological remains.

Dr Thompson doesn’t mind – he’s used to it.

And he sees it as a useful way of sharing his knowledge and expertise for the benefit of the world outside the university.

But he does think the identification process could be more accessible for those who, unlike him, don’t have a PhD in forensic anthropology.

So, after doing well in a regional competition for would-be entrepreneurs from universities in North East England, Dr Thompson polished up his business plan. And, with a grant from the university’s Enterprise Development Fund and a fellowship from Teesside’s DigitalCity (an initiative backing local digital start-ups) Dr Thompson launched his spin-out business, Anthronomics, this year.

He says: “In a lot of forensic anthropological work, we’re still using pen and paper and stills photography. My idea is to digitalise as much of the process as possible, developing appropriate protocols for scanning the bones into 3D models. Bones are actually very

difficult to scan. You’re dealing with holes and pores, lumps and ridges and a combination of organic and inorganic materials. It’s not as easy as you might think.

“But my new company plans to work with experts at the university, including our own Teesside Manufacturing Centre, to create the scans.

“Using our new software, we hope to give much quicker information to people who aren’t trained forensic anthropologists – about the sex, age and height of the body. This will be a great help in determining what the police might be dealing with – a recent murder victim or someone who died centuries ago.”

Dr Thompson’s new company is based in one of Teesside University’s business incubation units and will have its first scans available by the end of the summer.

“It will be a great classroom aid for teaching biology, anthropology and forensic science,” he says.

Contact Dr Tim Thompson on 01642 342535 or email: t.thompson@tees.ac.uk

>> QUOTE OF THE QUARTER

“The companies here have been able to lay the ghost of this belief that exists in the UK – more than it does overseas – that the UK is not the world’s best at producing major productions on time, to budget and to this quality.”

John Armitt, chairman, Olympic Delivery Authority.

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But time is running out! Workshops are only available until November so act quickly to register your place www.financeworkshops.co.uk Business Link can give you independent advice and guidance or help you find the best assistance for your business.

Visit your local Business Link at www.businesslink.gov.uk/northeast or alternatively, give them a call on 0845 600 9006.

If somebody complains about you on Twitter, it is a far better strategy to engage with them on a level and turn things around Paul Asensio: Head of digital at award-winning communications agency Drummond Central. He is a regular blogger and an authority on social media.

BUSINESS QUARTER | SUMMER 11

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SUMMER 11

AS I SEE IT

KEEP SOCIAL NETWORKS SOCIAL People recognise the power of social networking, but there’s uncertainty over how best to harness it. When Paul Asensio is asked: ‘Will social networks work with my brand?’

He believes the answer is twofold It may sound obvious, but the first thing about social networking is... keep it social.

Social networks are about relationships, not about a company owning and controlling the conversation.

The challenge is how best to promote a “read-write” relationship with your target audience. It shouldn’t be a cynical move, but an honest and positive determination to engage better with those who really count.

The Web has become a complex world of interactions, and the user experience has heightened to a point where much more is expected of brands nowadays. The conversations will take place whether you are there or not, and with up to 20% of our daily conversations taking place online, isn’t it preferable to get involved in these conversations and position yourself to learn from them and influence them?

Whereas the Web has revolutionised our communications, social networks such as Twitter, Linkedin and Facebook have revolutionised the Web. We have embraced a 24/7 society in which we shop online, bank online, work online, entertain ourselves online, communicate with friends and family online and even fall in love online.

People have stopped “going” online and instead are continuously “being” online across a number of Web-driven platforms, from laptops to smartphones. To some who look back through rose-tinted glasses at a pre-Web world, it can be with a deal of regret. But to

many more who have adopted digital, and to the younger generation who are digital natives, the Web has opened up the world and infinite opportunities and relationships.

Secondly, to the question “will social networks work with my brand?” the very culture of a brand is critical. Can you deal with the public talking about you in good times and bad?

Unlike yesteryear, bad news stories are no longer tomorrow’s fish and chip wrapper.

Rules have changed. Things tend to spread easily and hang around a long time online.

This can be grasped as a great opportunity or as a threat to be avoided at all costs. It can also be tempting to be dismissive and convince yourself that only “losers” and “geeks” communicate online. Ask around and you’ll find those “losers” and “geeks” are your neighbours, your parents, children, partners and colleagues.

The thing is, nobody is perfect. Nobody expects anybody else to be perfect and they certainly don’t expect brands to be perfect.

The only thing customers demand time and time again is for your brand always to try its hardest to be perfect, and not just pretend.

When you also include the customer on this journey, and involve them in achieving this, you really have hit the bullseye. Because society is more engaged with brands than ever before, they have also grown to expect this inclusion.

People extend the benefit of the doubt if a brand is honest. Again, these conversations

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will take place anyway. So it is more important to be involved in those conversations in the places where they are happening and allow your brand to engage in an open, honest and accepting way. Communications have been revolutionised and everyone has to get to grips with new relationships and engagement with customers, otherwise you open yourself up to competitors who will inevitably pull the carpet from under you.

Your “brand” is not your logo, your company or mission statement. It is wider than that and includes your user, customer, or stakeholder.

It includes their perceptions, their feelings and their emotional connection with your brand. Social media develops this by providing a conduit.

This type of interactive customer service through social media is also an effective sales tool. The interaction doesn’t just affect the person you are communicating with; others will see your conversation as well. If somebody complains about you on Twitter, it is a far better strategy to engage with them on a level and turn things around. I continually see brand advocates being made by brands which reach out through these channels every day.

You are going to need to heed the old adage of “know your audience”. What do they want, what can you offer them and, more surprisingly, what can they offer you? What insights can they provide? How can your product or service be improved? How can you keep ahead of anticipating user needs?

Segmentation, targeting and messaging relies on this knowledge.

By engaging with customers better, brands are succeeding in a crowded marketplace to extend reach and develop greater brand recognition and loyalty. Being proactive and going to where the people are will keep you close to your customer, plugged in and more importantly than ever... engaged. n

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SUMMER 11

ENTREPRENEUR

HYDROGEN GOES BOOM After years of helping other companies get off the ground, David Bowles is chairing a company that will try to persuade us that hydrogen is the energy to use now for our cars, our kitchens and our frontline troops.

He tells Brian Nicholls why As gadgets go, this box of tricks impresses.

It will remove fears of a conk-out for drivers when electric cars come. For our defence chiefs it could slash costs of supplying our frontline soldiers in the outlandish likes of Afghanistan.

In the kitchen it could certainly save our bacon – as well as our cakes, roast joint or whatever else is in the oven – come a power cut.

The chairman of the fledgling business turning out this electricity generator with a difference is David Bowles, a man who has weaned more young companies for others than probably even he can recall during 30 years in the North East.

In the chairman’s seat at Entrust, now passing over to Ashley Winter, he has helped raise

finance and other essential support for start-ups. But his succour goes back beyond to the 1980s and ‘90s when, as a director of Northern Development Company, he beavered non-stop to bring investment and jobs to the region.

In 2001 he was a key figure setting up Northern Defence Industries, linking smaller manufacturers into the supply chains of global names. He has worked to advance commercial radio in the North East too. When someone, somewhere recently reported Bowles as retired that must have been a joke.

His enthusiasm today is for a County Durham start-up he now chairs, Inova Power Ltd. It markets a black box promising so much – with an injection of powder – not only to >>

I was invited to talks about Inova’s project. It took me only two lunches to decide I should agree to chair the business. I feel privileged now to have been invited – excited too

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North East inspired While it sounds revolutionary, hydrogen fuelling in essence is retrotechnology with some North East origin.

Nailis explains: “While putting electricity into water and feeding that water into the fuel cell sounds very Jules Verne, it’s only what Apollo astronauts have been using.

“And long before, in 1870, it was developed by a lawyer but only picked up again in the 1930s by the modern father of the fuel cell, a Cambridge graduate called Francis Bacon. He worked to get the technology off the ground on Tyneside at Parsons and Merz & McLellan (now absorbed into Parsons Brinckerhoff with which it merged in 1995).

Nailis continues: “Bacon worked at it until the 1950s. Finally the fuel cell not only got off the ground but went all the way to the moon. The astronauts needed oxygen, hydrogen, water to drink and electricity.

For them it was perfect. But theirs was a huge device and not as efficient as now.

We have a micro fuel cell that is pretty well leading edge.”

Initially the product will be for stationary generation, practical for the chemical sector and defence, and direct injection into engines. But many more opportunities will follow, Nailis says: “The North East is a leader in developing the next generation of low carbon vehicles. We have an ideal complement.”

BUSINESS QUARTER | SUMMER 11

ENTREPRENEUR motorists, soldiers and householders, but to champions of sustainable energy and other environmentalists.

The invitation to chair Inova and go with hydrogen surprised Bowles. He is after all a self-confessed “petrol head”. On first coming to the North East after service with the Royal Air Force in the Middle East, he had sold what he calls “a dustbin lid with an engine on”.

He’s being facetious of course, because while he was sales and marketing director of Flymo at Newton Aycliffe it developed into a global brand in outdoor and garden machinery – European market leader in fact, with Queen’s Awards.

Bowles has continued to get his fuel kicks annually attending Le Mans 24 Hours race. But it looks as if he will have more to occupy him in the future.

“I was invited to talks about Inova’s project,” he says. “It took me only two lunches to

Up the Khyber Mark Nailis quotes logistics in Afghanistan to illustrate his claim of Inova’s potential value to defence budgets.

In Afghanistan, he says, it costs up to $350 to have a litre of fuel sent from Karachi through Pakistan, up the Khyber Pass and on to forward operating bases, where in the absence of relayed electricity the fuel powers a generator to charge batteries and facilitate cooking, heating and communication.

The fuel transported every seven weeks in a heavily armoured line of vehicles has to be protected overhead by Apache helicopters, all this because diesel cannot be flown in for safety reasons.

“Yet we have a unit into which could airdrop powder instead that would last more than a year, and the powder is useless to anyone without a conversion kit,” Nailis says. “On the other hand, even a well with polluted water would suffice for such an operation. At the same time the water could be made fit to drink.”

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decide I should agree to chair the business. I feel privileged now to have been invited – excited too.”

Inova Power managing director Mark Nailis says: “We have known David for years. He has worked for appropriate organisations. His knowledge and experience of marketing is immense and he excels at helping to emplace governance and strategy. You can be very vulnerable if you don’t have governance in place properly these days.”

Bowles’s task will be winning converts to new thinking and purchasing in fuels and electricity.

The device Inova already has orders for is being developed in league with China and Sunderland University.

It powers cost-effectively mobiles, laptops, home heating and lighting, refrigeration, air-conditioning – and, of course, cars.

“A child can understand and work it,” Bowles claims, though he is still getting to grips with it himself.

He has in front of him a prototype hydrogen maker standing about a metre high, a third-of-a metre wide and two-thirds of a metre long.

Bowles explains: “We have a powder to mix with water, the water being a storage medium and catalyst. Water is H2O after all, hydrogen and oxygen mixed.

“The powder drives the hydrogen from the water into storage elsewhere. Then at one end of the box we have a generator, and in the middle a fuel cell to turn the hydrogen produced into electricity.

“Then you plug whatever you like into the other end of the box, provided you have appropriate power there. We have initially a 400 watt unit – enough to power quite a few things.”

Resultant electricity can feed fuel cells or meet increasing demand for direct injection of hydrogen into diesel engines.

Bowles says of hydrogen’s potential: “Many people are after new ways to secure electricity so we have a bread and butter market of off-grid power. A number of firms have concerns that the National Grid is not as reliable as it once was. It could crash one day through a lack of investment over years.

“One of our competitors has a deal to provide emergency power for Vodafone’s telephone

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masts in Africa. Their remote situation can threaten disruption.”

Inova itself has been approached by a major supermarket group that may hydrogenise its electricity to sustain its store freezers during any grid failure. Individuals in a similar predicament could expect Inova’s box to keep their mobiles, laptops, home heating, refrigeration and air-conditioning going.

“It’s a growing area of interest,” Bowles says.

“For every gram of our powder mixed with water you get 100 litres of hydrogen, and it doesn’t need much water.”

And the water left post-process is potable. So in arid areas, all sorts of water can be used – brackish, sewage, even urine – and voila, drinking water as well as electricity results.

Benefits are also evident in more conventional areas. In Japan, Hitachi has built a small town of houses self-powered by a combined heat and power unit fuelled by hydrogen. The German government has a similar project for 50,000 homes.

China’s government – hugely committed to alternative energies – endorses hydrogen and is persuading businesses to adapt. The Chinese firm Inova is partnering manufactures what Inova will sell under licence.

Bowles says: “The Chinese are very interested in our market contacts and how we can build business in the UK and mainland Europe, the Middle East and Africa. I think over the next 10 years or so we shall see massive expansion in the availability and use of hydrogen.”

Sales of the powder promise a major income stream.

“Using this appliance at home will be like running a Dyson or a steam iron,” Bowles suggests. “Hydrogen is considered to burn three times more efficiently than any other fuel in use and is volatile. So, once water and powder are interacting the hydrogen must be properly stored. But the storage tank here provides the safeguards.”

Inova, one year in the planning, has five directors who envisage something like 50 jobs arising within three years. Another 150 could benefit in the supply chain.

The management comprises managing director Mark Nailis; Gavin Townsend, operations; chief scientist Dr Bob Jennings (formerly head of catalyst research at ICI),

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and two ex-Nokia men, Christian Bunke the legal and patents specialist, and David Wilkinson, chief financial officer, who is well acquainted with venture capital firms.

Their interest may be kindled by Nailis’s conviction as a chartered engineer that one application alone could be worth “a fortune”.

He has worked in Japan off and on for 20 years, developing and commercialising new products in consumer electronics. He has also worked on automotives design in Japan, on defence, and with a UK research centre specialised in hydrogen technology and fostering university spinouts.

Also involved is the Korean developer of the powdered process, Dr J Park, formerly a top researcher in battery technologies with Samsung.

Inova occupies an incubator unit at NETPark Science Park. If the growth envisaged is

ENTREPRENEUR

We could double an electric car’s range within months and are talking to vehicle designers along these lines.

We would hope to work with a range of manufacturers achieved, larger premises on the park will be considered.

Bowles reveals: “We have already had overtures from the South of England. We are not interested. Most principals in this business are based here. Why move south?

“We are raising finance from here and we are already working with potential customers.

Our generator is ready to sell. We are on the cusp.”

Sunderland University has bought the first unit, a prototype that can be scaled down to power outputs as low as two watts – to recharge a mobile phone – or up to 100 watts to power a major combustion engine.

The Institute of Automotive and Manufacturing Advanced Practice (AMAP) is working with Inova at the university to commercialise the product and operations manager Adrian Morris considers Inova’s >>

Reading about them is valuable.

Connecting with them could be invaluable.

The Entrepreneurs’ Forum was created by entrepreneurs for entrepreneurs. Our aim is to support one another to build the biggest, most successful businesses we can. Whether it’s attending our world class events or taking advantage of our altruistic mentoring programme, you never know what being part of the region’s most influential business forum could do for you. It could be something you learn, a chance meeting with a like-minded colleague or the opportunity to give something back.

To find out about membership and how you and your business can get connected to the wisdom and inspiration of our hundreds of like-minded members visit www.entrepreneursforum.net or call our team on 0870 850 2233

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BUSINESS QUARTER | SUMMER 11

ENTREPRENEUR

SUMMER 11

system a major breakthrough for transport, dovetailing into the region’s current project to achieve minimal carbon emissions.

While AMAP has been concentrating on fuel cell technology for vehicles, Inova’s quest has been new ways to make hydrogen, and from there to see consumer anxiety towards electric cars reduced.

The major market resistance initially, Nailis expects, will be the relatively short distances they run without requiring a recharge – roughly 100 miles – and even less, in cold weather since the car heater will also run off the battery, reducing the power supply.

An Inova box might extend the run by 20 to 50 miles, ensuring safe arrival at a recharging point.

Nailis explains: “Our sister company in China has effected a continuous charge within an electric vehicle. So we could double such a vehicle’s range within months and are talking to vehicle designers along these lines. We would hope to work with a range of manufacturers.”

He envisages a system akin to a video cassette, with users buying packs of five from garages to insert in the equivalent of a cassette machine in the boot. Nissan’s electric car, the Leaf, will be made in Sunderland from 2013. n 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.

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To find out more please visit www.entrepreneursforum.net

Converted: David Bowles is convinced that hydrogen holds the key to energy’s future.

BUSINESS QUARTER | SUMMER 11

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11/07/2011 15:50:55

SUCCESS STORY

SUMMER 11

in association with

SEAT BELTS FASTENED

More seats to the Middle East before long raises hopes that North East business may also see the long-held aim realised of a daily New York ight to and from Newcastle. Brian Nicholls talks to Laurie Berryman, Emirates UK vice-president for the UK and Ireland

BUSINESS QUARTER | SUMMER 11

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SUCCESS STORY

I knew when we looked at the route back in 2006 that it would be a success.

All the logistics pointed to a population in the North East of England who were being restricted as to where they could fly, long haul We can be sure of one thing in these otherwise uncertain business times. North East air links abroad – the route to export opportunities – are going to get a huge boost.

Emirates airline is reconsidering its previously deferred plan to replace, with a much larger Boeing 777 aircraft, its Airbus A330 that flies North East passengers daily to the Middle East and onward to many other parts of the world where business is to be found.

Flights between Newcastle and Dubai then, if the change goes ahead, would each seat 428 passengers instead of 278. Emirates’ decision to revisit its North East potential follows an 8% increase in passenger growth at Newcastle during the past year to March 31.

At the same time, the Dubai airline – recently named Airline of the Year – is intensifying searches for an acceptable alternative to the British Government’s controversial air passenger duty (APD), whose blanket application is hurting not only Newcastle and Durham Tees Valley airports, and many more regional airports besides, but also North East businesses that are trying to boost sales by exporting in a period when currency exchange rates favour it.

Since the daily Emirates service to Dubai began in 2007, trade between the North East and Australasia alone has trebled from £100m to £300m, for which the airline is widely credited.

The passenger tax therefore, in government revenue terms, is self-defeating. Asked by BQ in exclusive interview about the likelihood of a stepped up North East service in light of the airline’s recently announced soaring profit throughout, Laurie Berryman, vice-president for UK and Ireland, revealed that Emirates is now taking delivery of 52 more of the larger

aircraft, one of which would probably be assigned to the North East.

“I personally believe, without knowing anything for real, that the prospect of a 777 may be nearer now for the North East,” he says. “When recession hit, we delayed bringing in new aircraft. But that deferment has now ended.

“For the next two years, between May 2011 and March 2013 we are taking delivery of 52 more aeroplanes. I am sure one of those new 777s will find its way to Newcastle. It’s certainly on our wish list.

“Our last financial year showed Newcastle growing by 8%. That may sound constrained, but the load factor was so good there wasn’t

much space to grow into. In cargo too we carried another 300,000 kilos. So Newcastle went on growing at a good rate – a record year for load factors. This contributed, along with all the other routes, to make a fantastic profit for the airline.”

It’s good news too for Newcastle Airport during a period when another regional airport, Plymouth, has announced its closure. Emirates, with an additional four million passengers worldwide, actually equalled British Airways in size before the latter recently merged with Iberia. In a 23rd consecutive year of profit, Emirates’ overall passenger rise of 14.5% to 31.4 million did much to hoist revenues 26.4% to $15.6bn. This, in turn, hoisted gains 52% to a record $1.5bn (£900m).

Berryman recalls: “We started the Newcastle route just as the global recession began in September 2007. Within a week, Northern Rock hit its first problems. So we had a fairly tough time early on.

“But I knew when we looked at the route back in 2006 that it would be a success. All the logistics pointed to a population in the North East of England who were being restricted as to where they could fly, long haul.

“They always had to go somewhere else, Amsterdam, Heathrow or somewhere like >>

The figures don’t half add up The significance of Emirates in air travel and freight and the consequent importance of the Newcastle connection may be gauged from the fact that the 52 new aircraft – one of which might boost the North East’s travelling options – are only part of Emirates’ shopping list. It has orders for 193 new aircraft altogether, a total investment of $66bn.

Emirates, named Airline of the Year 2011 by Air Transport World, can well afford this, despite the financial adversities that real estate and other segments of Dubai’s economy met in recession.

Emirates, after only 26 years in business, is already one of the world’s top 10 carriers in revenue, fleet size and passenger kilometres.

With 31.4 million passengers carried last year it is recognised as the world’s leading airline in terms of kilometres flown by scheduled international passengers. It operates three of the world’s 10 longest non-stop commercial flights from Dubai – to San Francisco, Los Angeles and Sydney, journeys of between 15 and 16½ hours. And its present fleet of 153 all wide-bodied aircraft flies to 111 destinations in 66 countries.

It is the Middle East’s largest airline with 39,000 staff, and it will deserve much of the credit if Dubai International Airport, its hub, fulfils expectations and becomes the world’s busiest airport by 2015.

Besides sponsoring Durham County Cricket Club, Emirates has recently promoted business trips from Newcastle to Dubai as prizes in a North East competition.

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SUCCESS STORY The Government looks on our industry as easy targets. APD is the only tax they don’t have to collect. We have to collect it on their behalf and send a cheque regularly.

It’s a very good tax from their point of view. But bad from ours that to get to many places. I felt we could tap into that and the proof now is exactly that.

The new financial year has also started very strongly throughout for the airline. In April we showed growth of 36% and 82% load factor over the same month a year ago. We did have the dust clouds then. But it is still very good indeed.”

And while many North East passengers are disembarking in the Middle East for business or pleasure, many are also going on from there to Australia, Thailand, Malaysia, New Zealand, South Africa and Mauritius.

Berryman says the daily increase of passengers would represent “a pretty big increase” over a year. “Our only problem is that we have so many routes around the world competing for the new 777s that we shall have to wait in line. But it does sound promising for Newcastle.”

Emirates’ over-all progress shows 105 flights a week to Dubai from the UK now – from Newcastle, Heathrow, Gatwick, Glasgow, Manchester and Birmingham.

“A very strong spread,” as Berryman calls it

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Skyward: Dubai has developed into an important destination

– and making Emirates one of the few airlines using nearly all the top UK international airports. Its call centre staff at Wilmslow, who handle calls in 20 languages, is growing to 321 this year to cope with bookings.

It’s almost two years since Emirates carried its 250,000th passenger between Newcastle and Dubai and its three millionth ton of cargo. And on Newcastle Airport’s 75th anniversary it flew a Boeing 777 in as part of the celebrations. It flew 418 passengers out that day.

“That record for us still stands till we bring in the 777, then I’m sure we’ll beat that regularly,” Berryman laughs.

Cargo out features prominently chemicals from Teesside and inward, Nissan engine parts from Japan.

Live lobsters for Hong Kong diners also find a place in the hold.

But a major concern for airlines and airports alike remains the APD tax introduced in Britain by the previous government and now continued by the Coalition.

Ready for a bite at the Big Apple Emirates’ promise of more global links eastward could prompt many in North East business to urge again the introduction of daily scheduled flights west to the United States. Newcastle is the last major UK airport without them.

Jet2.com is putting on two Christmas shopping trips to New York’s Newark Airport this December, a seasonal service initiated in 2010, with full flights.

Chris Sanders, director of aviation development at Newcastle, has told BQ: “We know from analysis there is a large market in our region potentially for a scheduled daily direct flight to New York, which would also offer connections to all parts of North America – such as Continental Airlines offers through Newark. This really excites us.

“It is a question of when, not if, this will happen. Our senior team have met with executives from a number of US airlines and the appetite for this route is evident. However, as always, it depends on aircraft availability.

“A regular transatlantic flight would meet demand in developing tourism and also strengthen our business links with the Big Apple, and the US generally. The first airline to select Newcastle will secure this market and be able to offer an unbeatable travel proposition.”

Sanders points out that Newcastle is one of six UK airports which Emirates serves, whereas eight UK airports already have daily transatlantic scheduled flights.

“The success of this Emirates route helps support the case for a US airline to serve Newcastle,” he says. “It shows we have a unique catchment area more than capable of supporting intercontinental routes. Many businesses in our region have US links and many US businesses have invested here. Direct flights will grow business to the benefit of both countries, and Newcastle-New York will be a tremendous success.

“Other UK airports with a New York flight already had it before any flight to Dubai. We have rearranged the pages in the ‘UK route development handbook’ by going east before going west.

We consider that the start and not the end of the story.”

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The rate here is higher than anywhere else in the world. That, Berryman says, is impeding the capability of many North East businesses.

While Chancellor George Osborne announced no rise in APD for a year in his recent Budget, Berryman warns that it is only good news short term, explaining: “He has said at a meeting I attended recently that when he reviews APD next year he won’t just increase it for inflation this year but for inflation last year too.

“Consultation is ongoing and we are putting some alternative ideas forward – different zones perhaps, because APD is really hurting industry. If you go business class to Australia your APD now is £170 – ridiculous.

“OK, there are a few holidaymakers travelling business class, but mostly it’s business people and those are the ones being hurt.

“We at Emirates are about to communicate at a high level with the Treasury that Britain is being expected to recover from effects of recession by more private sector exporting.

Aviation can help there. Yet aviation is being picked upon.

“I understand Stenna Line ferry company is taking about 50,000 Indian passengers a year from the UK into Amsterdam. They know by flying back home from there they avoid paying £70 APD – a significant saving.

“We think the real solution is to find a better way, or reduce APD all over the country and not just make regional variations.

“You could have a crazy situation where people drive from Manchester to Newcastle to catch a cheaper flight, which might cause more pollution. So if the tax’s aim is environmental, which is claimed but which I don’t believe it is, it will do nothing for that either.”

The Government closed consultation on APD at the end of June and Emirates, with many others in the industry, had constructive alternatives ready to lay alongside the Government’s own ideas.

“The Government looks on our industry as easy targets,” says Berryman. “APD is the only tax they don’t have to collect.

“We have to collect it on their behalf and send a cheque regularly. It’s a very good tax from their point of view. But bad from ours.

“Some of its strange effects are seen just

SUCCESS STORY

across the Irish Sea. Flying out of Dublin, there is no tax at all. Flying out of Belfast, as part of the United Kingdom, you pay APD. “Many people in Northern Ireland now jump in their cars now and drive to Dublin for their flights, so saving the APD. “If we were part of mainland Europe I am sure a lot of people would be driving to Amsterdam or Dusseldorf to take a flight.

“The Dutch authorities did try a tax, but the Dutch public got in their cars and drove 100 miles in one direction to Brussels or 80 miles in another to Dusseldorf and took flights from there. Holland reformed and got rid of its APD.” Emirates does welcome and expect to benefit, however, from the British government’s decision through its Regional Growth Fund to invest in a 150-bedroom hotel, 2,000 seat conference centre, and a hospitality skills academy being built alongside Durham County Cricket Club’s ground, which Emirates sponsors.

“We are delighted about that,” says Berryman, whose previous jobs have included being British Airways manager in Qatar and sales manager for British Caledonian in Saudi Arabia.

“The cricket club is our major sporting investment in the North East. We are talking about one of the iconic cricket grounds of the UK – a fantastic venue for the Ashes in 2013.”

All in all, the North East is getting to know The Gulf region better through this air link and its sponsorships. Conversely, is the North East of England any better known now to the Middle East and other parts of the world served by Emirates?

“I believe it is,” says Berryman. “I accompanied my Arab boss on a trip to Newcastle a few weeks ago. He was very impressed by the North East and thought it absolutely beautiful. He told me seriously: ‘I’m going to go back and spread the word to my friends about the North East – tell them not to go to London but come and see other parts of the UK.’” Salem Obaidallah, senior vice-president, commercial operations Europe, clearly accepts there’s more mileage yet in this DubaiNewcastle connection. ■

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Opportunities in Asia Some North East companies have already taken huge advantage of the international markets. Asia in particular offers a number of Peter Sleigh: possibilities for Regional Director SMEs. Singapore is very westernised but has managed to retain its Asian values and represents the gateway to Asia. The economy has witnessed a rapid emergence of a strong consumer base with sales of luxury brands in particular performing very well. Hong Kong likewise provides a gateway into China but is a more accessible “entry point” for many businesses. China is still undergoing significant growth – it is moving away from being just a low cost producer, increasingly focusing on more added value sectors and developing its own infrastructure and consumer economies. Indonesia, Malaysia, Thailand, Vietnam, Cambodia and Sri Lanka are emerging as low cost production centres while India is investing in infrastructure, education and the rise of a very skilled workforce.

It is clear that UK companies of all sizes could benefit from working in Asia. We have International Experts in local Commercial Banking Centre, work closely with UKTI and other advisors, as well as an extensive network across Asia.

For more information contact: Peter Sleigh, Regional Director, Commercial Banking, North Tel: 07901 588031 peter.sleigh@rbs.co.uk ahead.natwest.com

All information within this magazine is produced

by Room 501. Please note that the views and information have not been endorsed, issued or approved by NatWest. Any views expressed in this magazine are not necessarily those of NatWest.

BUSINESS QUARTER | SUMMER 11

COMMERCIAL PROPERTY

SUMMER 11

A community church opens its doors, city centre growth continues in Newcastle, Dalton Park expands against advice, Team Valley celebrates 75 years and Collectables likes the out-of-town scenery

Chain welcome: Buca di Beppo staff Rob Burr and Katie Firth prepare to welcome customers at the new Italian restaurant at Cobalt Park

>> First in the UK The American Buca di Beppo chain, a sister company to Planet Hollywood, has opened its first UK restaurant at the Village Hotel on Cobalt Business Park, North Tyneside.

Cobalt has been named one of the top places in the country to work. Research by East West Locations consultancy describes Cobalt, the UK’s biggest office park, as top tier for career development and ideal for recruiting quality workforces.

It says it has a higher than average proportion of 20-30 and 30-40 year olds.

>> Business centre with a wealthy touch One of Scotland’s wealthiest entrepreneurs, Sir Tom Farmer, is behind the opening shortly of a branded business centre at Gateshead.

Morston Assets, which he jointly established, is adapting a former British Telecom building to become a Yours Business Networks centre, the third and largest so far in that portfolio of the Holt, Norfolk-based firm.

The 40,000sq ft building will offer managed workspace with open floor

BUSINESS QUARTER | SUMMER 11

plates, also meeting areas with video conferencing, a café and a gym. It will have 100Mb broadband and links to universities and other educational centres.

The site the building stands on – beside the A1 and near the Metrocentre shopping centre – was acquired in 2008 for £20.25m. The 222,7675sq ft site includes the entire Watermark and Metro-Riverside Parks. Tyne Tees Television is among companies already based there.

Gateshead’s Tolent Construction is refurbishing for an end-July opening.

Gunel Atkinson, YBN’s operations manager, says: “From September we shall bring world-renowned business leaders to offer support and guidance to businesses in the North East. This has been incredibly successful in our other centres.”

The other centres are at Nantwich in Cheshire and Kings Lynn in East Anglia.

Approval has also been granted for one at Whitecross in Herefordshire.

Sir Tom Farmer, founder of Kwik-Fit, runs Morston Assets, a property investment, development and regeneration company, with property entrepreneur Tom Harrison.

The firm founded in 1991 is worth about £200m.

>> Bless them, they’ve bought A community church has bought a new 2,174sq ft office in Newcastle’s Ouseburn Valley from Priority Sites, the regeneration specialist owned by The Royal Bank of Scotland and the Homes and Communities Agency.

The Media Two building acquired by Newcastle Christian Life Centre (NCLC) is part of the £4.4m Media Exchange development on Coquet Street, Newcastle – a development of nine office suites completed in 2009. Three suites are now sold or let.

Alison Dicken of NCLC says: “We’ve been looking for a permanent base in the city centre

36

for two years. This building provides much-needed office and meeting facilities, also space for our groups to gather. We have a media suite here and our bands have space to rehearse.”

NCLC, founded in 2005 by Pastors Jon and Dee Cook, has a weekly congregation of about 600 who meet for services at Newcastle’s Centre for Life and Teesside University Students’ Union.

>> Hotel prospect Network Rail and 3R Land and Property of Newcastle hope to develop a twohectare site on Askew Road, Gateshead, giving offices, a hotel and restaurant, and creating 150 jobs.

Moving in: Outside Beaumont House are, left to right, David Brown, operations director; Nigel Ward, commercial director, and managing director Jake Tompkins

>> Trenchers move in Subsea trenching and construction contractor Modus is forecasting a 35% rise in turnover in the coming year after moving into new offices with its 26 staff.

The firm, under managing director Jake Tompkins, was set up in 2008 and has moved into the newly-refurbished Beaumont House, owned by Beaumont House Partners, from its previous home on Carmel Road, Darlington.

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COMMERCIAL PROPERTY >> Seventh heaven Commercial property firm Sanderson Weatherall has been named the leading property adviser for the North East and Yorkshire for a record seventh year at the Estates Gazette Regional Awards 2011.

It is now also joint letting agent for Middleton Grange in Hartlepool, the North East’s third-largest shopping centre with 130 units.

Welcome: Northumberland Park has another occupant

>> Sky moves in

>> Buyers on the park Explore Wealth Management Ltd has bought 2,250sq ft of office space – Unit 7 at Berrymoor Court on Northumberland Business Park. The park, developed and owned by Gladman, has 100,000sq ft of office space ranging from 2,035sq ft to 25,500sq ft.

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Media company Sky has taken three floors, 40,000sq ft in total, in Wellbar Central, a tower block beside St James’ Park football ground in Newcastle.

It is opening a newsroom and a call centre in the building which was empty for 18 months following refurbishment and earlier use by the public sector.

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COMMERCIAL PROPERTY

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>> Warnings defied

>> Master strokes lift city potential Stepped-up master planning is getting credit for developers’ rising interest in new business districts that should, in turn, encourage city centre growth in Newcastle.

Both the Discovery and Stephenson Quarters are giving the city best of both worlds – redevelopment and regeneration of existing, well-crafted buildings, along with extensive redevelopment, says Chris Pearson, partner of Gavin Black & Partners.

Graham Wylie: Expertise for 1NG Existing partly-listed properties in the Stephenson Quarter and the area generally referred to as “behind the Central Station” are conveniently near the heart of the city.

Silverlink and Buccleuch Estates are taking advantage amid some hesitations elsewhere.

But potential remains, ranging from smaller properties such as Friar House to major plans

by Silverlink.

The Silverlink proposals centre on an area bounded by Forth Street to the north, Forth Banks to the west and Central Square 1 and 2 to the east. A seven-phase development across all sectors – hotels, offices, retail, residential and more – is projected.

The larger regeneration area, Discovery Quarter, has already attracted notable investment, being a new, highly visible gateway from the south west to Newcastle city centre. With a link via the Redheugh Bridge to Gallowgate via St James Boulevard, developments have already been carried out – Wellbar Central, the new office scheme in Gallowgate and St James’s Gate are two fine examples.

Science Central and redevelopment in this central part of the Discovery Quarter stresses the potential to serve as an economic driver of the city centre, says Pearson. And this allows growth to the west previously almost stopping at Newgate and Percy Streets.

Discovery Quarter encompasses the former S&N Brewery site – now Science Central and Downing Developments – the lower part of Westgate Road, and sweeps south to bring in part of Scotswood Road and the area south to the river Tyne.

Pearson says: “This is a huge area with good roads and largely brownfield land, allowing large scale development to match large scale vision.”

Lord Charlie Falconer, chairman of 1NG, the Newcastle and Gateshead development company, says 1NG has made strides in Ouseburn and East Quayside and is pushing forward the Science Central project on the former brewery site, now with outline planning consent.

“But much remains to be done long-term, and with two key leaders supporting our future economic vision we are confident of getting there,” he adds – the two figures being entrepreneur Graham Wylie and Councillor Nick Forbes, leader of the city council. They have joined 1NG’s board.

Meanwhile John Rundle is now interim director of Newcastle Science Company Ltd (NSCL) which aims through Science City to establish Newcastle and the North East as a global leader in fields of ageing and health, sustainability and regenerative medicine.

He has taken over from the recently departed chief executive Peter Arnold. Rundle was previously director of The Northern Way agency and led a review of partnership structures in the Tees Valley, as well as managing the establishment of 1NG. Science Central is back on track with a £3m relief package filling a void left by the impending demise of regional development agency One North East. The city council and Newcastle University, which already have stakes, are investing further to assume control as partners.

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Against their officers’ advice, the planning committee of Durham Council has approved three retail schemes in the county.

They hope to see 1,000 jobs resulting from the decision. Scheme One enlarges Dalton Park out of town outlet between Murton and Seaham, providing a food hall, drive through restaurant, pub/hotel, and five-screen cinema.

Scheme Two would see a Tesco at nearby Peterlee. Scheme Three would have another food store, proposed by the owner of Castle Dene shopping centre in Peterlee. The officers warn businesses in Seaham town centre could be hit.

Back in business: Dewan. left, and Nahil Raja are restoring Raja flavours at the restaurant they have returned to

>> Restaurant re-occupied The Diwan-E-Am Asian restaurant in Hexham has been taken over by the son of its first owner. Nahil Raja’s father Dewan founded and ran the business from 1983 until retiring in 2005.

The restaurant is now back in the family’s hands under Nahil, 32, and Dewan, 67, who will provide some of the spice blends that built the reputation of the restaurant earlier.

>> 100 jobs at the Gates The Gates Shopping Centre in Durham City has let six units in nine months, bringing almost 100 jobs.

Wilkinson superstore has opened in the mall’s flagship 19,000sq ft former Waitrose. A

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branch of Stephanie’s Florists has opened also, and an Alan Clarke Photography studio. The centre also welcomed Central Thai restaurant and the return of Priceless Shoes. The new Bon Appe Feet foot spa is another opening.

The Framwellgate Bridge destination is home to more than 40 stores now.

Trolleys in: A shopping trolley builder has replaced electronics giant Samsung on Teesside

>> Last of Samsung The factory that electronics giant Samsung abandoned is now occupied by a builder of supermarket trolleys.

Following one of the largest single industrial space lettings on Teesside in recent years, the former Samsung factory at Cowpen Lane Industrial Estate is now occupied by Storage and Handling Equipment, a Billingham specialist in trolley assembly.

The 150,000sq ft deal was done for Bilsdale Properties by Sanderson Weatherall.

>> Knees up in the Valley Team Valley, the UK’s largest business of its kind in single ownership, is enjoying a summer of celebration marking the 75th anniversary of its start.

On 18 May 1936 the UK’s first governmentfunded industrial estate began to take shape.

The aim? To mop up mass unemployment by encouraging growth of private industry. Similar ventures had opened at Trafford Park, Manchester in 1896 and Slough in 1920. But these had been privately financed.

With jobless levels at almost 60% in the North East, the Government chose 700 acres at

COMMERCIAL PROPERTY

Gateshead over several other suggested sites. With an initial budget of £70,000 (equal to £3.5m today) it envisaged a well planned industrial estate with a wide arterial road layout and a rail link to the national railway network.

A North East Trading Estates Company under a dynamic and outspoken Colonel KC Appleyard oversaw the building of diverse industrial units to let.

London based George Wimpey & Co got the building contract worth £80,000 (£4m now) but had to employ mainly local labour. The estate, with 76 tenants initially, was officially opened by King George VI in 1939. Today Team Valley has evolved beyond industry alone and includes offices, retail, hospitality and leisure.

More than 700 businesses occupy more than 7.5m sq ft of property. More than 20,000 people – against an original goal of up to 40,000 – are employed there.

Recent newcomers include Morrison, a social housing repairs and maintenance provider. The company whose director is Neil Dixon has relocated from Birtley and Blaydon to open Merlin House as a regional centre.

Among premises recently become available is a former Del Monte banana ripening warehouse. The property has been marketed for optional uses.

UK Land Estates, which has owned and developed commercial property on the site for over two decades now, and is itself situated there, has with Gateshead Council been holding celebratory events. You can sign up for Team Valley e-news by e-mailing Lisa@ uk-land-estates.co.uk. www.team-valley.com

venues. It will also continue to be promoted to holidaymakers and tour operators.

Its 50 bedrooms are upgraded and free Wi-Fi is provided in public areas. General manager Ian Sinclair says: “This long established landmark is entering a new, exciting phase.” www.parkhoteltynemouth.co.uk

>> Rainton attraction One of the country’s largest legal service providers, recently acquired by an American company, has moved to Goodman’s Rainton Bridge Business Park, near Houghton le Spring.

UK Independent Medical Services Ltd has more than 13,000sq ft of offices on a 10-year lease, at an initial rent of £13psf.

Environmental move: Aquilo has gone to Teesside Industrial Estate

>> Gone Court-ing Aquilo Environmental has bought 87 Willows Court on Teesside Industrial Estate. The 7,852sq ft of offices and warehousing on two floors will house environmental and waste management specialists, with their equipment.

Sanderson Weatherall led the sale, Crosthwaite Commercial acted for the buyer.

>> On the conference map Conference and banquet facilities for 1,800 delegates and guests are a major selling point now of the landmark Park Hotel at Tynemouth, which has had a £1.5m refurbishment under new owners.

Montagu Hotels Group says the seaview hotel with 1930s Art Deco exterior is to be marketed as one of the region’s most accommodating business and events

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>> Dome attracts investors The Malhotra family firm DAV Developments, led by brothers Meenu and Bunty Malhotra, are reportedly investing £15m in regeneration of the Spanish City, a Whitley Bay landmark, despite the passing of its heyday as a holidaymakers’ haunt.

Scottish developer Robertson has its North East arm overhauling the rundown site at a cost of £23m. The famous Dome will >>

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COMMERCIAL PROPERTY

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>> Out of town move Collectables has opened an out-of-town giftware and fashion accessories store and coffee shop with a relocation from Northumberland Street, Newcastle, to St James’s Retail Park at Stamfordham Road in the city.

Managing director David Lewis (left, with his father Philip) says: “We have proved at Gateshead and Teesside that the Collectables brand performs best in out-of-town locations.”

It had traded 12 years on Northumberland Street. Collectables was begun by Philip and David Lewis at the Metrocentre in 1986. Last year’s turnover, at £12m, was slightly up.

house a leisure area. A boutique hotel, houses and apartments are also planned, a care home and perhaps an art gallery.

The Malhotras, whose DAV Developments is based in Parrish’s former department store building at Byker, have invested heavily in care homes throughout Tyne and Wear, as well as pubs such as Newcastle’s famous Balmbra’s in Cloth Market, the Three Mile Inn at Gosforth, and in Grey Street where the company is planning a boutique hotel.

>> A bit of character Two neighbouring buildings, Grade II listed, are up for sale on Westgate Road in Newcastle, Neville Hall and Bolbec Hall. The Gothic-styled Neville Hall, built in 1871, is owned by the Freemasons.

The baroque-styled Bolbec Hall, owned by the Literary and Philosophical Society which separates the two, was built 100 years ago. The society hopes to raise £1.5m from a sale to improve its own building.

>> Park changes hands Fund manager Highcross has acquired one of the North East’s earliest technology parks, Belasis Hall in Billingham. The Berkshire firm paid St Georges Securities £10m for it.

The 62-acre park, built in the late 1980s, is 95% occupied. It has 44 offices, laboratories and other buildings.

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building in central London. Director Cathy Rouse says Qubic continues to work with MH Legal, the North East solicitors.

>> Last orders, orders Two former council headquarters in Tyne Valley are open to offers. The Grade II-listed former town hall at Newburn is being offered freehold through Newcastle City Council for office or residential use. And Prospect House, the former home of Hexham Town Council is being valued at around £1m. Council reorganisations are behind the sales.

>> Hotel goes ahead A new hotel at Newcastle Airport whose future was in jeopardy even before it opened, is now part of the Hilton Worldwide chain. A franchise has been agreed with Cairn Hotel Group for a DoubleTree hotel at the recently-acquired site.

It is due to open in the autumn with 179 guest rooms, 11 conference rooms and business and fitness centres. The Cairn Group, whose own hotels include the Royal Station and Holiday Inns in Newcastle as well as Scotch Corner near Darlington, took over the troubled airport hotel in a £25m deal.

Behind the project originally was Tyneside entrepreneur Joe Robertson whose ambitions were thwarted when two offshore businesses collapsed.

• Jurys Inn is opening its new 203-bedroom hotel at Baltic Quays, Gateshead, in August. It has a “green” roof of living plants that look attractive, improve thermal insulation, and reduce flood risk.

• The 98 bedroom, six-storey Sleeperz Hotel on Westgate Road, in Newcastle, is due to open in time for Christmas trading.

>> Gherkin again Newcastle based accountants Qubic have followed the example of Newcastle law firm Watson Burton and opened an office in the prestigious Gherkin

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Morpeth rant: More shops have opened in Sanderson Arcade

>> Expanding arcade New shops are trading in the recently completed second phase of the £3.5m Sanderson Arcade in Morpeth. Fifty more jobs have come in with them.

Local contractor Mansell did the work for Dransfield Properties, which says the final unit in this phase will be occupied by a bar and restaurant soon.

>> Goodbye to Focus An £11m deal to turn four acres previously occupied by Focus DIY into a six-unit retail park at Bishop Auckland has been agreed by Metric Property Investments of London.

>> Speculation rewarded Enquiries are growing for Durham developer Ravensworth’s £7m speculative build of five industrial units at Portobello Road Industrial Estate beside the A1 at Birtley.

g n i in a em e 1 r its has n 3 U in P

in association with

Putting the Sun into Sunderland The Issue: How can we encourage further private sector growth in Sunderland?

Dave Smith: We have plenty of analysis on Sunderland’s challenges and issues, plenty around the city and the North East. We’ve myriad government policies around a number of things, but a stark lack of regional economic policy, particularly to support the development of the private sector in reviving the North’s economies. We are challenged to be creative about addressing our own needs in so far as we influence our futures in supporting the private sector. The council must play its part. But the ideas will come from thought leadership and practical slog by current investors in businesses of the city, and investors we wish to attract. We have established an economic leadership board which is at the heart of that thinking and helping us to deliver. We want to involve others who might bring different perspectives, different issues and different solutions.

Paul McEldon: Our not-for-profit enterprise has been doing business start-ups and business innovation for 17 years. We help up

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to 300 Sunderland residents every year to set up a business. We are a mini-barometer of what goes on in Sunderland. There are 1,000 people working in businesses on our site. We listen to their issues, try to help them grow. It’s like trying to build a football team – invest in youth. The challenge is to get them to think outside Sunderland. That requires lots of effort. You have to try to convince them to stay too. Or you go out and try to buy something already there – inward investment – but competition for that is worldwide. Then you have your regular squad whose skills you try to improve and in whom you try to engender team spirit. I feel Sunderland and many others sometimes just miss that potential in the middle. I don’t know who the top 25 or 50 growth businesses in Sunderland outside Doxford Park are. But they are the ones we should try to get behind.

Gary Hutchinson (who started as a waiter in his 12 years with Sunderland AFC and is now head of venue and events): What we have achieved with concerts at the Stadium of Light has brought in about £40m of economic benefit. We are now a player on the concert circuit. We proved a market after promoters wouldn’t touch us. We sold the venue from the city in partnership with the council and

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The participants Dave Smith, chief executive, Sunderland City Council Janet Johnson, deputy chief executive, Sunderland City Council Cllr Paul Watson, leader, Sunderland City Council Deborah Lewin, director, corporate affairs, Sunderland City Council Thomas Hurst, chief investment officer, Sunderland City Council Prof Peter Fidler, vice-chancellor, University of Sunderland Margaret Elliot, director of care services, Sunderland Home Care Associates Gary Hutchinson, head of venue and events, Sunderland Football Club Iain Hasdell, UK head, local and regional government, KPMG Bernie Callaghan, chief executive, Software City Ralph Saelzer, managing director, Liebherr Sunderland Works Ltd Paul McEldon, chief executive, Sunderland BIC Ian Baggett, managing director, Adderstone Group Paul Woolston, senior partner, PwC In the chair: Caroline Theobald, The Bridge Club Venue: Washington Old Hall BQ is highly regarded as a leading independent commentator on business issues, many of which have a bearing on the current and future success of the region’s business economy. BQ Live is a series of informative debates designed to further contribute to the success and prosperity of our regional economy through the debate, discussion and feedback of a range of key business topics and issues.

more than 200 businesses – from NGI to Nexus. We’ve shown we can produce something that wasn’t in Sunderland before.

On the council of the North East Chamber of Commerce I act as a conduit for 400 members from this city. We build on the regional view and regional contacts there and are involved in tourism. Hopefully through this conduit we can engage the private sector even more. We also have around 20 companies that meet like this and want to make the city better. We have a lot of modesty in this city. When we do have an endgame in view we’re very good. There is a will to work together.

Ian Baggett (whose company has developed

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a business park on the site of West Quay shipyard): On my development I’m proud that more than 500 people are working already in 36 businesses. More than 20 are new to Sunderland. We brought them in. We have planning permission for further development.

We think ours may be the first new business park in Sunderland for nearly two decades but no-one seems to have heard about it. We have had no council feedback, not even a pat on the back. Yet we did this with no gap funding – I detest no-one more than scroungers who will do nothing without gap funding. We may want to look at that tonight. I have made a small profit on a scheme built perhaps not in a most desirable area of Sunderland during a period that could not have been more difficult.

My biggest problem as a SME has been public sector intervention in the marketplace. I lose tenants to subsidised space. What incentive exists for the private sector? (He was told businesses had, in fact, been referred to his company).

Paul Watson: The council cares about safeguarding children and protecting social services. Without money we can’t do that. So prosperity comes high on our list. If a place is prosperous, about 90% of its problems will resolve themselves and only a light touch is then needed. Public sector and private sector are not homogenous masses. Private sector varies in its need of help. Ralph’s cranes, for example, have needs much different from Bernie’s software centres and Gary’s football

club. Sunderland people are too modest. A nationwide Post Office survey of business start-ups has shown Sunderland far in front.

What Paul says is true, and it reflects on what the BIC is doing. It has led to the Financial Times describing Sunderland as Britain’s start-up capital. So it’s important we know how things work, and they work very differently in different sectors. We need to create environments for success. That’s probably the council’s job. We have to understand what they need to succeed. We need to be open to suggestion, receptive about how to get scarce resources out to high-growth businesses. The council now is looking at £50m of cuts and fewer resources – another £23m of cuts next year. Business rates will be relocalised. But there’s no gap funding. We need a model showing how to do things without that. Business probably knows what it needs for success. Everybody here wants Sunderland to prosper. Councils don’t always get it right, so let’s make a new start from tonight.

Paul Woolston (whose many affiliations with Sunderland include having been born there): I think the council does a good job. Businesses do find Sunderland good to do business with, compared to other councils. I also think you must be realistic about how much a council can do. There may be some aspects of council business better done now by the private sector. But I think the council is open to all of that. I’d like to see Sunderland make the most

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of its assets – the beach, the port, the heritage – lots can be made out of that. The council can provide top-class education, encourage top-class housing, particularly executive housing. There are city centre issues, particularly the Vaux site. You feel your nose is being rubbed in it when you walk past that.

We don’t recognise always what is being achieved in business. Maybe we should get behind that. I think, too, Sunderland needs more bridges. And how easy would it be for us to get businesses here to pay for a piece of public art? Getting businesses working like that to me would be a sign of success.

Peter Fidler (who came to the North East 12 years ago having lived in every other English region): The university is one of a generation of new universities created 20 years ago next year, the same year Sunderland became a city.

About six years ago we concluded our vision was to become one of this new generation of great universities that could call themselves again great civic universities. The closeness of our relationship with our city, our infrastructure and people of the city and the North East meant we were looking at a model similar to that which Manchester, Sheffield and Glasgow formulated when Oxford and Cambridge didn’t cut it for them. The industrial transformation of the Victorian period would not have been possible had Oxford and Cambridge been the only places that could educate. They decided to invent their own universities. The great >>

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industrialists effectively funded those through endowments. We use that metaphor as the basis for our future which is strictly linked to this city and this region, its economic and cultural development, and social aspects. I think anyone judging us would say we have made huge strides in that respect. We’re now a £120m turnover university. We’re not public sector; some say we’re not private sector.

We’re something of a bridge. We are heavily regulated and increasingly losing funding.

There’s a correlation between withdrawal of funding and increase in regulation, so we’re looking at the utility industries’ models. That £120m turnover probably has a two-and-ahalf times multiplier effect in the city and the region. We have one of the largest proportions of services supplied by businesses in this region of any university. We try to use city and regional suppliers. About 70% of our students are from this region. We also have students not in the city but in regional colleges, in foundation programmes, and internationally.

We have students on our programmes at five universities in Vietnam doing banking and finance. We were the first university licensed to operate in Vietnam. With partners we have the only pharmaceutical society programme accredited in Malaysia: 41% of all our student enrolments are what we call transnational.

They’re not in Sunderland but studying with partners elsewhere in the world. There’s a

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huge diaspora, with huge connections, fondness and loyalty to the city all over. I attended graduations recently in Kuala Lumpur, Penang and Hanoi. Those students have DVDs of our city. They have DVDs showing their year when they came for a top-up. They wear red and white shirts. There’s a huge capacity to draw on all that. At the graduation dinner in Hanoi I discovered a young woman sitting on my right was a graduate of our university. She had never been to our university but graduated in the National University of Vietnam on a Sunderland banking and business programme. She was enthralled with the university and what the city was like. Her job was in the South Korean Embassy in Hanoi as the new diplomatic attaché for education. We immediately have a line to the Korean economy. This all links to the business agenda. We’ve promoted over the last five years emphasis on enterprise and initiative with our students and have supported initiatives which are growing new businesses in the city. We have a business hatchery, a software hatchery and a hatchery for creative businesses. We’ve worked closely with BIC and established the Blueprint Awards.

We’ve had huge success and are only touching effectively a handful of all those there. There are many, many more students interested who could not only grow their own business but go to a private business environment and be a

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catalyst, generating new things within. We want to do a lot of that. Things are made difficult by the Government telling students they must pay fees twice as much as before. In this region and demography it’s a big thing to ask. They are also deciding the overseas student export market should now be part of immigration controls. They have sent messages round the world saying this country does not now wish to attract Indian and Chinese students because they might abscond and stay in this country – and start a new business. No doubt they are interested in becoming economic migrants. Shouldn’t our region welcome that? But we say no, you can’t, because you’ll take our jobs. Yet we want to grow an enterprise culture.

Bernie Callaghan: UKTI has effectively been centralised. You used to be able to rely on its good offices to direct people towards our cities. Not now. They are sent to London and the M4 corridor. They don’t look at the regions. In software, if you go onto UKTI website, the front page says software companies interested in the UK should go to Tech City in London. Nothing about anywhere else. It’s an initiative the Government has chucked tens of millions of pounds at over a year. That is public intervention centrally, to the exclusion of everywhere else. I help software businesses, invest in them, and try to encourage people to start software businesses.

Software is an international entity. We have to be good at it. Some companies find themselves trading internationally before they are trading domestically. We are not only not getting help – we are getting obstacles and hurdles. That to me is a big issue.

Thomas Hurst: I went with Dave Smith to Nissan in Japan to lobby for the electric vehicle and the electric battery plant. A trade mission of nine software businesses also went to Washington DC and Seattle and put in a lot of work. Every company had a product not available in America. Later David Cameron made a speech in Darlington slagging off Sunderland City Council for spending £22,000 on the DC trade mission that the companies had contributed to. It’s OK for London to spend loads of public money promoting Tech City though. Everyone on the Sunderland mission had thought it wonderful. Some

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UKTI has effectively been centralised.

You used to be able to rely on its good offices to direct people towards our cities. Not now. They are sent to London and the M4 corridor. They don’t look at the regions

companies wrote to the Prime Minister about this without us even knowing. In the last couple of weeks invitations have been coming to meet with high-ups in Washington. Two businesses we took are now opening offices there. One has opened in DC and one has opened in Chicago. Two other companies are thinking about doing it. The more business they get in America the more jobs will be created in Sunderland.

[The delegates were also told of a foreign company that recently wanted to locate somewhere in the UK. In the absence of funding, UKTI was asked for help, not with finance but with contact names. Allegedly, there was no response.)

You must compete with the rest of the world now for inward investment. You’ve got to drop the arrogance of believing people will come here because they speak the same language – the only advantage we have.

Labour is probably relatively easy to find anywhere. If I was a company coming into this country now I’d be guaranteed a better reception from Wales or Scotland than from England. Scotland and Wales have freedom to do what they want. In the English regions you’re tied by rules all the time.

Ralph Saelzer: We bought our Sunderland site in 1988. Why haven’t we developed further? The cranes we produce are RollsRoyces of their kind. Every fifth ship has a

crane made in Sunderland. The company decided at one point to build a new plant but sited it in Germany. We couldn’t find the skilled workforce in Sunderland and couldn’t at that point set up an apprentice scheme. It was sabotaged by the then government over the way courses had to be set up. What we tried to do through colleges was a disaster.

Only later did the government have a change of mind. Now we have a very successful scheme. What will attract business here?

Skilled people. There is not only an academic way to a career. You can also do things with your hands for the economy. Also, out of all our subcontracted goods and services only 13% can be sourced in the UK. Out of 25 major suppliers, only two are from the UK, one being the energy supplier. The goods are there – the quality isn’t. Delivery times won’t be met. Prices are too high – we don’t buy steel from Corus because German steel is cheaper, but we shall remain in Sunderland and still invest heavily in goods – on average about £1m a year, and in training and education around several hundred thousands. There’s a future here, absolutely.

Margaret Elliot: Sunderland Home Care Associates is third sector, social enterprise.

That doesn’t mean grants. We get nothing from anyone. We tender for everything like other businesses, and have to be sustainable and viable. My roots go back to the Cooperative Movement in the 1970s. Me and my friends looked after our little bairns in a room over a shop, otherwise we wouldn’t have been able to work. That was a powerful tool. I knew it could change lives. We now employ about 360 people but, having replicated, employ many more. When a single mother comes to us with maybe two or three bairns, no qualifications and living on benefits, they start

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to get trained. When they start earning a few bob I see the change. They come to meetings, participate, have a vote and a say in running the company. It changes people’s lives. I’ve been doing this for 36 years. Sunderland Home Care is 17 years old. Years ago our directors, elected by members of the company, decided to show that employee ownership wasn’t leather sandals and lentils. We are viable and have to make a profit, and we plough that back into the business. If a person from perhaps Pennywell or Southwick can come in, start training and feel better about themselves, have shares and a stake in the company, it’s a big thing for them. We explained to the university how we had all these trained carers, fantastic people. ‘You’ve got disabled students who need support,’ we said. We built up that side of the business. We supply academic support. We went to colleges and explained how we had good, trained mentors. Now we supply mentors to the colleges, looking after their students with disabilities. We have a cafe to supply five tower blocks. We bring in students with learning disabilities to gain work experience.

We set up a company called Care and Share Associates. We have now replicated in Newcastle, North and South Tyneside, Manchester, Calderdale and Moorsley and now we are moving on to Leeds. While it’s great to have Nissans of this world there are not many about. But there are a lot of people who need encouragement to set up on their own. A lot of people on council estates have lots of promise and ideas. Let’s look at that side too.

Deborah Lewin: My job is to make Sunderland relevant to people. We’ve been trying to have conversations at government level and, over the past year, we’ve had a >>

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100% increase in enquiries from national media about Sunderland. Two years ago we never had a phonecall from Radio 4. It felt like we were on another planet. We have to work a hundred times as hard, I believe, on authorities in London and the South East to get our voice heard. That doesn’t mean we shouldn’t try. We are now going out and telling people what we do, but more importantly asking them what are the issues that need debating. Is there a vacuum and can we fill it by increasing our relevance to people on issues of economy, business, social enterprise or community leadership? Although we have had 100% uplift in interest from the media, the opinion formers and influencers, come national conferences and the need for a council chief executive or council leader to comment, they still use predominantly someone from London. We niggle away at this. When we do tell people what we do they can’t believe it. Then they want to know more.

Then they spread the word about what we are doing, so we get phonecalls from other people. We are doing lots of very important things in Sunderland. There are about six key issues. And when unhelpful things are said we challenge them. When the Prime Minister made the comment he did we sent a note remarking on his unhelpful comments. You have to get the politics right to get the

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economics right.

Iain Hasdell (specialist in sub-regional and regional economic growth issues, in cities across the UK and Europe): I see opportunities for Sunderland. Within an area which has such a wide proportion of public sector employment – no-one’s fault, that – there is a lot of private equity and other finance flooding into the public sector, not just councils. As public bodies divest themselves of services, the North East is slowest in all the UK to recognise there is an opportunity for mobile capital and external investment to come in, and for the public sector to create new businesses. It’s a good opportunity also to protect jobs. Can Sunderland get much more active in public-private partnerships? Evidence from mainland Europe is that cities grow when infrastructure is fantastic. Sunderland Council sits on large quantities of land and has property and other assets, but there is an issue about getting to market quickly and using those assets for new infrastructure which then drives economic growth. Sunderland has an infrastructure deficit though some fantastic work has gone on over five or six years. The public sector can best fund that further. Also, goods and services the public sector buys play a big part in Sunderland’s GDP. Everybody who spends a public pound should ask: ‘How can I spend this in a way that contributes to the

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local economy?’ – instead of asking how to spend it to deliver a service or something else.

Pulling that trick off would take you far.

Applied to a City Council spend of £250m it would make a big, big difference, even if only applied to every other pound.

Janet Johnson: An investment in a quality infrastructure leads to a quality of opportunity and aspiration. But there has to be an end game to explain why you are developing particular forms of infrastructure. In the city centre the key driver has to be thousands of quality jobs and the building of a diverse evening economy to encourage people to spend their leisure time there. The city centre is a key priority of the city’s Economic Master Plan, and the biggest project is developing the Vaux site with the aim of developing a Doxford Park in the centre of Sunderland. If we had that employing up to 7,000 people in the city centre an even higher quality of shopping would follow. I’d love the private sector to help develop it without any council intervention. I have spent my career in the North East and have found few parts able, even in the best times economically, to have a property sector that can thrive without some form of intervention. But I’d be happy to discuss this more.

Ian Baggett: I have dealt with local authorities all over the North East. Sunderland is one of the more positive. In the last few years it has been acknowledged we’re all in it together.

Previously that wasn’t so. Don’t take this the wrong way but I’d like to have seen a couple of people from the council here and 12 people from business because they are the ones with ideas and answers. Brims is a Sunderland based construction business employing 60 people and turning over many millions, yet it struggles to get through the stage of a pre-qualifying questionnaire (PQQ), and has never done work for the council or the university. Yet I think it is the city’s biggest contractor. Get it and maybe 10 other businesses to events like this. That could help them, albeit differently from some massive investment talked about. You’ll not attract tenants to the Vaux site if the private sector has to be competing with space enjoying public funding. I think also the city’s fabulous incubator facilities should be managed in >>

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ISSUE FOURTEEN: SUMMER 2011

SUNRISE IN SUNDERLAND The Live Debate argues the case for what the region’s

biggest city can offer – and game plans fill the schedule

HI DUBAI – HELLO NY? Emirates’ service to the Middle East has been extraordinarily successful, so would a direct link to the Big Apple succeed?

THE TRAIN NOW TAKING OFF

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COMING ALIVE AFTER FIVE Newcastle’s take on a 40-year-old city centre improvement ISSUE NINE: SUMMER 2011

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DEBATE

SUMMER 11

such a way that once a business is established there it should have to leave. Staff there do so good a job trying to maintain the businesses that the facilities skewer the marketplace.

Peter Fidler: Would the private sector invest in incubators?

Ian Baggett: Definitely.

Peter Fidler: Why hasn’t it then?

Ian Baggett: It doesn’t make it as much money...

Peter Fidler: Exactly. Why criticise the incubators? You are seeking to interject into that business model which actually starts with the objective of throwing them out of the nest by hatching and despatching. Our incubators look at how we can manage that exit sensibly.

Dave Smith: Ian has some important points about how less sophisticated we are about developing growth in the SME sector. I think we are much more sophisticated with the larger businesses and larger inward investment campaigns we have run over the years. For me some of the debate suggests lack of deep thought not to the start of businesses but to their subsequent growth. As the Royal Mail findings show, the question isn’t how we start businesses but how we grow them beyond lifestyle level. Our economy is weak because we don’t have a sufficiently strong and vibrant SME sector with business to business trade.

BUSINESS QUARTER | SUMMER 11

Get to institutional investors who are scouring the country with significant investment.

Let’s not see Sunderland one of the last to grab that opportunity.

If capital is one of the deficits, opportunity is there right now Large-scale manufacturing and exporting doesn’t bring the same level of stimulus within the economy other than through jobs themselves and consumerism. We haven’t considered our role in sustaining those businesses at SME level and growing them beyond. In that sense, I agree with Ian’s challenge. But I don’t think the answer lies in having a master public service and a serving private sector, then flipping that on its head.

While I disagree with that part of the Government’s policy that running down the public sector will stimulate the public sector – certainly not in the weak economies of the North of England – growth in the private sector has to be growth in the private sector.

The public sector needs to be seen as enabler to that. Nissan could walk tomorrow. So let’s not make mistakes made 30 or 40 years ago and have all our eggs in one basket. We must understand better ways how to grow and sustain the SME sector, and how to use the public sector as a partner to enable that.

Bernie Callaghan: For the SME sector there is virtually no private equity or investment structure in the North East. Banks aren’t lending helpfully. If you’re setting up a

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business the last thing you need to think about is where we are going to go. There’s always a site somewhere. But you always need money – and someone to sell to. Selling the city is difficult when we have a physical structure problem.

Ralph Saelzer: It is a matter of concern for us about what happens in the city centre.

Paul McEldon: The private as well as the public sector can do something about spending more within the city. Some tenants we have would like some discrimination around public sector contracts. When companies bid for public contracts and don’t get them can they be told why, so they can do something about it.

Dave Smith: We’ve doubled the number of contracts going to Sunderland within the last year. Our limit legally in that respect is £75,000. We also have to enable local companies to stand a good chance of winning the bigger contracts. Where smaller enterprises don’t stand a chance – in construction and things like that – we have encouraged businesses to work together, form alliances. Not enough businesses will engage with us on that.

Gary Hutchinson: It goes back to making it easy to do business. Sometimes I find it hard to understand the changing landscape and

SUMMER 11

how we can engage easier.

Ian Baggett: Trying to get to a public sector contract can be like swimming through treacle. You can fill in 200 PQQs and perhaps succeed with one.

Thomas Hurst: I agree if people are trying to do good for the city they need to be encouraged. We have to get a businessfriendly reception. It’s all to do with personal contact. Often you can’t do what you are being asked, but at least start from a point of encouragement. There’s a way to say no to people.

Ian Baggett: You have the multinationals and great work is done to bring them into Sunderland. You have the good reputation now for start-ups. But there is that gap in the middle. Promoting lifestyle businesses is great for employment generation if that’s as ambitious as you are. I would hope Sunderland could promote proper business.

Peter Fidler: Can we attack particular sectors?

We’ve put muscle behind software and it’s going somewhere. We have tried to grapple with renewables and offshore and the supply chain round Nissan. We talked in the Economic Master Plan about creative industries. There are other things where we are strong – pharmaceuticals and drug discovery – yet I think we have only Helena Biosciences in the city, nothing else.

Dave Smith: We aren’t going to get anywhere with key sectors unless we tackle them at the appropriate level. While we shall take our opportunities as they arise, our collective resources and the private sector resources are particularly limited in the current economic climate. Also limitations are placed on us by government policy or lack of it. So a clear focus is important. Because an argument was made about software, the council can continue with its development, having picked up funding lost from the RDA. Equally we have identified the importance of health and social care, particularly in the SME sector. We have to be targeted or we’ll spread our jam too thinly then achieve nothing. But we have to be punching for the SMEs at the same time as we support existing major businesses.

Paul Woolston: I don’t regard lifestyle business people as entrepreneurs.

Entrepreneurs want to develop big businesses.

If you can get a business with 100 people and make it 200 people that’s a big shift. You can understand why Margaret and Ralph here have been successful. Without good leaders you get nowhere.

Ralph Saelzer: I have learned from this debate that most of us have the same concerns – skills, finance and so on. To push the city is in all our interests.

Ian Hasdell: Many answers have to be home grown in the city. But we mustn’t ignore what makes successful cities. There are some key things every city has to do: the infrastructure deficit has to be addressed.

Dave Smith: It’s no good trying to support people whose only motive for setting up is that they don’t want to work for someone else.

Bernie Callaghan: Niall Quinn said one of the first things striking him when he first came to Sunderland was that no-one there seemed to know anything about Sunderland. Now we have a book that will be given to all Year 10 schoolchildren in the city.

Ralph Saelzer: We have not mentioned trade unions. They have the same aims. They want to drive the region and the growth of this city.

Chat with them. Bring them to the table.

Margaret Elliot: I think it’s really important we use the trade union movement and its

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DEBATE

power in what we do.

Ian Baggett: My experiences with local authorities in the North East is at a high level.

Normally there is a common agenda. But sometimes it is difficult for that agenda to filter down to people we work with day to day. Flexibility at a lower level would help massively.

Dave Smith: One of the things we shall take from here are the observations about tendering. We shall be as responsive and flexible as we can be. We should be big enough and brave enough to test that.

Ian Baggett: It would be helpful to consider how you can encourage an entrepreneurial spirit in a council.

Dave Smith: We have made changes in senior positions, bringing a whole new approach and understanding of the private sector. Deborah Lewis is from the private sector. We have a commercial director, not an old-style city treasurer. We are not just regulators, but we do still need to have a safe and secure organisation in handling public money. We’re also into enterprise, though. If you take nothing else away from this, be confident we are putting energy into this drive and taking notice of what you are telling us.

Naming the priorities Participants were asked their main priority towards advancing the private sector in Sunderland.

Paul McEldon: We have been working with the council and over 180 of its staff in three months. Fifteen have worked up good business plans for lifestyle businesses and the first four have just set off. They could generate more than £600,000 in turnover, saving the council £183,000 in salaries. That will also create role models. You don’t know which small businesses will become big ones.

Sometimes you just have to go with it. And the social impact of someone setting up a lifestyle business on some estates of Sunderland is phenomenal. It stimulates the next generation, which may create the big, big business. My measure of success would be 150 businesses coming forward from Sunderland for such support as the Government is offering.

Bernie Callaghan: I want to see enterprise >>

BUSINESS QUARTER | SUMMER 11

DEBATE

SUMMER 11

If I was a company coming into this country now I’d be guaranteed a better reception from Wales or Scotland than from England. Scotland and Wales have freedom to do what they want. In the English regions you’re tied by rules all the time education. Something called Start-up Britain was held in Carnaby Street, full of what you would expect there. I felt annoyance at the arrogance of people working in London.

I also felt: ‘Let’s show them. We can do it just as good, if not better.’

Ian Hasdell: Get to institutional investors who are scouring the country with significant investment. Let’s not see Sunderland one of the last to grab that opportunity. If capital is one of the deficits, opportunity is there right now.

Dave Smith: Confidence among our young people and confidence in the public sector to champion and develop Sunderland.

Margaret Elliot: Co-production – council and businesses working together in equal partnership.

BUSINESS QUARTER | SUMMER 11

Janet Johnson: Shared commitment to Sunderland. Everyone here has their own version of an interesting and worthwhile development role for improving Sunderland.

Everyone here has good contacts, good networks they use for their own business. If we could use them also, ultimately it would benefit Sunderland. Could we also sign a commitment that strives in a particular direction? I wonder if the corporate social responsibility we see in the private sector cannot also be offered to improve Sunderland, because that is corporate responsibility to me.

Peter Fidler: I am particularly concerned about 19 to 21-year-olds wanting to develop and stay here. This tap could be turned off under present uncertainties. If we don’t have graduate jobs on the same level as the rest of

50

the country there will be a disincentive for our community and those looking to come here to come and do it. In many vocations they feel they must look to the South East at the moment. So one project I would love help on is to develop possibly a social enterprise, an intern factory – a business for graduates immediately on leaving with their degrees when there isn’t a receptive world at the minute in job terms. They could take in slatefuls of problems, ideas and jobs from all the other companies in the city and deploy brain power on them, so we create a company for 150 people in the first instance.

Ralph Saelzer: My priority is providing skills and foundations without which you cannot achieve the goal.

Thomas Hurst: In terms of the Master Plan it doesn’t look as if some things are happening.

We have met companies from Switzerland, Korea and China, Germany and France over wind farm development. We have some very serious enquiries. Nissan hold us in highest regard. We have to ensure that anyone wishing to do business with Sunderland will get the same treatment Nissan does.

Paul Woolston: My priority – link private equity to small growing businesses.

Ian Hasdell: I would like to see success and ambition promoted and celebrated more in Sunderland. Everyone is ambitious for the football team yet blind to the successes in other things.

Gary Hutchinson: We have to get the Master Plan’s aims across to everyone. We must make it easy to do business, get across the enthusiasm that is here, and remember we are all in the city to do business and do business with each other too.

Paul Watson: Ask someone in a rut with a successful little lifestyle business – a newsagent’s or fish and chip shop, for example – whether they would go to a bank for a loan at a usury rate and just branch out. It’s not going to happen. But we can do what you are talking about. We’re going to see a massive restructuring in how public money is given. It will be much less money. But it will be a fantastic opportunity for us to hold the reins as the determinants. We need to take points made tonight into our council, and make them happen. n

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ENTREPRENEUR

SUMMER 11

Turning over a new Leaf The North East’s foremost family firm is reinforcing its pledge to care for customers.

Brian Nicholls asks Nigel McMinn, managing director of Benfield Motor Group, why BUSINESS QUARTER | SUMMER 11

52

Though a region with lower than average car ownership, the North East excels at selling and servicing cars. An earlier generation of paragons in this included Sir Peter Vardy and Sir Tom Cowie.

Today it’s Robert Forrester at Vertu and also the Squires family firm which, of course, has excelled throughout – ever since their business, now Benfield, first opened a tiny garage at Addison Road in Newcastle’s then “working class” Byker district, back in 1957.

Sir Tom’s T Cowie, once sold, evolved into Arriva, today’s German owned pan-European public transport giant, while Sir Peter’s Vardy has been absorbed by Pendragon which claims to be market leader. Two of Sir Peter’s former lieutenants, however, Forrester and Nigel McMinn, carry the banners of leadership in the region today.

The Journal newspaper’s new listing of the North East Top 200 companies shows Vertu, the country’s ninth biggest operation, with Forrester chief executive already the region’s sixth biggest business (and in business only since 2006), a spot Vardy often used to occupy. Addison Motors (alias Benfield) at 17th is distinguished as the region’s foremost private company, with McMinn its managing director.

Is a new Benfield marketing strategy, focused on customer service experience, a bid to steal a march? Not at all, says McMinn.

“Robert Forrester is a personal friend. Apart from us both having worked at Vardy he has just moved into a new home about 50 yards away from me on the same Gosforth street.”

No question of any neighbourly dispute of leylandi proportions, then?

“One of the great things about the motor industry,” McMinn explains patiently, “is that dealers have great camaraderie. We don’t see each other as arch rivals or big competitors.

We approach the job very differently but have respect for each other.

“Success can be achieved in different ways.

Robert has very much a national strategy, which obviously is very different to us. But I am sure it can be as effective. So they tend to have a different culture, market themselves differently, as you would expect of a national group. We get on very well.

“While they are based in Gateshead, they only

SUMMER 11

ENTREPRENEUR

It would be a misinterpretation that we claim to deliver world class service all the time. We say we aspire to that

have a handful of dealerships in the North East. They are a big national player but not a big North East player. If they had the same amount of dealerships as we have in the North East we would clash as head-on competitors more. We don’t do that very often.”

Benfield has long contained its empire to within two-and-a-half hours’ drive of Newcastle. So while AIM-listed Vertu reaches from Dunfermline to Exeter, privately owned Benfield focuses its 30 dealerships, 11 brands and several backshop businesses between Wakefield and Dumfries.

Its new TV marketing approach is the support, not the vanguard, in an overhauled customer service.

“This brand marketing,” McMinn explains, “comes about a year after we started a big cultural programme internally.

“So already in our Be Benfield culture change every staff member has been on a course to consider customer service, and on one of customer standards training. We have developed probably the fullest set of customer service standards any motor retailers have ever developed themselves. We see a three- to five-year journey to delivery of the sort of world-class service we would like to deliver.”

This involves a wider intake of apprentices.

Benfield has always had service and parts apprentices, and now has a female apprentice in car body repair and painting. Sarah Shaw, 19, from Newbiggin Hall, Newcastle, is at the same time working up her NVQs in Gateshead College. Benfield is determined to counter an official statistic of women being 10 times less likely than men to work in skilled trades such as the motor industry and mechanical engineering.

However, Benfield has also taken on sales apprentices; 18 males and females.

“There isn’t a sales apprenticeship course,” McMinn says. “So we developed our own four-year programme. Those apprentices are working in our dealerships and going through the basic customer service training the North East Chamber of Commerce gives. We supplement that with our own sales development training.”

Adaptable people unversed in car selling are being recruited.

“You must have an aspiration in all this culture change,” says McMinn. “It would be a misinterpretation that we claim to deliver world-class service all the time. We say we aspire to that.”

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The firm’s television spots accordingly are a little like the manufacturers’ long-projected fantasy concepts – the sleek, shiny car snaking through the Alps. But McMinn, 42, explains: “Part of that is to remind motorists of emotions they have felt if they have ever driven through the Alps – or even the Lake District as we set it in.

“More, however, we are reminding viewers of car journeys they took earlier that were significant to them – bringing a new baby home from hospital, dropping a child at university all packed up with their belongings.

“We are saying: ‘We want to prove we know what it’s like to be a customer because we are customers too. The car is so important to you on those journeys you can’t afford a breakdown en route. And for us it’s important for you to feel that if something like that should happen you will feel you have a number you can ring with someone there who is going to try to solve your problem.’”

What about performance of the goods? Many motor-obsessives may not want screen romanticism but knowledge about what a car will do.

McMinn’s reply is unhesitating. “The guy only interested in performance still wants to know that if something goes wrong with the car he buys the dealer will be behind him to look after that.

“Through the internet, all customers can get detailed information at their fingertips, 24 hours a day. We provide that information on our own website. Thousands of other websites do that job too. A TV ad gives 30 seconds.

There is no way in that time you can push all the information out.

“The internet also makes quality of service transparent. Just as hotel service is ranked, you will see on the first page of every BMW dealer’s site, for example, a rating of up to five stars for sales and service. We realised some years ago our service was going to be publicised all over the internet. If you don’t take that seriously you will be caught out.”

Benfield, which employs 1,200 people, has done “excellently” through the Scrappage scheme.

McMinn says: “We represent mostly volume brands and they benefited mainly when people brought in old cars to replace.” >>

BUSINESS QUARTER | SUMMER 11

ENTREPRENEUR Now Scrappage has ended, how do you persuade motorists not to hang on to their vehicles?

McMinn replies: “For about a year we have not had Scrappage, but we find as the economy recovers that retail demand is picking up the slack. It was good temporary help when most needed. Underlying retail demand is now stronger. Our fleet volumes also have been growing fast for two years. This suggests firms are replacing company cars and employing people again. How do we persuade a customer it is worth changing their car?

“When fuel prices hit 148p a litre and they are already seeing rising food prices, rising electricity prices and other higher costs, a natural reaction is to put off spending on a new car. It tends to be seen as a big capital purchase and unnecessary. “‘Maybe not just now,’ people think. But we prove to them that what they are running is a car low on miles per gallon, with expensive road tax, probably about to cost money to get it through its MoT. And it is going to be out of warranty. “‘Now is exactly the time to be changing,’ we say. You could be paying the same monthly finance payments but with much reduced road tax, much reduced fuel bills and obviously covered under warranty and cheaper servicing.

It’s cheaper to change.”

Benfield’s optimism is also driven by Nissan’s decision to have one of its first partners to sell the electric, zero emission Leaf.

“Electric motoring will infiltrate all manufacturers in time,” says McMinn. “We are ambassadors for the Leaf so I suppose I speak from a slightly biased viewpoint.”

He, chief executive Mark Squires, and other members of management already run them as everyday vehicles. He praises its roominess, its fittings and adds: “It drives really well and is as quick as a two-and-a-half litre V6 off the mark. It also has zero road tax and zero fuel duty because there is no fuel to buy. For a company car user it is totally free.”

Doubters question price vis a vis a conventional vehicle. McMinn says: “Depending on mileage, it can be very affordable – about £400 a month. If you are saving £200 or £300 a month on fuel and you have zero road tax it’s pretty compelling, isn’t

BUSINESS QUARTER | SUMMER 11

SUMMER 11

it? On 18,000 miles a year you find the car paying for itself. Fuel saving would equate to a monthly lease payment.”

He agrees the 100-mile maximum distance may dissuade some for whom frequent runs of 100 miles-plus are necessary.

“But many people will buy the car as part of their job or as a second vehicle,” he says.

Also he is confident that technology will trumph. “Range extenders are already being installed in some lorries. For now you need a

Family champion Nigel McMinn, who joined Benfield fourand-a-half years ago, is the first non-Squires to be managing director, the title once of present chairman John Squires. John (background, also accountancy), had joined his father five years after start-up, became managing director two years later and set a pattern for today’s success of the company equating to £313m in turnover.

Chief executive Mark Squires, a champion of family business in his chairmanship of the North East Institute for Family Business, believes family firms like theirs are well placed for recovery, given their financial prudence and strong sense of customer loyalty.

McMinn – from Lytham St Anns – attended university at Edinburgh, worked in Newcastle for PwC and held an accountancy post in Darlington. Though a qualified chartered accountant also, he hankered for the frontline of business. He had a decade with Vardy in the North East and Edinburgh before joining Benfield.

big enough vehicle to take the cassette as the technology has not been adopted for a car yet. But the manufacturers are only just warming up on this.”

McMinn cites Tesla Motors, the niche manufacturer that Silicon Valley engineers set up in 2003 to prove a future for electric motoring. Tesla has already proved a 300-mile range possible. He believes that range will be

54

widespread in the next three to five years.

“Look how mobile phones and computers have developed and become many times more powerful,” McMinn suggests. “Apply that sort of thinking to something as simple as a battery and you know things will leap forward.”

Despite the present limitation, demand already exceeds supply. Benfield had taken 50 orders even before a Leaf floated onto North East streets. It got a delivery of about three dozen Japanese versions and soon found homes for them.

“There was also a cancelled order somewhere in the country for 17 white ones,” says McMinn. “We took those and sold them too.

I think we are now quoting early 2012 to get one.”

They will be built in Sunderland from 2013, but until then 2,000 a year are coming in from Japan this year and next.

McMinn says: “Companies want to be seen to be green and doing their bit for the environment, so some companies are already using them as pool cars.”

With this argosy in sight, yet some other firms’ showrooms distressed still, is Benfield hungry for acquisition?

McMinn replies: “Our growth plans are based around the right opportunity with the right franchise in the right geography. We consider ourselves regional dealers. Our knowledge of the market is around the North East, Yorkshire, Cumbria and the South of Scotland. Our view is that we should stick to what we know.

“There will be lots of opportunities with prestige franchises where we would like to be.

We get offered quite a lot and we turn down a lot because they don’t fit our criteria.”

While Tyneside and Northumberland might be considered satisfactorily covered, Benfield sees opportunity in Yorkshire maybe, given its size, on Wearside where it has no presence, and on Teesside where it has three dealerships. It might even return to Edinburgh, which it left earlier to gain size in the North East under a reorganisation of dealerships. “Edinburgh is a market we all know and would gladly go back to,” McMinn says with feeling. He was a regional director for East Scotland there.

Edinburgh would fulfil the two-and-a-half hour criterion. But could you still drive there non-stop in a Leaf? n

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ENTREPRENEUR

SUMMER 11

the Academy of hard Knocks Business bosses are enthusiastic about The Prince’s Trust and its ability to turn out young entrepreneurs and sound employees. Brian Nicholls reports on reviving aspiration and ambition Despite a paucity of funding available for external investment at the moment, many business bosses and their workforces are joining Cheryl Cole’s chorus line to ensure the North East’s Academy of Hard Knocks can continue to develop potential young entrepreneurs and talented employees.

The Academy of Hard Knocks – alias The Prince’s Trust – helps 4,000 young people a year in the North East to turn their previously disappointing lives around by equipping them

BUSINESS QUARTER | SUMMER 11

for work and sometimes self-employment.

Nearly 60% of businesses they start up are still running after three years.

A BQ check across different sectors indicates unreserved admiration for the trust in the region, not only in its reviving of young people’s aspirations but also in its contributing of skilled labour and entrepreneurial ambition in the workplace.

A number of the businesses are currently showing support by contesting a Million

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Makers enterprise challenge to raise £10,000 each for the youth charity.

Enthusiastic members of their staffs are vying over six months to see who can be top fundraiser.

It’s a challenge going on throughout the UK, with up to 100 teams going head-to-head to gross £1m. They know it will be money well spent because more than three in four young people helped by the trust move into work, training or education. And 84p out of every

SUMMER 11

pound the trust receives is spent directly on this.

The Million Makers challenge for the North East got under way when employees from seven firms met at an adventure park. The firms include Northumbrian Water, Benfield Motor Group, Tesco Bank, Dickinson Dees, Zodiac Training and HP. They are now injecting their business acumen, creativity and skill of negotiation into running mini enterprises that will raise the cash to help others find work.

The trust says there is still time for others to join them.

At executive level, a development committee of notable business names is working to coax financial support in other ways, and it is also hoped, following a recent meeting, to form a leadership committee to spur further corporate participation.

The trust already enjoys active support from well known business people, including David Meldrum (Meldrum Construction), John Holland (of food wholesaler JR Holland), John Marshall (senior partner, Dickinson Dees law firm), Nigel McMinn (Benfield), and John Wall (Proton Power Systems) who heads the development committee. David Simpson of Coutts is also on hand as an adviser.

Singing celeb Cheryl Cole has become a patron, having given already £48,000 raised

ENTREPRENEUR

The fact that funds raised in the North East are wholly devoted to helping young people in the North East is something that I think appeals from an online auction of fashions, and she also plans a concert in the North East next year to add to that. As donors can ask for funds to go to a certain type of training course or a specific geographic area, she has asked for young people of Heaton, Byker and Walker to be helped – areas of Newcastle where growing up was far from easy for her.

Benfield’s involvement has come about through a lunch conversation that chairman John Squires and managing director Nigel McMinn shared with fellow guests. Benfield has helped charities for more than 50 years, and does it now through its own Benfield Charitable Trust which supports numerous causes at home and abroad, from The Sage concert centre at Gateshead to beekeepers in Africa.

By giving 5% of its operating profits to its own charitable trust every year it can also help the likes of the North East Air Ambulance, Newburn Sea Cadets, St Oswald’s Hospice,

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and provide food for homeless people.

Its role in helping 14- to 30-year-olds via The Prince’s Trust also includes benefits from an annual celebrity golf day which other local businesses support enthusiastically, and which this year is at Slaley Hall on September 30. A Honda CRZ coupe is promised to any participant holing in one. Alan Shearer captains the Benfield side, and bets may be getting laid already about which car he may drive home in.

On the trust frontline, Benfield offers work placements.

Nigel McMinn says: “Not everyone has advantages and opportunities some of us have been lucky enough to have. I took it for granted young people had a hot meal every day, went to school, and had both parents to support and encourage them.

“But some kids, I soon found out, have never had that. It’s nobody’s fault. It’s a product of society. If they have grown up without a >>

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ENTREPRENEUR

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What prompted me to want to get involved – when you meet some of these young people and they tell you their story you can’t believe it – is that they are very presentable, articulate, bright and confident, some now with their own business that has been trading for three years sense of self worth and never having had someone say, ‘Look you are very good at that, why not have a go at it?’ – they become conditioned to thinking they will not make anything of themselves.”

The Prince’s Trust gets referrals from the police, the prison service, schools, employment offices, drug rehabilitation centres – any body coming into contact with strugglers who, it is felt, can pick themselves up with a little help.

McMinn says: “Some young people coming through the trust have enormous talent. It has something like an 84% success rate with them once they have attended a trust course, turned

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their lives around and got back into education and work through gaining a sense of self worth. It’s remarkable.

“What prompted me to get involved – when you meet some of these young people and they tell you their story you can’t believe it – is that they are very presentable, articulate, bright and confident. Some now have their own business that has been trading for three years.”

Statistics say that in fact 59% of businesses started up with trust help are still trading after three years.

McMinn says: “That’s good by any measure.

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You meet these people and they are fantastic.

They tell how they were from a broken home, using drugs or alcohol or both, and getting into trouble with the law and one step away from prison. Some of the kids are actually in prison but show some interest in wanting to turn their lives around.

“Some may have been in prison doing a three- or five-year stretch. You look at them and think, ‘No way – not you. I’d trust you with my kids. I’d trust you with my car!’ But what you see is not what they were. Some say they used to be a hoodie. A lot of us read that as a signal they wanted to be intimidating. It’s not that at all.

“They were ashamed. The cover-up was to protect them from the outside world. It’s a self-reflection. If you bother to understand why these kids get into trouble then you understand it’s because they have never been shown support or encouragement. As soon as they are, it’s like flicking a switch. They are not beyond repair.

“As soon as they are given life skills and projects to prove to themselves as much as anything that they can do things, they suddenly leap forward. You think if it’s that easy to turn those lives around and tap that potential why aren’t we doing more of it?”

Benfield, like Cheryl Cole, is also a patron >>

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INTERVIEW

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ENTREPRENEUR

with McMinn introducing other companies to the trust’s work. The charity was founded by the Prince of Wales in 1976, since then it has helped more than 600,000 young people across the UK – and supports 100 more every day.

“There’s a common misconception that The Prince’s Trust is a very well funded organisation because it carries the Prince’s name,” McMinn says.

“But like every other charity it has had a very large amount of public funding scaled back just at a time when there is greater need. So it wants companies to volunteer, open their doors for work placements and unashamedly get them to understand that some more money is needed to keep the thing going.”

Chris Gray, head of private sector fundraising for The Prince’s Trust in the North East at Gateshead confirms: “Young people have been particularly badly hit by the recession.

Many are finding it difficult to get a job.”

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She says the cost of £3 a month to give two weeks’ support to a vulnerable young person and help them find their first job compares with the £10m a day cost of youth unemployment in lost productivity, and the £1bn cost of youth crime every year.

John Wall says the high number of people coming through who find and keep a permanent job is particularly significant given the skills shortages widely reported in the economy.

“The fact that funds raised in the North East are wholly devoted to helping young people in the North East is something that I think appeals,” he says.

Trust running costs are kept low because across the country there are 40,000 people like Cheryl Cole, John Wall, Nigel McMinn and all the others who think the work done is so worthwhile that they serve as volunteers, donating talents and time.

Last year’s Million Makers participants included

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Ward Hadaway, Starbucks, Derwentside Enterprise Agency, Places for People and DWP. The winner then, Northumbrian Water, raised more than £16,000. Companies in the national competition included RBS, Orange, Ernst and Young and Barclays.

Other major corporate partners regularly giving support include the Premier League, the Football Foundation, the Professional Footballers’ Association, more than 60 football clubs and 10 county cricket clubs, Balfour Beatty, Cunard and Marks & Spencer. Skills and expertise are shared with more than 100 blue-chip organisations such as Deutsche Bank, Accenture and HMRC. Many public sector bodies give support too. n Any company wishing to take on the Million Makers challenge in the North East – there is still time – should contact Chris Gray, tel: 0191 497 3210. www.princes-trust.org.uk

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COMPANY PROFILE

Andrew Mitchell from North East Finance looks at the impact of the Finance for Business North East Fund.

BUILDING TOMORROW’S ECONOMY

I

N a little over eighteen months, the £125 million Finance for Business North East Fund has provided support to nearly 200 of the region’s most exciting businesses.

The fund has made a real impact in driving investment in the region in a short time and will continue to do this through to 2014 by which time it is expected to have supported upwards of 800 companies and helped to create 5,000 new jobs.

The Finance for Business North East (JEREMIE) Fund was the UK’s first investment ‘super-fund’ and is being managed by North East Finance.

Initially comprising six separate investment funds, it has this year added a seventh, the North East Microloan Fund. The fund is targeted specifically at small businesses that might be struggling to access finance in the current climate.

The fund managers – alongside the region’s business intermediaries and investment community - have done a terrific job in promoting the funds and in identifying SMEs with great potential. Nearly £23 million has been invested by the funds so far securing over £20 million in private sector finance from co-investors such as VC firms and business angels.

And there have been some really exciting investments. One of the big success stories has been Newcastle-based Palringo, which recently received a £400,000 investment from Northstar through the North East Accelerator Fund.

Set up in 2006, Palringo has developed an exciting new messaging platform that allows people to communicate and share media regardless of their location. The service supports peer-to-peer and group messaging and can be used on any handheld device or desktop.

The company is a fantastic example of how investment can be used to drive growth. It received its first round of funding back in 2006 to develop its technology and has since received further rounds of funding to support growth.

The Accelerator Fund investment, which will

Left to right: Alasdair Greig, Northstar Ventures; Jarek Rosinski, Palringo; Martin Rosinski, Palringo; Tim Rea, Palringo finance Palringo’s next stage of growth, comes at an ideal time as the company has just struck a major deal with 3M to help keep the global giant’s UK sales team connected through its communication platform.

The North East Angel Fund has also been busy investing in exciting Newcastle civil engineering graduates Rob Grisdale and Jack Payne who have created ScratchBikes.

The venture started last year with the graduates setting up a bike hire scheme based at the University with an import of custom made bikes.

It has since been expanded to cover the entire city and has now identified opportunities to scale up the business in other small cities and universities. The Angel Fund investment will enable this to happen.

Entrepreneur James Caan recently highlighted the ‘equity gap’ faced by SMEs like Palringo and ScratchBikes looking for growth finance of between the £250,000 and £2million mark. He highlighted the need for the funding threshold of various investment funds to be lowered to

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meet the needs of businesses looking for finance on this scale – below the level where the bigger venture capital houses traditionally get involved.

The risk aversion of the banks in supporting high growth but early stage businesses has exacerbated this problem.

This is exactly what the Finance for Business North East Fund is doing. The ‘equity gap’ certainly exists for SMEs looking to grow but this is something we recognised some time ago – the Finance for Business North East Fund has been just one response to this problem. It’s been a very successful one so far.

NORT H E AS T

FINANCE For more information about the Finance for Business North East Fund please visit www.northeast finance.org or telephone 0191 211 2300.

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INTERVIEW

Lift off for a new rail industry Persuading Hitachi to invest in the North East has not only brought hundreds of new jobs but also partly restores the region’s international reputation for train building. Brian Nicholls talks to Geoff Hunton, whose affection for railways has done much to secure the deal

It was the helicopter flight that clinched the gravy train for County Durham and North East England – the £80m inward investment that could have gone to any one of 42 locations in Britain.

Geoff Hunton, a key figure in winning the Hitachi train manufacturing and assembly project for the region, remembers the day clearly within a five-year saga, the latter two years of which have also transformed him from a low-profile technical director to a local hero in the job-hungry stretch between Berwick and Northallerton.

His company, Merchant Place Developments, had earlier been asked in London by its agents if it would be interested in providing for a company needing a 350,000sq ft site with a skirting railway line. Only later did the name Hitachi emerge.

Merchant felt its site at Newton Aycliffe appropriate to what’s now referred to as the North East’s most significant inward investment since Nissan’s arrival in 1984 – a claim surely borne out by the presence of 1,500 representatives of more than 1,000 companies when an open day was held

enabling Hitachi and potential suppliers to get to know each other. It is doubtful that any indoor venue in the region other than the XCel Centre at Newton Aycliffe could have coped.

Hunton explains his firm’s role in gaining 500 jobs: “We put in our proposal to discover that 42 sites were being looked at throughout the UK. In our presentations to Hitachi we tried to be professional and show exactly the benefits of the North East – the region, economy, people, the experience of the labour market and the site’s connectivity. This was vital.

“They required among other things 1.1km of test track. I did a deal with Network Rail to lease land to put a test track in. That all came as part of the package.

“When Hitachi and their team came here – contenders were down to 12 then – we hired a helicopter because the only way to see the site clearly is from the air. Colleagues had pegged out the building outline below, so both the site and the connectivity could be seen.

“They could take in Newton Aycliffe as an industrial location, nearby Darlington as a centre of employment, motorway and express

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Across-party political support has been phenomenal, press support exceptional too

rail links, then up to Tyne and Wear. The helicopter even gave a view of Teesport.

They could see almost the entire North East infrastructure.

“Touch of genius? Not really,” Hunton says modestly. “It was just about understanding what they were after.

“We took it stage by stage, through various routes until December 2009, when Hitachi brought it down to two sites – Newton Aycliffe and a site in North Wales. We worked on with Hitachi going through >>

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In our presentations to Hitachi we tried to be professional and show exactly the benefits of the North East - the region, economy, people, the experience of the labour market and the site’s connectivity.

This was vital

THE TRAINS Hitachi will provide rolling stock and locomotives for a new generation of high-speed passenger trains, Super Expresses.

These will replace the UK’s ageing fleet of diesel Intercity 125s. The new trains were approved by the previous government under a £4.5bn Intercity Express Programme (IEP) that includes maintenance. All this is now in the hands of Agility Trains, a consortium of Hitachi (70%) and John Laing (30%).

The Department of Transport (DfT) had begun the IEP process in 2007. In February 2009 Agility was named as preferred bidder and site study began. By February 2010, Hitachi preferred Amazon Park.

Under the new government, Secretary of State for Transport, Philip Hammond confirmed a go-ahead.

Because they run on electricity or diesel these trains promise, apart from comfort, more reliable and cost-efficient running. If oil costs escalate they can run on electricity.

If there’s copper theft or other vandalism on the lines – maybe even just leaves lying – they can switch to diesel.

Production will begin in 2015, with the first trains delivered in 2016.

The trains will initially ply the East Coast Main Line and the London-South Wales Great Western Main Lines.

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proposals, our costs and everything. And we succeeded.”

The Japanese had been told, too, that in setting up the UK’s first new train manufacturing operation for many decades in South Durham it would be setting up in the cradle of the world’s passenger railways. For here was the Stockton and Darlington railway.

And here at Heighington station, beside the site, George Stephenson tested the famous Rocket.

“North East engineering was all part of the picture,” Hunton says with pride.

While his accent is Yorkshire, from a railway standpoint he links his home city of York with the region further north. Besides hosting the National Railway Museum, York had a tradition of coachbuilding.

Hunton came from York to Newcastle, intending to stay two years. That was 32 years ago, and he’s stayed ever since.

“I was with the Government’s Property Services Agency and ended up as deputy director in the North East,” he explains. “So I’m not someone just parachuted in. I looked after government estate in the North East.“ His Yorkshire grit has been vital. Even after Newton Aycliffe was selected as the cradle of modern rolling stock, Britain’s change of government brought with it a “stop” card.

Only in March did the project regain speed.

Hunton warmly praises others who, like him, never despaired – particularly Phil Wilson, MP for Sedgefield, and the determined teams from Durham County Council and the County Durham Development Company.

Hunton says: “I like to think myself and my team brought this project. But in relation to decisions the Government was making at that

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THE PROSPECTS Besides the 500 jobs created, there will be work for 200 in construction, and more than 1,000 more jobs will be safeguarded in chain supply.

Geoff Hunton stresses: “Where possible, we shall use local business for anything from paper clips to construction steelwork.

That’s what it’s about. There’s that very strong engineering background here, for example, also construction firms. Most of the larger ones in the North East I have worked with over 20 years. I’m familiar with them, and what they can achieve.”

More than 2,000 tonnes of steel will be needed for the building frame alone.

Will Teesside’s recently resuscitated industry provide?

“If the price is right,” Hunton replies. “We will go to the market. We must ensure, however, that Hitachi achieves value for money. I’d love nothing more than it be purchased in the North East, but wherever the steel comes from it also has to be designed and fabricated, and there are prominent design and fabrication people in the North East.”

The state downscaling of the programme replacing old InterCity 25 trains from £7.5bn to £4.5bn means work is secure for five rather than 10 years. But Hitachi also intends to build at Newton Aycliffe for mainland Europe, which would extend the programme anyway, perhaps to 20 years. It might be approaching pole position for HS2, the ultra-high speed trains, should they be introduced in Britain eventually.

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INTERVIEW

Opportunities: A Hitachi open day attracted companies from every business sector. time, working with Phil Wilson brought the next stage to the North East. Two years hard work have gone into this, and the excellent contribution by the council and the development company cannot be underestimated.”

His team indeed is small, three in London and six at modest offices in Brunswick Village, near Newcastle. Large design and consultancy specialists work with them too. But the groundwork is done in the North East.

And much has already gone on since Merchant Place pipped other developers in the area to buy – from the county council and the now lost Sedgefield Council and One North East – the preferred plot at Amazon Park.

Hunton hopes a gallery of framed awards on a wall at his offices will eventually be joined by accolades for the Hitachi site. Merchant Place has previously developed a headquarters for Avon Cosmetics in Northampton, and the Expro Subsea Excellence Centre at Ulverston in Cumbria, whose standard in sustainability helped win the title Best Industrial Building in the World.

Hitachi people visited Subsea, where much of the quality of specification, design concept and architectural finishes will be adapted for them, though the Newton Aycliffe building will be three or four times bigger and

different looking. Planning go-ahead is expected by the year end or soon after to get on site towards Q3 next year.

Already the local economy is benefiting. One of the first phone calls expressing interest came from a local joiner whose team of three, he said, could tackle anything. On presentation day, services of an on-site catering van, staffed, was among offers made. Such offers, no matter how small, are being considered “where the prices are right” – and that, says one Hitachi boss, will extend “from the local sandwich business to the guy with sophisticated computer programming machines”.

Hitachi sees its £75m investment in a rolling stock plant here as a platform also to Europe, hence the value of Teesport and two airports nearby.

Hunton himself says he is simply and quietly “getting on with the task of developing in a difficult market”. His previous relatively low profile may stem from his preference to talk about done deals than potential ones.

But this time he says: “The scale of Hitachi’s proposal and its positive potential impact on the region is such that we have been swept along globally by the interest.”

Despite the temporary stalling at Westminster, Geoff Hunton says: “Across-party political >>

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THE SITE Still farmland in appearance, the site has long been designated for office and industrial use. Lots of ecological work had to be done, though, to get planning permission.

Fifty acres were designated as a reserve to protect the great crested newt. So Merchant gently moved the newts and bought 104 acres. Streams and a public right of way have been retained, pond life enlarged, 1,000m of hedgerow and another 2,000 trees planted. Merchant thus met county council requirements.

Now 104 out of 150 acres are a regional strategic site taken with a five-year planning permission for up to 1.4m sq ft.

Hitachi will take 450,000sq ft, turnkey, for 25 years initially. Merchant will also offer other occupiers flexible design in factories, warehouses and offices, again highly sustainable, from 30,000sq ft to 350,000sq ft. With about a third of Amazon Park spoken for, then, Merchant Place is already in talks with a company about taking 900,000sq ft remaining.

“We are already receiving enquiries centred on just in time production,” says Geoff Hunton.

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INTERVIEW

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support has been phenomenal, press support exceptional too.”

Hunton, married for 42 years to Maureen and a resident of Dinnington near his Newcastle office, has had the assistance of elder son Philip, 32, a photographer and graphic designer, for his presentations. Younger son Steven, 25, is an engineer with Sky TV so maybe he too has helped spread the good news.

Colleagues praise Geoff Hunton’s eye for detail and team leadership. He leads by example and is hands-on, even to sending emails in the early hours, an associate says. In resolutely shouldering this project for the last two years, his determination may have had some roots in judo where, as a black belt, he learned early on how to wrong foot the opposition.

His architectural training and background as a chartered building surveyor shaped him otherwise. After his executive role in the Property Services Agency, he became an equity partner of the property consultancy Summers-Inman.

On retiring from there, he turned to Merchant Place Developments, which privately funds and creates new developments, both speculative and pre-let. The Merchant Portfolio value stands now at some £2bn, and there Hunton found his chance to implement his beliefs in delivering projects down a time-honoured route of value for money and high quality, on time and within budget.

“Easy to say,” he agrees. “But development needs a particular focus to get it right.”

He could easily get it right again. n

The scale of Hitachi’s proposal and its positive potential impact is such that we have been swept along globally by the interest

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KEY PLAYERS Key figures besides Hunton include: Alistair Dormer, temporary chief executive, Agility Trains: Delighted by the response received. “We’re committed to the North East,” he says, “and proud to play a leading role in helping to re-establish its status as a centre of excellence for the railway industry.”

Joined Hitachi in 2003. Was managing director of Hitachi Rail Europe Ltd. Previously had been business development officer at Alstom Transport and was in aerospace with BAE Systems.

Keith Jordan, managing director, Hitachi Rail Europe (HRE): Began career in design and engineering on nuclear submarines and other naval vessels. Moved into laser-guided tracking systems and other missile weapon systems. Entered design and engineering management in transport in 1986 with Metro-Cammell (now Alstom) on Hong Kong’s metro and inter-city trains, and metro bus design and manufacture. Held senior roles in train and bus refurbishment for London Transport, and on locomotive and wagon contracts in Australia and the US. Ran two train operation franchises for Virgin Trains and set up a major projects department for Virgin Atlantic Airlines. Joined Hitachi in 2005. Project managed its first UK contract – Class 395 trains serving South East England. Responsible now for the set-up and operation of UK manufacturing and assembly.

Phil Wilson, MP for Sedgefield: Overwhelmingly re-elected last year to the parliamentary seat earlier occupied by Tony Blair, for whom he was once a researcher, as indeed was Stephen Hughes MEP. Has led the cross-party political lobby group guiding the rail prize to County Durham. Has always lived in Sedgefield, also runs his own consultancy in the private sector.

Stewart Watkins, managing director, County Durham Development Company: Battles to bring investment and innovation to County Durham, often in opposition to his homeland Wales.

Heads management also of business parks and industrial estates.

Councillor Neil Foster, Durham County Council’s Cabinet Member for Regeneration and Economic Development: Says: “The range of local companies represented is testament to the sound network of supply we can offer.” An ex-colliery electrician at East Hetton and Wearmouth, he later graduated from Kent University and worked with Sedgefield Council for 15 years until 2009. Elected to county council in 1997. Cabinet member for education for five years.

Debasish Bandopadhyay, head of procurement, HRE: With Hitachi since 2007. Previously had 20 years in projects and supply chain functions for Siemens Power.

Mac Motraghi, head of sales and marketing, HRE: Has raised the visibility and reach of Hitachi transport in Europe. Formerly with IBM, Compaq and Nokia.

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INTERVIEW

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BUSINESS LUNCH

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Taking the initiative

Some people have the ability to deliver a message with such enthusiasm it makes running a business look easy. Alastair Gilmour meets the wholehearted Sarah Stewart.

To describe someone as being on probation doesn’t exactly bring a positive image to mind.

The phrase has been usurped from apprentice’s learning curve to a somewhat darker meaning, which is rather unfair.

So when we portray NewcastleGateshead Initiative (NGI) chief executive Sarah Stewart as having emerged from her probation period,

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don’t assume she’s been required to report regularly to social services. It’s simply that she feels the majority of her working life has been spent building up to the role – she’s served her time, in other words. She’s now an artisan.

“I’d been quite convinced for some time that this was the job for me,” says Stewart, now eight months into the top job after serving as

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interim chief executive of the destination and conference agency since May 2010.

“For the previous 16 years I operated as a consultant in other interesting roles –­ now everything I have worked for has come to fruition.”

Stewart’s “previous” has involved companies which read like a list of brand leaders – Procter

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BUSINESS LUNCH

I’d been convinced for some time that this was the job for me. Now everything I have worked for has come to fruition

& Gamble, PriceWaterhouse Coopers, Sage, Greggs, Shell International – and she has held several non-executive roles at the International Centre For Life, Beamish Museum Development Trust, Port of Tyne Authority, Northern Investors Company, Newcastle Hospitals NHS Foundation Trust, and before NGI beckoned, she was interim director at Newcastle Science City.

But, after a couple of days at her new desk at NGI, she could have been forgiven for having

second thoughts – hers was a baptism of flux, adjustment and revision, if not exactly fire.

The goalposts shifted on day three.

“I took on the interim role at the beginning of May last year after Andrew Dixon (NGI’s previous chief executive) moved on,” says Stewart. “Then come May 4, what happens?

A general election with a new coalition government and everything that happened after that – the disappearance of the regional sectors, One North East going, budget cuts

and the impact that had on local authorities; you name it.

“It was almost as if the job I came in to do suddenly changed – it was ‘forget all of that’.

It came to be a lot about building partnerships, building relationships and establishing the long-term security of the organisation and working in the new institutional landscape that now existed.

“However, there were some core things that NGI was – and still is – doing.”

NewcastleGateshead Initiative was formed in 2000 by Newcastle and Gateshead councils to promote the area as an attractive place to visit and to do business. The organisation’s own research shows that for every pound it spends, £6.20 is put back into the Newcastle and Gateshead economy.

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BUSINESS QUARTER | SUMMER 11

BUSINESS LUNCH exhibition centre to be developed in the region; one that would have the capacity to bring more than 200,000 additional delegates to events each year. And, when it is estimated that visitors to Newcastle and Gateshead from around the UK and abroad already contribute £1.23bn to the local economy, those extra bums are hovering over gold-lined seats.

“Look what we’ve got coming up,” says Stewart. “The Turner Prize is being staged at the Baltic Centre for Contemporary Arts at the end of his year, we have music festivals, the Bridges Festival in August which we hope to run through the Olympics next year, and we’ve just had the EAT! Festival.”

NGI isn’t solely about festivals – although the Newcastle Science Fest, International Jazz Festival, Evolution Weekend, Bupa Great North Run Weekend, Juice Festival for young people and the Wunderbar Festival might tilt opinion in that direction – there are advanced plans for exciting hotel developments, ongoing hosting of national conferences and continued moves to be a world leader in cultural education and learning to take up the slack.

And, a newly-created NewcastleGateshead Facebook page is the latest in a series of digital developments which include a refreshed destination website, a dedicated Twitter feed – @altweet_pet – and a pioneering iPhone app which was one of the first to be developed and used by a tourism organisation in the UK. “The aim of these digital tools is to create a community, a centre for discussion and conversation about NewcastleGateshead,” says Stewart. “The Facebook page in particular is open to user-generated content and we’d encourage people to share videos, photos and comments and take an active role in page activity.

“We hope that these new platforms will help keep audiences up to date with the depth and breadth of activities, events and attractions on offer.

“But it’s important we have a local agenda and we’ll be working with the new Local Enterprise Partnerships (LEPs) – we need to get our voice heard. We feel that as a region we can’t just sit back with a cynical smile and maintain that the Olympics, for example, will only make a difference in London; if we did we would all be guilty of failing to seize a once-in-a-generation

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It was almost as if the job suddenly changed – it was ‘forget all of that’. It came to be about building relationships and establishing long-term security opportunity. As individuals we have unparalleled access to the world’s greatest event, but more importantly we all, as businesses and organisations, must maximise the opportunities on offer for the benefit of NewcastleGateshead and North East England as a whole.”

Football is the major focus of next year’s Olympics programme in the North East. The global extravaganza kicks off two days before the official opening ceremony, meaning the eyes of the world – and its media – will be on Newcastle and St James’ Park. The stadium will

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host nine matches on six days, including the men’s quarter-final.

Stewart says: “It’s not just about getting you to come and spend more money – when we get people here they actually change their mind about the place and if they do that they want to stay here, work here and invest here.

Sometimes we’ve got to remind ourselves of the great stuff going on.

“Actually, NGI has recreated itself two or three times over the last 10-11 years, but we’ve kept the core of what we do – attracting businesses to come here, the conferences and events.

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“There were things like the Capital of Culture bid, the Culture 10 programme, the creation of Tourism Tyne & Wear, all of those have come and gone, but the region has benefited hugely from them. And because NGI has recreated itself through all of that, we can do it again.”

Graciously, Sarah Stewart is never far from praising her NGI team, its dedication to the region and its personal support that her enthusiastic personna invites.

“They’ve been through huge changes recently,” she says. “They’ve got a new chief executive and they were completely up in the air in terms of what the future held.

“But staff turnover is minimal and the loyalty and support they have given me and the organisation has been fantastic. That’s the other key thing that drove me into wanting to stay on in the role – the team. It’s the atmosphere – and yes it’s hard work – but

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BUSINESS LUNCH

there are great professionals at NGI. They all passionately believe in the North East and champion what we do.”

Shortly after its election, the coalition Government stopped regional development agency One North East from spending money on the highly successful Passionate People Passionate Places promotion in a money-saving move.

Further cuts have also seen a drastic reduction in the amount of advertising created to sell different parts of the region to the world at large.

However, as the tourism industry is thought to underpin around 60,000 jobs in the North East and is worth around £4bn a year, national tourist board VisitEngland is taking more than keen interest in the region. Significantly, Sarah Stewart has been selected to sit on the VisitEngland board where she’ll have plenty >>

The event is being organised in aid of The Light Dragoons Colonel’s Appeal, which aims to raise £1 million over the next 18 months to provide assistance and support to those Light Dragoons wounded on operations or in regimental service, to their families, and to the families of those killed on duty. Over the last few years the regiment has served a number of tours in Afghanistan and are due for re-deployment again in 2012.

The Light Dragoons recruit principally in the North East of England in Northumberland, Tyne and Wear and County Durham and the appeal is headquartered at Fenham Barracks, Newcastle upon Tyne. More information about the regiment and the appeal can be found at www.ldcolonelsappeal.com To assist us to raise funds for The Colonel’s Appeal we are offering limited sponsorship opportunities for the golf day from as little as £150.

To find out how you can help contact Bryan Hoare at room501 on 0191 5375720 or by e-mail to bryan@room501.co.uk

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BUSINESS QUARTER | SUMMER 11

BUSINESS LUNCH of ammunition to launch from her own stockpile of enterprise plus what she’s collected from NGI staff activities. In a recent “awayday” for instance, they looked at what the NGI brand stands for, internally and externally.

She says: “It’s useful to sit down and constantly revisit those values – and think about what that means in terms of where we’ve come from and where we go to in the future. Meet what’s coming at you rather than just drifting on the tide. It means you’re in control of your own destiny.

“It’s about the championship of NewcastleGateshead, working in partnership and having a bit of fun on the way.

“I’ve been involved with the Passionate People Passionate Places campaign, worked through private partnerships, helped create the Science City agenda and all the developments and issues that arose – all those elements came together and made this role so appealing.

“It’s been a good apprenticeship, all leading to this thing I’m doing now. I couldn’t have taken this job on if I hadn’t been through such interesting times.”

So, the apprenticeship has been served and approved. Skills have been assessed and experience considered. Several months later the words still sound sweet: “Sarah Stewart, you’re hired.” n NewcastleGateshead Initiative is a public-private partnership supported by Gateshead and Newcastle City Councils working with 170 private sector member organisations across NewcastleGateshead and the wider North East to promote it as a world-class destination.

NewcastleGateshead Initiative is supported by an advisory board of 17 members who offer expertise from a wide range of sectors and professions, working with its principal stakeholders plus local companies, other local authorities, educational bodies, tourism, transport and conference businesses who share an ambition to promote NewcastleGateshead as a world-class place to live in and visit.

NewcastleGateshead attracted 19.28 million visitors in 2009, with tourism supporting 19,200 jobs. www.newcastlegateshead.com

BUSINESS QUARTER | SUMMER 11

SUMMER 11

Lunch!

Sarah Stewart and Alastair Gilmour lunched at The Broad Chare gastropub on Newcastle’s Quayside. The choice of venue was carefully considered as it’s not only fairly new – it opened in May – and is still developing its core customer base, but it shares values with NewcastleGateshead Initiative. In brief, both started with a blank canvas and both know where they’re going.

Celebrated chef and restaurateur Terry Laybourne created The Broad Chare out of the next-door Live Theatre box office and Café Live. It’s an exciting development for the city – a traditional-style pub that treats beer and food with equal reverence.

Sarah Stewart chose a mackerel dish from the specials board while Alastair Gilmour acted on the waiter’s advice and picked pickled ox muzzle – converted from starter to main course with the addition of a few extra pickled onions and hand-cut chips. It’s that kind of place.

Ox muzzle? Isn’t that the (make circular hand motion around nose and mouth) part? Yes it is, and although it’s not to everyone’s taste – though thinly sliced and very delicate – it’s extremely difficult to resist. It’s also exquisite. And the boiled eggs served with it are superb.

Sarah Stewart’s mackerel was a joy to behold. For an observer like Alastair Gilmour who can only think of mackerel as a smoked brown thing flattened into a supermarket blister pack, it was an education and certainly a visual delight – freshly prepared and virtually prismatic in its colouring.

The Broad Chare offers nibbles, snacks and a full feasting menu which range from scotch eggs, Lindisfarne oysters and the pork pie of your dreams to “sharing” helpings of roasts in the upstairs dining room. Tapas-style bar offerings such as pork scratchings and crispy pigs’ ears have developed something of a following and all fresh ingredients are locally-sourced and “fiercely seasonal”.

The pub’s bespoke beer, Writers Block from Wylam Brewery, is infused with fresh hops and the choice of craft beers from America and Europe are hardly bettered anywhere in Newcastle.

The Broad Chare is a partnership between Terry Laybourne’s 21 Hospitality Group and Live Theatre, which owns the building. Profits from the venture are expected to provide around £500,000 over the next ten years to help inspire the theatre’s writers, designers, actors and artists.

The Broad Chare, 25 Broad Chare, Newcastle NE1 3DQ. Tel: 0191 211 2144. www.thebroadchare.co.uk

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HOTELS THAT LOVE TO SAY YES!

PROUDFOOT ON WINE

SUMMER 11

Keith Proudfoot, regional director of the Institute of Chartered Accountants in England and Wales, pores over a couple of Argentinian wines

BUSINESS QUARTER | SUMMER 11

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My approach to wine is akin to an approach to modern art. I can’t tell you much about it, but I know what I like – once I have tasted it.

So to these two wines from Argentina. The new world has provided me with some very pleasant drinking experiences and I was happy to give this vinery every chance to impress my palate.

Chakana’s business model is to produce “affordable wines that over-deliver in quality”, so that was encouraging. The attributes of the Torrontes – the white wine – were described as “a fragrant, floral, honey-accented perfume followed by a medium-bodied dry wine with a smooth texture and ripe flavours”. The recommended temperature for serving this wine was given as 7-11°C, which suits a summer evening just fine – even a muggy one such as the day I opened the bottle.

My California-based brother – who tells me I’m certainly not an oenophile – happened to be staying with my wife and I, so I canvassed opinion on a number of areas. Being an accountant I thought it natural that this review should include numbers and then an explanatory narrative. As this is my review, my scores were counted twice.

The Torrontes was judged for aroma – I have picked up the benefits of giving wine a good sniff before tasting – for flavour, for matching the maker’s description then, most crucially, marks out of 10. Our thoughts can be seen in the table below.

Chakana Torrontes Description accuracy (/10)

Keith

Janis

Colin

Total

8

8

8

32

fragrant, floral, honey-accented perfume followed by a mediumbodied dry wine with a smooth texture and ripe flavours

Aroma/nose (/10)

7

4

3

21 30

Taste (/10)

8

6

8

Like (Y/N)

Y

N

Note 1

-

Overall Mark (/10)

8

5

7

28

7.75

5.75

6.50

6.94

Average

Note 1. “It depends on the price. $20 no; $10 yes” (did I mention he’s an accountant too?)

The next day was raining really hard, so the Chakana 2009 Malbec Reserve, coming hot on the heels of prize-winning Malbec Reserve

PROUDFOOT ON WINE

wine from Chakana in former years, was a treat savoured. I was promised “nose plums and black fruits, spices, with floral notes and chocolate palate delicate notes of fruit and oak, juicy tannins, unctuous and long”. Not sure about the unctuousness, (who likes a smug wine?) but all those awards had to mean something good was coming my way.

This is “the winery’s top selection, aged in wood for 12 months. A dense blue/purple colour is followed by a big, sweet, floral (acacias), blueberry, blackberry, coffee, and white chocolate-scented bouquet. Remarkably rich and heady, with a full-bodied mouthfeel as well as silky tannins”. That’s a lot going on, I thought. My judging panel would test whether there was some exaggeration.

To those who know their wooden casks there was some key information not shared. What was the age or origin or history of the casks?

However the Robert Parker experts had me looking on the up-side once more, having awarded this 2009 Malbec Reserve 90 marks.

true, especially after the tantalising aroma from the glass.

There is a shortage of Argentinian wines at present, caused by the Chilean earthquake – the majority of Argentinian producers are to the west of the country and are transported through Chile. In happier times, this is much easier than transporting across Argentina before shipping but I’m afraid I shan’t be hunting these particular wines out once the situation improves.

But perhaps you are like me and know what you like – please don’t let my indulgent comments stop you from trying these wines for yourself. If nothing else, I know it’s a diverse world and we all have different tastes. n Wines were kindly supplied by Fenwick, Newcastle. Chakana Torrontes, £8.49 and Chakana Malbec Reserve 2009, £10.49.

Tel: 0191 232 5100 newcastle.enquiries@fenwick.co.uk

Chakana Malbec Reserve 2009 Description accuracy ( /10)

Keith

Janis

Colin

Total

6

6

5

23

A dense blue/purple colour is followed by a big, sweet, floral (acacias), blueberry, blackberry, coffee, and white chocolatescented bouquet. Remarkably rich and heady, with a full-bodied mouthfeel as well as silky tannins.

Aroma/nose ( /10)

8

7

8

31 20

Taste ( /10)

5

6

4

Like (Y/N)

OK

Y

OK

-

6

6

4

22

6.25

6.25

5.25

6.00

Overall Mark (/10) Average

Of course, getting someone to take this studied approach can be hazardous. “What do you mean smell? It’s after 9.00 and I’m gagging” was the initial response. But we all showed restraint and enjoyed the beautiful aroma, and then were disappointed by the taste which was barely enhanced by some delicious slow roasted leg of lamb.

As you can see from the table, the aroma lived up to the promise, however we felt that the rich and full-bodied mouthfeel was lacking. As everyone in business knows, the best approach is to underpromise and overdeliver.

Unfortunately we thought the reverse was

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BUSINESS QUARTER | SUMMER 11

MOTORING

SUMMER 11

STEALTH AND EFFICIENCY The opportunity to drive one of the most exciting cars on the road today was too much to ignore for Kevin Hepplewhite, so he took it across North Yorkshire – and did a bit of showing off along the way, of course Kevin Hepplewhite is a qualified Independent Financial Adviser for Joslin Rhodes. The company has been providing unrivalled, unbiased financial advice and support for its clients since the turn of the century, offering

BUSINESS QUARTER | SUMMER 11

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pension, mortgage, savings, investments and insurance advice as well as a wealth management and financial planning service.

Joslin Rhodes also provides advice on employee benefit schemes, company pensions

SUMMER 11

and general financial planning for business.

Kevin took the Mercades C250 CDI Blue Efficiency out to some of his appointments.

OK let’s get one thing straight, I’m no Jeremy Clarkson, he writes. However just like the average 40-year-old guy I know a great opportunity when I see one.

“Would you like to test drive the C250 CDI Blue Efficiency Mercedes for the day?” “Hmm, let me take just one millisecond to think about that. Oh go on then!,” I jokingly retorted.

As you can see I look rather chuffed on my mugshot. But once I had positioned myself behind the wheel and settled into what the brochure states is ‘The Coupe Lounge’ the experience began. The interior is full of an array of gadgets that wouldn’t look out of place in a fighter jet. Needless to say that there is something for everyone.

So what’s in it for all you performance junkies?

Well, here’s the low-down: This four cylinder, six-geared diesel delivers an impressive 204hp at 4,200 rpm, 0-62 mph in seven seconds, top speed of 149 mph (unfortunately I can’t verify this otherwise I would be writing this from the inside of one of Her Majesty’s luxurious prison cells) and a combined fuel consumption of

MOTORING

52.3 mpg. Not bad. Now that’s out of the way, lets talk about the driving experience.

Naturally I took the opportunity to put this little baby through the ropes and “drop in” on some clients in Harrogate. My journey, one that I regularly do, takes me through picturesque Yarm, along the back lanes of the A61 to the bustling market town of Northallerton whilst skirting Ripon before reaching the historic spa town of Harrogate.

Have I set the scene?

The windy road is full of dips and turns, short and long bursts of open road – just perfect to test its road handling. I have to say I wasn’t disappointed. The C250 CDI glided effortlessly through the bends, whilst packing a punch when overtaking the labouring bystanders with a blend of low-down torque with a sublime silky smooth and instantaneous acceleration through all the gears. >>

Enjoy big benefits from a big name in fleet sales and leasing.

At Benfield big is definitely better, because we can offer a range of fleet services that are second to none, including: • All makes and models of cars and vans • Manufacturers’ preferential discounts to pass on to our customers • Cheaper leases on used vehicles • Flexible arrangements on pooled mileage or end of contract options • Longer opening hours for servicing and repair • Designated account management • Priority booking and repair to keep vehicles on the road • Sale and leaseback options to manage depreciation • Bespoke advice to save on motoring costs Tel: 0845 148 3010 www.benfieldcorporate.co.uk info@benfieldcorporate.com

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MOTORING

SUMMER 11

What Bob says ...

Satisfied: The Mercedes C250 Sport Coupe turned heads and strained necks.

Whilst cruising, I ran up behind a... well, shall we say another quality branded softop from a recognised competitor of Mercedes where all the occupants quite literally strained their necks to get a better look. I assumed it was the silver bullet I was caressing through the country lanes and not my rather girlie pink attire and black shades. I left them to “eat my dust” and continued on my journey.

My return trip was a far less exciting drudge back down the A19 to Teesside. Specifically chosen to test the open road, its not the car that disappointed, it simply purred, it was the laborious straight grey track.

In a nutshell, if it’s a quality sumptuous drive in a car with plenty of poke that you’re looking

BUSINESS QUARTER | SUMMER 11

for, then your search is over. Have I sold it to you? Well I’ve certainly convinced myself and the swathes of drooling onlookers. Now I’m off to rattle my piggy bank.

Likes and dislikes: Liked, well everything really, comfort, even distribution of power, a truly exciting drive. Disliked, handing the keys back. n The Mercedes C250 CDI AMG Sport Coupe is priced at £34,280.

For further details contact Newcastle - 0191 2267444 Teesside - 01642677877 Sunderland - 0191 5160303 www.mercedes-benz-sytner.co.uk/offers

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The current Mercedes C-Class saloon was launched in 2007.

BMW’s 3 Series has always been the class leader, but the latest Mercedes C-Class is the first viable alternative to the BMW; in America and Canada the C-Class was the second best selling entry-level luxury car.

Mercedes have given the C-Class a facelift, and although it may look like a subtle makeover! The car now has stop-start technology, a 7 speed automatic gearbox and a high-definition screen on the dashboard. The front bumper is new, and has hints of the S-Class and E-Class. To help reduce weight, Mercedes have made the bonnet out of Aluminum. The car is also very drag-efficient, with an impressive figure of 0.26 cd. Mercedes claims the latest C-Class is 31% more economical than the previous model; the 7-speed gearbox and the stop-start technology both help to improve economy. The interior now has a much more sophisticated look. It has the new addition of a drowsiness-detection system, which warns drivers to prevent them falling asleep. There is also a new option of on-board Internet, which is now available for the first time. The range is priced from £24,715 through to £29,970.

I drove the Mercedes 250 CDI, which had a top speed of 149mph and reaches 62mph in 7.0 seconds. It averages a 46 mpg and it emits 131 g/km of CO2. The C-Class range is available in either SE, Advantage, Sport trim; the Sport models feature sport suspension, speed-sensitive steering, uprated brakes and 18” AMG alloy wheels.

The latest tweaks have put this car ahead of the class leading BMW 3 Series. The car is really great to drive and it feels like it is going to last forever.

Bob Aurora is an independent car reviewer and also owns Sachins restaurant on Forth Banks, Newcastle. bob@bq-magazine.co.uk

NAME CHANGE OPENS UP NEW POSSIBILITIES. Same staff. Same excellent service. New name.On the 1 July 2011 Fawdington changed its name to Lloyd Newcastle.

The decision to change the name was a difficult one but well considered as Fawdington has had an excellent reputation within the local area for over thirty years. We decided that after 12 years of being part of the Lloyd Motor Group now is a fitting time to make the change.

The Lloyd family name has a strong history in Cumbria with its people (both staff and customers) at the heart of its business and has an enviable reputation for quality and customer service. This decision has been made so as to give us more strength and recognition as part of a family owned group, the option to offer our customers greater choice and have access to additional expertise.

We look forward to welcoming you to our dealership.

LLOYD NEWCASTLE

Formerly Fawdington

Fenham Barracks, Newcastle upon Tyne NE2 4LE. Tel: 0191 2617366 www.lloydnewcastlebmw.co.uk

sweeney shod

‘Proper’ footwear doesn’t have to be dull, brown and boring – it can also be ‘quirky with a twist’ as Chris Porter discovers on easing himself into a pair of Oliver Sweeney shoes

“It’s not a guilty pleasure at all,” says Tim Cooper. “I think trainers are fantastic, especially in terms of their styling, and I think more and more people are fascinated by them.

If I’m deciding what to wear in the morning it would normally have been between a 20-year-old pair of Edward Green brogues that I adore, or a pair of Tiger Onitsuka trainers.

I’ve got about 20 pairs.”

That Cooper should be such a fan of the soft and sporty is surprising given his job. Since 2009 he has been managing director and co-owner of Oliver Sweeney, one of the UK’s more established contemporary brands of “proper” shoes – English-made brogues and Italian-made loafers, with the gamut of other styles made in Spain and the Far East. Easy sneakers these are not.

Indeed, if fashion is seeing an appreciation for the heavy, Goodyear-welted shoe – a shock to the feet of generations that have grown up in instantly comfortable if short-lived sneakers – then the company might claim to have been ahead of its time.

When, aged 15, the company’s eponymous founder walked into Alan McAffe’s, a bespoke shoemakers in London, and asked for a job, eventually launching his own line of solid men’s footwear in 1989, the trainer craze was becoming a phenomenon. But perhaps Sweeney spotted that there was a demand among men for shoes that would have been recognised as such by their grandfathers, but that their grandfathers would have considered too modern to wear.

Cleverly, Sweeney – who sold up to Cooper and left the business two years ago – did not ignore the comfort factor either. He had devised his own signature and trademarked Anatomical Last, better mimicking the foot’s actual shape, sculpted to support the arch and reduce rolling to the outside of the foot.

A combination of this ease of wear and a British quirkiness in styling: “A bit less conventional, the old idea of classic with a twist,” has, Cooper suggests, given the brand a loyal following that has allowed it to survive downturns, historic management problems and administration, but also to retain great potential. Indeed, since 2009, Oliver Sweeney has seen like-for-like retail sales increase 38%, and rapid expansion into other products, >>

with this summer alone seeing the launch of sunglasses, blazers, sports jackets and an extended range of bags and small leather goods. A selection of outerwear has already been launched and more products are likely to slowly follow. Could Oliver Sweeney have the makings of a more comprehensive menswear label?

“Shoes will always be the core of what we do,” says Cooper, himself a third generation shoemaker, with management experience at the likes of Bata when it was the world’s biggest shoe manufacturer.

“And I think men are becoming more and more interested in shoes, if not to the slightly obsessive extent that women often are. Not only are they more interested in shoes, but in less traditional ones too – as the male wardrobe has broadened beyond the suit, men have looked for footwear to go with it. It’s a product of media, celebrity and a general increase in style-awareness. But Oliver Sweeney is becoming more a men’s lifestyle brand now. I very much admire Paul Smith’s business – and would certainly like one like that...”

Perhaps in readiness, the diversity of the footwear that Oliver Sweeney sells –from international accounts, six stores across the UK and, increasingly, on-line – has grown over the last two years, giving it a broad customer base, albeit one focused around the affluent 30- to 50-somethings happy to spend as much as £350 on a pair.

Goodyear-welted brogues, tassel loafers, whole-cuts (made seamlessly from a single piece of leather), Chelsea boots and biker boots – often with a signature sweeping, streamlined shape – sit next to crocodile-print and even deep red eel-skin sneakers.

This latter shoe, with its unexpected choice of materials and colour a typical Sweeney creation, is a revisiting of the brand’s more creative heyday a decade ago, when in 2003, Sweeney designed his Chelsea shoe, a square-toed, monk lace-up on a squarebacked heel, one of the company’s best-sellers and certainly the one that put its name on the map.

Other distinctive but wearable styles followed, often in limited editions – a shoe in stingray, for example; the Venice, with its elongated >>

Offic com

Model month

Care instructions:

apply regularly to tarmac

The Mercedes-Benz C-Class Coupé

Call now to book your test drive Sytner Group Mercedes-Benz of Newcastle City West Business Park, Scotswood Road, Newcastle upon Tyne NE4 7DF 0191 226 7444 Mercedes-Benz of Sunderland Hylton Grange, Wessington Way, Sunderland SR5 3HR 0191 5160303 Mercedes-Benz of Teesside Concorde Way, Yarm Road, Stockton-on-Tees, Cleveland TS18 3RB 01642 677877 www.mercedes-benz-sytner.co.uk/offers Official government fuel consumption figures in mpg (litres per 100km) for the C-Class Coupé range: urban: 18.1(16.1)-44.8(6.3), extra urban: 33.2(8.5)-65.7(4.3), combined: 23.5(12.0)-55.4(5.1). CO2 emissions: 280-133 g/km.

Model featured is a C-Class Coupé C180 BlueEfficiency Automatic at £31,620.00 on the road including optional Panoramic glass roof at £1,350, Metallic paint at £645 and Leather upholstery at £1,350 (on the road price includes vat, delivery, 12 months’ road fund licence, number plates, first registration fee and fuel).

I think men are becoming more and more interested in shoes, if not to the slightly obsessive extent that women often are – and in less traditional ones

shape and two seams running to the toe, or – suggesting that the company does not take the naming of its styles too seriously – the Ravioli, a pointy-toed loafer that any Italian hipster might well appreciate.

Some shoes have simply been show-stoppers.

There have been, for example, the cricket ball-inspired shoes – in the same red leather, with the same heavy contrast stitching, and complete with the signatures of the 2005 Ashes-winning England team etched into the uppers – which the company launched to raise money for the Everyman male cancer charity.

And in 2007 Sweeney produced Londinium, a style released in strict limited edition, if only because the heel block contained wood from the first London Bridge, dating to 63AD. For those who want a shoe more unusual still, the company still runs its custom service, through which a customer can select from a range of colours and skins – including 24 exotic skins in gold, green and baby blue, to cite just three of the bolder shades – and then pick details from piping to lining and lacing in order to make a Sweeney style more their own. It is a long way from Cooper’s love for a good sneaker.

“Of course, mostly what I wear these days are Oliver Sweeney shoes,” he adds quickly.

“That’s because, like many of our customers, I really appreciate the British style of our shoes, the solidity of them, and a quality in British designed-products that is harder to define. We may make all over the world, but British design is what we’re about. Our designers are British and the company’s roots are very much here.

Oliver Sweeney’s is a British sensibility.” n

T H E A U T U M N / W I N T E R 2 0 11 C O L L E C T I O N A V A I L A B L E AT: ACORN RD, JESMOND, NEWCASTLE

FINKLE ST, KENDAL, CUMBRIA

T : 0845 835 2900

W W W. J U L E S B . C O . U K

ecstasy and the electric shock Call it the classic of classics or an ostentatious sign of wealth, Rolls-Royce is the world’s leading car brand. Chris Porter luxuriates in precision engineering and expensive leather to discover the marque’s future in today’s ecodriven market is as assured as its distinguished past

When the rumours leaked late last year that Rolls-Royce was actually going to do it, they were greeted with some scepticism. After all, this was the company whose flagship model, the Phantom, was a veritable beast, with its

BUSINESS QUARTER | SUMMER 11

SUMMER 11

hefty haunches and miles of sweeping bonnet peaking in a gargantuan grill. At 19ft long and 6.5ft wide, this was less the proverbial gentleman’s club chair on wheels as the entire club.

And now here was the gossip saying the veritable 6.7 litre gas-guzzler was going to go, whisper it, all eco. Surely, with the luxury market still reluctant to openly embrace environmental concerns – as though to do so was to suggest the penny-pinching, rather than the socially-aware – Rolls-Royce of all car brands was the least likely to take on the golf-cart silence of an electric engine? But it has.

The 102EX is a fully electric powered Phantom, recently unveiled. OK, so it is not being rushed into production. Also known as the EE, for Experimental Electric, it is more a test-bed to gauge consumer reaction and assess whether this is the best eco drive-train for Rolls-Royce to adopt.

Yet the fact that the company has even considered it is a reflection of a new energy

for the brand, largely down to the leadership of Torsten Muller-Otvos. It was he who took over as Rolls-Royce’s CEO last year after a lifetime of brand management roles with Rolls Royce’s owner, the BMW Group, where he was its youngest-ever ascendant to the top table.

Positioning and re-positioning automotive brands is what Muller-Otvos is all about. It was he who oversaw the re-launch of the Mini.

And with the EE he is testing the water.

“It is more an exploration of what our clients think about a more environmentally-friendly engine,” he says. “And clearly we need to make a proper decision on that if we need to down the route of producing alternative drive-trains, which could be diesel, electric, a hybrid, but has to be right for the brand and our customers. It’s less about whether they really want it so much as responding to the changes in legal issues in certain countries that might encourage them to look into the area.

Get it right though and I think there’s definitely a market there.”

Moving Rolls-Royce into higher gear has been

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EQUIPMENT

one benefit from German ownership, however disgruntled many were when (like the recent Kraft take-over of Cadbury’s) the purchase was announced. Muller-Otvos stresses how the Britishness of these cars nevertheless remains – some 80% of employees are Brits, all the craftsmen are Brits, the chief designer Ian Cameron is a Brit, the cars are made here – and that remains a great selling point, especially overseas. But he also gently points out that the reputation for excellence Rolls-Royce once justly commanded had been fading fast, with the brand “stunning in the earlier years of its history but losing its way during the 80s and 90s”. BMW, he says, risking opprobrium from the overly-patriotic, re-awakened “engineering competence, manufacturing competence and the latest in manufacturing technology to get the quality that Rolls-Royce customers expect and what we have to deliver”.

Another further benefit has been the CEO’s enthusiasm for spotting unexploited markets, however incongruous they may seem on >>

BUSINESS QUARTER | SUMMER 11

EQUIPMENT

SUMMER 11

first consideration. How about, for example, a less stately, more everyday Rolls-Royce?

That may not fit with the Rolls-Royce story as it is popularly conceived, but Muller-Otvos has made it work. To the Phantom he has added the Ghost, a car that is a celebration of Rolls-Royce history – it marks this year being the centenary of the Spirit of Ecstasy, Rolls-Royce’s flying lady mascot, said to be modelled on automobile pioneer John Walter, Lord Montagu’s secretary and lover – but one as much symbolic of the times as the new EE. “The Ghost hasn’t been about taking business away from other car brands,” says MullerOtvos. “To be honest, a lot of our customers already have several cars in their garage from several different companies.

“But it is a reflection of a change of philosophy for the company; it’s less ostentatious and I think that will be a key part of what Rolls-Royce is about in the future.

The Phantom, of course, is a statement. It’s often chauffeur-driven, for example. But we also recognise with the Ghost that there was a need for more of a driver’s car, a more

BUSINESS QUARTER | SUMMER 11

everyday car, something more subtle...”

Recognition of the need for the company to broaden its remit has certainly proven successful. Last year saw Rolls-Royce report a record year-on-year sales growth of 171%, with sales of 2,711 cars, more than double the previous record set in 2008, a success largely attributed to the Ghost, which has brought new customers to the brand.

Indeed, some 80% of Ghost customers have, atypically for the company, never owned a Rolls-Royce before.

Not that the brand is in any way going mass-market. For all that, at £165,000 and upwards, the Ghost may be Rolls-Royce’s more affordable car, Muller-Otvos sees no future in one any cheaper than that.

He says: “The economy is getting better and people are getting more confident and coming back to buy luxury products again. But you can’t move established brands too dramatically or too fast, especially one as old as RollsRoyce, with its heritage and tradition. It has to be step by step.

“There’s been talk of launching a more

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affordable car but I don’t think that would be right – our intention is to be very, very highly exclusive. And there’s still no one around the world selling more cars in that segment than Rolls-Royce. You wouldn’t want to see a Rolls-Royce on the corner of every street.

We’d lose that exclusivity overnight.”

But buying a Rolls-Royce is about more than exclusivity. What has buoyed it up through the recession has been an increased interest in quality over mere brand flash in purchases of good sense rather than status.

That, Muller-Otvos stresses, is where Rolls-Royce can really stake a claim. For all that Rolls-Royce is world famous, “these cars are also an investment”.

He adds: “In the end it’s all about build quality – and we make a point of inviting anyone thinking about buying a Rolls-Royce to come to the factory to see how we manufacture cars. When you see the precision put into the engineering, into all the detail, from the leather to the wood, you come away knowing why the cars are at a price level they’re at.” n

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ENTREPRENEUR

SUMMER 11

GETTING THE PREMIUM RIGHT There’s nothing like a coachload of angry customers to set you off on the road to business success, as Brian Nicholls discovers while talking to insurance broker Jonathan Willett For good grounding in the art of handling irate customers, work a bit as a holiday courier.

Jonathan Willett did. Today he’s a managing director, a self-assured insurance broker.

On graduating in business management and communications from Teesside University, he decided to holiday in Turkey. He had already worked part-time in a Marks & Spencer warehouse – here was something different.

Turkey was only starting to attract British tourists then. Part of his job at Gumber coastal resort was to use his sparse Turkish to deliver the visitors from Bodrum Airport. The journey now takes about 20 minutes, but then it was a four-hour coach journey to be done three or four times a week.

“For confidence and dealing with my social skill set, being a travel courier was a kick start,” Willett muses. “You are 18 or 19, living pretty much on your own in a strange country, and on Friday 13th a plane lands.

“I had to inform the people filling a 60-seat double-decker coach their luggage had been left on the runway at Manchester, with the next flight out four days away. You can imagine they weren’t very pleased. Who would get the stick? Not the coach driver – he couldn’t speak a word of English. It was me.

So we had some interesting things to deal with out in Turkey.”

Back to England some months later meant landing on both feet in more ways than one.

He had to find a career.

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“I had always said I wouldn’t go down the insurance route because that was what my dad did,” Willett recalls. However...

“My sister Emma had become involved in the family business. An opportunity for a broker existed in London with a firm we had a good long relationship with. The managing director suggested I go to London, stay rent-free in their company flat, take a minimum wage and see what I thought.

“I never looked back. Lloyds market place is something else, a great opportunity to meet key players, key underwriters. Connections and relationships built there remain firm today.

It was truly impressive – all the underwriters on different floors. It’s buzzing, lively. A lot of business is done in the wine bars.

“Obviously it was a different marketplace from that of the local economy. The one thing I learned, and have based business practice on, is that it is all about relationships with the suppliers, the customers. If you get relations right with your end customer and your underwriter that really is the key to success in our industry.

“You must get the service right too. At Lloyds, if you went to an underwriter with a proposal and good reasons why they should run with it, eight out of 10 times if you had a really good relationship with the underwriter and it was their type of business they would do it for you.”

After three-and-a-half years in London his

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ENTREPRENEUR

Insurance is always about having proven relationships.

A full day of reporting might be necessary with loss adjusters, insurers, clients and broker. The broker must manage that whole relationship

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BUSINESS QUARTER | SUMMER 11

ENTREPRENEUR father phoned him. Willett & Ross on Yarm Road, Eaglescliffe, established by his father Mike in 1970, was expanding. Did he want to return to the North East?

Willett the younger is a Teessider to his bones.

Born in Guisborough in 1974 he had been through junior school at Guisborough, then Yarm Grammar School and Sixth Form.

“I had to decide whether to buy a flat and lay roots in London,” he says. “But I was commuting every other weekend because, for my football sins, I follow Middlesbrough. All

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my friends were still here and all my family.

Did I want to move away?”

Willett returned North.

“I could still deal with the company there and I still do, and I go back once or twice a month to work with contacts I had.”

There was advancement on Teesside anyway, for as Willett explains: “We reached a size where, for buying power, we felt need to be part of a bigger group. The company was sold to Towergate.”

That was in 2003. Two years later, Mike Willett

Fighting flood weightings The very mention of the word “insurance” can threaten apoplexy among business owners and residents who have been victims of the increased frequency of flooding, and who are confronted with swingeing premium demands from insurers.

Besides instances he cites of where a broker can help, Jonathan Willett has been a flood victim himself. He recalls last year’s episode.

“In commercial premises it was anything from a warehouse with damaged sprinklers to goods significantly damaged through burst pipes,” he says.

“Then there were household claims. At my house, loft pipes froze and burst while the tenant was away for Christmas. The roof had caved in. Carpets were ruined. Redecoration was essential.”

It must strike a chord with many people in Tynedale, Morpeth, York and Carlisle.

“We had a huge amount of client volume then, both commercial and personal.”

There is another side. “The day before, I met one insurer. They were all set for profitability but when they resumed work after Christmas the profit bonus had gone because of all the claims.

The problems were massive.”

Succour was possible though. The Trout Hotel at Cockermouth, dating back to 1670, had its ground floor devastated beneath eight feet of water. But Sue Eccles, the hotel’s managing director, was able to say later: “Our stress was lessened by the speedy action and the professionalism and support of our insurance brokers.”

It was Henderson’s Teesside office that stepped in, smoothing the path of a £5m claim to pay for repairs and cover loss of profits during closure. It also enabled the hotel’s office to switch temporarily to a business park, so some business could continue and advance bookings be taken for eventual re-opening.

Large claims often include business interruption. Once, fire was the fiend in the sauna at a health club in the South. Most of the building was damaged. Amid the disruption recompense in membership fees was secured. The insurer also paid for advertising at the reopening a few months later, when the club had a new pool, new sauna and new showers.

Insurance costs for riverside properties is now an issue, he agrees. “But we insure businesses in Yarm and on Riverside Park Industrial Estate in Middlesbrough, which is actually down as a black zone by a number of insurers.

“With barrage and flood protection facilities now, riversides can be safer than some other places.

Insurers may offer cover but want to impose excess. Often we go through serious negotiations, even bringing surveyors to see protections in place.

“I say to anyone: ‘Don’t despair. We can have a go at negotiating.’ York is a challenge, yet we have properties insured there. The premiums may be a little higher but they are negotiable.”

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retired and the two remaining Willetts got heavily involved in running Towergate Teesside Ltd. “Towergate was big, turning over more than £3bn,” says Jonathan Willett. “We felt ultimately that certain things made us want to be independent again.”

Today he and sister Emma are key players with Henderson Insurance Brokers Ltd which, over 25 years, has become one of the country’s five leading brokers. Joe Henderson of that ilk had been financial director of a big construction firm and dealt with the insurances. He decided in 1986 there was money in brokering.

His business at first covered mainly Hull, Humberside, Scunthorpe and Lincolnshire, then it entered the Leeds marketplace and beyond. Today, while the main office is at Tingley, Leeds, head office remains at Kirmington, Humberside Airport. The Willetts’ opportunity came when Henderson wanted a presence between Newcastle and Leeds.

“They wanted into Teesside,” says Willett.

“We fitted their model, knowing the area, the people and the owner-managed businesses.

“We had enthusiasm and the time seemed right to take an opportunity to build a good strong business.”

Currently, only 26 of Henderson’s entire 330 staff in 10 offices work at Stockton. But a

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ENTREPRENEUR

Lloyds is something else, a great opportunity to meet key players, key underwriters. Connections and relationships built there remain firm today. It was truly impressive – all the underwriters on different floors. It’s buzzing, lively. A lot of business then was done in the wine bars. Today to a certain degree that is still the case team of 50 is expected to accrue within three years, compared with six at start-up. The firm also expects to be in its own building within a year, beside suites where it presently works.

They belong to a key client, Map Group, which employs more than 1,000 people and has 650 vehicles going out to install and replace cabling for Virgin Media – actual cable contracting too. That gives some idea of weight in Henderson’s support.

In a £200m turnover business, work is profuse and varied. Henderson safeguards three of the biggest construction firms in Europe. It spreads through plcs, public sector, academia and small and medium-size businesses.

It provides bonds, be it a performance bond or a travel ABTA bond, and it offers bad debt provision, insures credit risk, and professional indemnity for accountants and solicitors.

Teesside’s haulage portfolio includes Preston of Potto and its 200-plus vehicles. It also features heavy engineering, construction and industrial, and it acts for foreign companies on Teesside that have to place Road Traffic Act insurance and Employers’ Liability within the UK. Willett says: “Though we have the volume in those areas we do anything from a one-man sub-contractor to your plc. We can be involved, one day to the next, in pretty well anything.

“This morning I was with a large construction plant company, this afternoon with a large haulage contractor.

“Tomorrow I’m with a company that designs and installs orangeries and conservatories. We

use expertise available right across the group.”

Group schemes in employee health care, pensions and planning are also in the remit.

Willett says: “We have agencies with every insurer. It’s our job to search the marketplace, offer a proposition and relate any risk involved.

We then source the best deal, discuss it with the client, the security and background with the company, and place the covers on the client’s behalf, dealing with all documentation and processing.

“Any claims, we handle with the insurers.

On bigger corporate business we work on an annual fee for our professional services.

With so many insurers outsourcing to call centres and trying to streamline, clients may not have wherewithal and time to deal with that themselves.

Emma, 40 this year, is joint managing director with Jonathan.

“We have a good complement of skills sets,” he declares. “She excels in human resources, FSA compliance, internal and day-to-day management.”

He is usually out four days a week nurturing clients, dealing with issues or problems and negotiating new business. Frustrations of the job?

“Insurance is about having proven relationships,” he says. “A full day of reporting might be necessary with loss adjusters, insurers, clients and broker. The broker must manage that whole relationship.

“A number of banks are also insurers. We all know the banks’ difficulties, and companies they run are more difficult to deal with too.

Sometimes the frustration from the banking side is that things must be black or white.

No grey.” n

Fighting fly-by-nights Some companies enter the market, buy insurance turnover, then write premiums that are unsustainable and go out of business.

Jonathan Willett’s advice: Look beforehand at the insurer’s credit ratings set by the likes of Standard and Poors and AM Best.

He stresses: “They are there for credibility. Check If the insurer is offshore or based abroad, maybe in Gibraltar.

“Yes, consider a quotation but also ask to see the latest report and accounts. Be sure the insurer will have funds to meet any claim. A number of insurers have onerous exclusions in policies too.

Unless they are explained in depth you can catch a cold. As a broker we are there to help on that.

“We can also locate a more competitive insurer but then point to a double A insurer too so there is a comparison – pay cheap or pay a little more for peace of mind.”

In road accidents “no win, no fee” with its extensive advertising puts insurance costs up.

Willett admits: “It has made our job a lot more difficult. You look at a client’s claims history. You may have a claim paid for the injury to the employee or the passenger at £10,000 – but you could have another £20,000 for legal fees on top.

“So the size of the claim has tripled through getting two solicitors involved – one for prosecution and one for defence. Very frustrating. But that’s the society we live in. The Government is trying to introduce capping of claims costs. To date, nothing firm has rolled out.

“Unfortunately,” he warns, “the no win, no fee bandwagon will continue to roll.”

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INSIGHT

SUMMER 11

NE1 CAN JOIN IN THE FUN It’s taken Newcastle 39 years to latch on to a remarkable fun-raising, money-making improvement plan. But having launched now, the city looks something of a world beater at it. Brian Nicholls reports

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It’s hardly the most user friendly brand name to put before the public. Yet Business Improvement District has had probably the greatest effect this year in raising Newcastle city centre’s stock as an attraction to visitors – increasing quite remarkably the public spend there.

Many people who have enjoyed themselves through the area’s new status probably aren’t fully aware of what it’s bringing. Nor need they be. All they have to do towards the success of NE1 is to jump aboard and be part of it.

Figures emerging suggest that while the concept of a Business Improvement District (BID) is no North East brainwave, central Newcastle is gaining immensely from it. A BID is a defined area within which businesses pay an additional tax or fee to fund improvements to that area’s benefit.

The idea originated in Bloor West Village, Toronto, back in 1970, where traders obviously had no hesitation in giving a buck to make two. It reached the US through New Orleans four years later and now, besides around 1,000 such districts throughout that nation, BIDS flourish in Germany, South Africa, New Zealand and even in the like of Jamaica, Serbia and Albania.

They took a long time to reach Britain, but in 2003 the then Government legislated for their introduction here. Today there are maybe 90 in this country, developing local solutions to local problems where businesses vote to have them.

Different places have different challenges, and a BID is only as strong as its membership allows.

Remarkably, central Newcastle’s NE1 is now claiming a world lead in size, if you combine geographical area, levy raised and the number of business members.

Many BIDS are supported by around 250 businesses.

But according to NE1’s chief executive Sean Bullick: “Compared with Times Square in New York we are huge. Dublin raised a bigger levy but post-apocalypse it doesn’t, and I don’t think its territory is as big. Heart of London, around Leicester Square, is about 200 businesses raising around £1m by levy.

“Here, however, we are 1,300 businesses. We raise about £2m from the levy. In development terms that’s small change. But for catalysing and focusing delivery it’s quite a lot.”

The area covered takes in the NE1 post code with bits of NE2 and NE4. It includes the Central Motorway, Haymarket, the Great North Museum and Exhibition Park, Newcastle University, the RVI, St James’ Park and Boulevard right down to the Tyne.

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Core funding comes from a 1% levy on the rateable value of businesses. So a business paying £20,000 in rates would pay on top £200 into NE1. Very small businesses such as corner shops are excused payment, but are expected to participate in return.

The organisation has an executive committee, overseen by a board of directors from key sectors of the business community. Together they try to lever additional funding in cash or kind. Through state funding earlier it doubled its Street Rangers – just one of the innovations – from 20 to 40. The Rangers have bikes from which to distribute information to visitors, and “meet and greet” information points. They also liaise with the businesses, reporting back any problems or suggestions, many of which may be from customers.

Cash for specific projects also come from the city council. But now, says Bullick: “Funding generally is being cut back, and we no longer get a contribution from One North East. But we try to work also with businesses on projects of mutual interest.

“A private and independent company can still apply for grants – through the Regional Growth Fund, for instance. Also there is European funding in some circumstances, and nearly half-a-million has been leveraged elsewhere.”

By integrating ideas and enthusiasm special themes can be introduced that promise novelty for the public and revenue for the businesses. During Restaurant Week recently about 15 good restaurants offered early evening diners a set meal for £10.

“That was a phenomenal success,” Bullick says. “By Wednesday you couldn’t book a place for the rest of that week. This will continue twice a year. The next one is in August.”

Then there was Fashion Week – 80 events over eight days and the presence of designers like Wayne Hemingway and Hartlepool’s Scott Henshall, reputed designer of the most expensive wedding dress ever, for Angelina Jolie. The biggest project to date has been Live After Five – unique to Newcastle when launched last October. This is where city centre shops and other attractions stay open until late evening and parking is free. Other cities open late but without a package.

Footfall in Northumberland Street in the first four months this year rose from 10% to 14% with an average 11%. So if you stay open you get people Extra buses complementing the normal Metro service encourage people to linger in the city after work, or to come out in the early evening. Bars and restaurants have themed offers each evening and co-ordinated events like the Fashion Week are sometimes organised. An investment of half-a-million pounds was made in the marketing and £100,000 in the special events. The result?

Bullick says: ”It was and remains a very challenging economic environment in which to try something like that. But it pays dividends, despite higher overheads brought by extra staffing and things like that.

“We calculated the benefit within the first six months to be £53m. Eldon Square reported footfall up three-quarters of a million for those

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INSIGHT

three extra hours a day. Average footfall in those three hours now is 17.29% going through after five o’clock.”

Bullick gleefully compares Newcastle’s response with results from Manchester’s early evening shopping programme. That started six years ago and aimed to get to 20% in that period, which it did.

“So we by that yardstick, and in the time we have been operating, have done very well,” says Bullick.

“Average percentage of daily take in those extra hours is now more than 14% from businesses we have spoken to. We found 83% of members of the public are aware of Live after Five, and 80% thinking 8pm is the right closing time. Some 74% have taken advantage.”

Apparently this does not detract from Saturday and Sunday retailing. The numbers are total gains.

“One retailer has told us that while trade has been tough it would have been tougher without Live after Five. His group’s peer stores in Manchester and Liverpool are not doing well, suggesting Live after Five put his business in the black.”

Bullick is under no illusion the job is done.

“But we believe it will go from strength to strength,” he says.

Side benefits for the city centre include a financial contribution NE1 makes towards extra policing. And its Street Rangers, whose primary job is to give the public information, also act as additional eyes and ears in making the area safe. It’s tidier too in the evenings through additional cleaning by NE1’s Rapid Response Clean Team, on contract from Mitie.

The Street Rangers and Clean Team were introduced within two months of NE1’s launch in 2009.

“They have testimonials coming out of their ears,” Bullick says proudly. “The greatest numbers of the public responding to Live after Five are 16 to 34-year-olds. But we are also persuading families. More of them are coming in, encouraged by free parking after youngsters are collected from school.”

How does drawing in families square up with Newcastle’s “party city image” and the personal excesses sometimes associated? Do interests clash? >>

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INSIGHT

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Bullick replies: “We recognise party city as very important to Newcastle’s economy. People come to Newcastle because they have a great time here. We want to encourage that too.

We see it as an element of Newcastle’s offer, which also includes theatre, art, concerts and things like that. Alive after Five is closing the gap that existed after 6pm until celebrants came out. The contrast between daytime and evening is now diluted.

“If Alive after Five works as we expect, it could earn an additional £243m for the city centre economy – a phenomenal return on an investment from a budget of a couple of million pounds. Manchester reckons it needed five years to reach full cruising speed. But in Manchester the business participation is voluntary. Here at Eldon Square the tenants’ association voted for our programme and, once approved, it was binding on everyone.”

Often decisions in branches of national stores are made nationally, or through a regional manager.

“We now have to persuade those yet to stay open to study the figures,” says Bullick.

“Footfall in Northumberland Street in the first four months this year rose from 10% to 14% with an average of 11%. So if you stay open you get people. Theatres and museums take part where they can. The Centre for Life, for example, puts on evening attractions now.”

Some scaling back in support has been unavoidable. The Street Rangers are back to 20 in number with the paring of funds, but it is hoped volunteers may fill the breach.

NE1 demonstrates through four innovations in particular that much can be done on little: • More green space, which the city centre has previously lacked. NE1 has introduced three pocket parks – at 57 Quayside, Cathedral Square, and at the Bobby Robson memorial garden between St James’s Park and the City’s Chinese arch. Also on the Quayside until the end of September, you can loll at Newcastle a La Plage, as they laughingly call the Wesley Square area where a beach, palm trees, volleyball court, deckchairs, ice cream concession, decking and rocks now skirt the river. And on paved stretch between Grey’s Monument and the Theatre Royal trees have sprung up.

• Public loos, written off as needless expense

BUSINESS QUARTER | SUMMER 11

Good enough for France, good enough for us Who’d give up life beside the Loire with its fairytale palaces and verdant vineyards to put a buzz in Newcastle instead?

Well, Sean Bullick did. He had a two-year sabbatical in the French paradise before he and his wife Bridget decided Newcastle was the place to raise a family. They’d gone to France with one child and came back to England with two.

Bullick, born in Edinburgh and educated at boarding school in Hampshire, had previously worked in London. Bridget is from Essex. But they had met at Newcastle University, and now with son George, eight, and daughter Grace, three, they live contentedly in Gosforth.

Bullick, 44, had added to his history and politics degree a law conversion course at Newcastle Polytechnic (now Northumbria University). He worked with a London law practice for 10 years and became European legal counsel for Quaker Oats.

Then he ran the National Museum Directors’ Conference, a liaison of 29 national galleries. It involved him in intriguing legal issues such as returning art looted by the Nazis, and items to former colonies. In a lobbying and PR role he increased funding for the group by 20% – £30m in hard cash.

His stay in France, where he helped the Mayor of Loche set up an arts foundation, enabled him to appreciate how purposeful the French are in what they want and what they think is best.

“France values culture hugely,” he says. “The GDP going into it is much higher than here. That determination was something I came away with as a focus. I see Newcastle taking its place as a European regional capital, so it’s important to have the infrastructure and the outlook. I think the outlook is as important as anything.”

And the outlook here is that the Loire’s loss could be Newcastle’s gain.

by councillors in many towns and cities, who ensure nevertheless their conveniences remain at the town and city halls – here NE1 has persuaded businesses to promote use of their loos without users necessarily making a purchase.

“There’s a common belief now that people using the facilities will spend some time and perhaps money in the shop before moving on,” Bullick says.

• A Child Safe campaign, whereby children can wear a wrist band with a contact number in case they get separated from their guardians. Bands were sent to 82 schools, and are given out also at shops and museums.

“No-one wants to suggest it’s dangerous to bring children into the city because it’s not,” Bullick says. “But it does give added security.”

• A more legible city. More signs are being put up, not only in English but, hopefully, in other languages too. Chinatown has Chinese signage already.

Bullick points out: “Pedestrian signage has economic impact. A well signed city can

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increase footfall in the evening by 50%.”

Further plans will cost more. Permission is awaited to install 31 pontoons over the next few months between the Millennium and Swing Bridges, allowing visitors to sail upriver from overnight riverside anchorage or local marina to enjoy entertainment on the Quayside. With Olympic football bound for St James’ Park, NE1 also wants wi-fi on tap throughout the city centre. It wants city centre bike rentals like London’s and, taking a cue from Sunderland’s Take That successes, is working with Newcastle United to plan a day-long, open-air music festival.

NE1 also hopes to foster a digital hothouse, through professional services and the universities, to nurture local businesses and entrepreneurs.

NE1’s biggest handicap is lack of time, since much groundwork falls on a team of six.

Bullick laughs: “We have proved we can provide income gains for business as we improve the city experience for our public, whether residents or visitors.” n

SUMMER 11

COMPANY PROFILE

Commercial property is one of the biggest investments companies make, and a personal approach from legal experts is a must

A PERSONAL SERVICE IN A COMMERCIAL FIELD

L

LATIMER HINKS solicitors, one of Darlington and County Durham’s longest established law firms, is able to serve businesses across the world through its team of commercial property experts.

The commercial property department is led by a team of three Partners, Tim Haggie, Neil Stevenson and Nicola Neilson, each with proven track records in the field, and all clients deal directly with these individuals.

Tim, Neil and Nicola provide advice on a wide range of transactions for both sellers and purchasers.

Such services as option agreements, negotiations with developers, developer agreements and advice for landlords and tenants, are delivered to clients in the North East and across the country, as well as to overseas investors looking to establish property portfolios in the UK. With a wealth of experience spanning 40 years, Tim was recommended in the prestigious Legal 500 directory’s agriculture and estates sections in 2009 and 2010. Many of Tim’s clients are based in the Midlands, the South of England and abroad, and he has also been listed in the Legal Experts guide in 2007, 2008, 2009 and 2010.

Neil’s specialism is acting for retailers and owner occupiers in all manner of business premises, including public houses and leisure property, and he has also been instructed by a number of charities to deal with their property requirements.

A recent President of the Tees Valley Law Society (TVLS), Nicola’s work has been recommended in the real estate category of the Chambers UK guide in 2011. Her landlord clients range from those with a single property to those with a large and varied portfolio.

Both Tim and Neil are experienced in handling matters relating to renewable energy, including wind farms.

Partners, Tim Haggie, Neil Stevenson and Nicola Neilson

RATHER THAN SIMPLY FIND AND SOLVE PROBLEMS, AT LATIMER HINKS WE BELIEVE IN ANTICIPATING ISSUES AND HELPING OUR CLIENTS TO ADDRESS THEM BEFORE THEY ARISE Latimer Hinks’ Managing and Senior Partner, Tim said: “Our experience with commercial property is extensive and reaches beyond the boundaries of what would be seen as the norm for high street firms, both in terms of service and in the geographical spread of our clients.

“Rather than simply find and solve problems, at Latimer Hinks we believe in anticipating issues and helping our clients to address them before they arise. When we do find problems, we help to create solutions, helping our clients to get to the point they wish to reach.”

Neil added: “One of the important aspects of Latimer Hinks’ commercial property service is that, whether it is a matter relating to retail outlets, negotiations, commercial development, or any other commercial property issue, our clients deal directly with us, the Partners, for a direct, personal service.”

Nicola said: “The specialist knowledge in our team gives clients peace of mind; they know that their matter is in good hands and that we will use our

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experience and expertise to find the solution they are looking for.”

Latimer Hinks, which is based in Darlington’s Priestgate, has a team of around 50 people serving private and corporate clients.

The firm’s range of expertise and services covers legal issues surrounding residential property, wills and lasting powers of attorney, trusts, probate, long-term care, tax planning, commercial law, alternative and renewable energy, property and disputes, business rescue and debt recovery, employment, and land-owning.

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

BUSINESS QUARTER | SUMMER 11

IN ANOTHER LIFE

SUMMER 11

PUSHED TO THE LIMITS In office hours Michael Morris is an audit and assurance partner at Newcastle accountancy and advisory firm unw. His spare time, however, is devoted to one of the world’s toughest endurance challenges. He explains, why in another life, he might have been a full-time global competitor in Ironman triathlons Throughout my career, and especially now as a partner at rapidly growing unw, I have found it important to maintain a good work-life balance – especially as I am the type who gets easily absorbed in my job. I love the thrill of pursuing challenging activities outside work, as it gives me a much needed alternative focus. I also love achieving targets and overcoming obstacles to get there.

My love and fascination with sport was first inspired growing up watching Steve Cram. I have been in athletics since I was 15 and competed nationally for almost 15 years.

Highlights included finishing sixth in the UK 1,500m Championship and running the metric equivalent of a four-minute mile. It wasn’t until 2008, however, that I felt I needed a new challenge, which is what led me to the Ironman triathlons.

An Ironman competition comprises a two-and-a-half mile swim, a 112-mile bike ride and finally a marathon, pushing your body and mind to its limits. This is why so much prior training is essential. Currently I train anything from 15 to 18 hours a week in my free time.

This year I have already completed a triathlon in Abu Dhabi where I finished second. And now I am working towards the qualifier for the full distance Ironman World Championships.

This is in Germany in August before the final in Hawaii in October.

One of the things I love about competing is the experience gained while travelling, sampling different cultures and staying in a

BUSINESS QUARTER | SUMMER 11

wide variety of small traditional villages from Austria and Switzerland, to faraway places such as Abu Dhabi. The competitions always end in an enormous party with fireworks and music to relax, unwind and reflect.

I get the same satisfaction and sense of achievement from my personal development as I do in my career development. Sport teaches you discipline and gives you drive and confidence which are completely transferrable skills for business. I have a great team around me at unw who are very supportive of everything I do inside and outside work. This is one of the reasons why the firm attracts quality people and is doing very well in the tough economic climate.

I think to succeed in life you have to do what you love, and what you are good at. I am lucky enough to have the opportunities to achieve personal goals both inside and outside work, and the passion and ambition to strive continually for improvement. n

Sport teaches you discipline and gives you drive and confidence which are completely transferrable skills for business

100

2733

NIGEL WRIGHT RECRUITMENT, BRINGING TOGETHER HIGH-CALIBRE CANDIDATES AND WORLD-CLASS ORGANISATIONS ON A TEMPORARY AND PERMANENT BASIS.

www.nigelwright.com

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MEDIA BRIEFS

The Scrutator >> Welcome to Yorkshire Our regional Press wallows in a financial trough, with jobs being lost in wave after wave of redundancies and even the printing of our papers being shifted from the communities they serve. Newcastle’s Evening Chronicle coming off presses in Middlesbrough... The elegant Priestgate headquarters of The Northern Echo and the Darlington and Stockton Times open to offers from retail in favour of smaller, definitely duller premises elsewhere in Darlington...

Newsquest, UK arm of the mighty US Gannett group, wants to liquefy assets and print D&S news from County Durham and Teesside at Bradford. With the Echo already printed from York, why not another surrender to Yorkshire?

So called Newcastle Brown Ale is brewed there. The trend not only sells off family silver but undermines North East culture, too.

Wouldn’t a better idea have been to sub-let some of the Priestgate building, persuading kindred spirits in radio, TV, PR, advertising and digital to meld into a resurgent media centre for the south of the region?

A museum of journalism would be appropriate too, given the great names and exclusive reports associated with the area over the years. That might then also have preserved the inner sanctum of two of the world’s great campaigning editors, Sir Harold Evans and WT Stead, who both led The Northern Echo at one time.

Perhaps what goes around comes around – like the technologically advanced manure, one 16lb spread of which adequately nourished an acre of land for eight years, according to the Darlington Mercury in 1772. That must have

BUSINESS QUARTER | SUMMER 11

SUMMER 11

stunk a bit as well. Michael Morrissey, former business editor of the Evening Gazette in Middlesbrough, met Harold Evans in New York recently. Evans, between psyching himself up to write two more books – a Bill Clinton biography and a textbook on Bad English (a pet subject, understandably) – pointed out that the cost of getting a paper from the presses to reader’s homes is the biggest drawback to print news surviving.

He says Hewlett Packard has a $2,000 piece of equipment able to print a newspaper in our lounges. But it is not on the market. Would the market bear that cost?

Meanwhile, many of our newspapers could help themselves and give a truer readership figure by publishing print circulation figures and website hits together. There is still a big demand for news, whatever its medium.

obsession has cost him the respect of his wife and daughters. He’s an involuntary crutch for his husband-dumping sister-in-law. His inability to delegate work buries him ever deeper beneath a mound of office problems, blinding him to the affections of his secretary and costing him peer respect. Know the sort?

Will he, won’t he make for the escape tunnel? Nadir and a surprising outcome is reached with a dry sherry and tomato juice.

You’ll be surprised by the outcome.

Author John Ashton (alias Hartlepoolphiliac Mark Hargreaves, ex-Grant Thornton, Newcastle, and now finance director of HarperCo at South Tyneside), has written this comedy in Michael Frayn vein, but rudely.

Humour comes via a style of screenplay scripts, the hapless duo’s misdoings being interwoven with the bar-room crack of other locals. All of this is underpinned by pseudo-intellectual footnotes. And you didn’t think footnotes could be funny...

Real pubs inspirational to the story are listed at the end. Vanguard Press’s £9.99 paperback is welcome relief from some of the angst-ridden fiction recently portraying our region.

>> Green pages

>> The unaccountable accountant You think business has lost its sense of humour hereabouts? Have a taste of Business Breakfast.

Its 316 pages of farce surround a dissolute accountant and his equally challenged banking buddy – Andy Capps in pinstripes – whose common lot is to get through unhappy marriages with regular exchanges of Anglo-Saxon banter, bad jokes at business breakfasts, and regular bar breaks anywhere between Newcastle and Cleveland.

Banker Pete keeps his pecker up, so to speak. Not so Grant, the anti-hero. Work

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A free-to-join ethical book exchange website now runs from Newcastle – GreenMetropolis.com. Members list books for sale by entering their ISBN code. All books are sold for £3.75, of which the books’ owners get £3 a time, with another 5p going to The Woodland Trust.

Members can also donate part of their earnings to the trust and other charities if they wish. IT consultant Barry Crow, a book junkie, launched the site following redundancy.

Forced to downsize his home, he also had to dispose of £2,500 worth of books. They were first on sale.

Now he says, thanks to helpful friends, about a million second-hand books make up the stock.

“Through this people can read cheaply and do their bit for the environment and charity too.” www.greenmetropolis.com

Busin

WHEN YOUR MONEY’S NOT ALL IN ONE PLACE, IT’S A GOOD IDEA TO HAVE ONE PLACE LOOK AFTER IT FOR YOU. At Brewin Dolphin, we believe that both an overall and a long-term view are necessary when planning our clients’ finances.

Because life doesn’t come in discrete little parcels, we always make sure your investments are balanced across different sectors. An approach which helps you to make the most of things like tax and pension allowances, and helps us to make sure we live up to the one simple philosophy that guides everything we do: that the first thing we earn is your trust.

Investments may fall as well as rise and you may get back less than you invested.

For more information please contact George Slack on 0845 059 6370 or at george.slack@brewin.co.uk Brewin Dolphin is a member of the London Stock Exchange and is authorised and regulated by the Financial Services Authority No.124444

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BIT OF A CHAT

SUMMER 11

wished her to stay in view of the “immense contribution” she had made.

Also I reckon that behind that mock grimace on John’s face as he talks of the new regime there’s a recognition that the company has got itself a top level, needle-sharp and dependable organiser.

with Frank Tock >> Have to ask the missus...

Travel entrepreneur John Hays is first to admit he’s watching his step now, to avoid falling foul of his new executive chairman. He may be founder and managing director of the UK’s biggest independent travel agency, but she might still harangue him mercilessly across the breakfast table.

The new executive chairman of Hays Travel in Sunderland is Irene Lucas, otherwise Mrs Hays, whose expertise now benefits the private sector since she left her senior Whitehall post at the end of last year. She did that in the wake of a 40 jobs cull in her department, including a halving of director general posts from six to three.

Irene had already had an illustrious 34 years in local government, including a chief officer’s job at Sunderland Council and chief executive’s job at South Tyneside, where to this day she is remembered warmly. She was awarded a CBE in 2008 and featured in a list of most influential people in local government.

She’d been drawn to London in September 2009 as director general for local government and regeneration and became acting permanent secretary in May 2010, after Peter Housden was appointed permanent secretary to the Scottish Government.

By last November, however, Irene had decided to step down as director general at the Department for Communities and Local Government. A single ticket back to the North East ended the Hays’ hectic hopping between a London flat and their family home in much more salubrious Whitburn.

I would imagine being involved in dissembling One North East didn’t delight Irene, even though Sir Bob Kerslake, who took over as permanent secretary, said he would have

BUSINESS QUARTER | SUMMER 11

>> Oh no, not again Did we rescue Northumbrian Water from the French just to have it seized instead by the Chinese? The news that a Hong Kong utilities giant, albeit apparently skilled in its business, may be in with a £2.4bn chance of acquiring one of our diminishing stock of sharelisted North East companies makes me think the firm’s location, Pity Me, more than a tad ironic.

A lot will depend on which way the Ontario Teachers Pension Fund with its 26% stake wants to turn. That doesn’t mean customers shouldn’t make their unease known. Boards often say in these situations that they have a duty to secure the best deal possible for their shareholders.

But Northumbrian Water, since its return from French ownership, has always made a point of championing the public interest too. See what Southern Cross Care Homes has been reduced to. Its financial distress has been humiliating, the public thrown into anxieties and concerns, partly because Blackstone, the US equity firm, was able to come in and make £1bn from buying and selling it again.

Water works aren’t care homes though care homes can sometimes bring on the water works. One day we’re going to realise that flogging off strategic assets like utilities and transport totally to Johnny Foreigner doesn’t serve our interests long term.

>> Back to square one It was the oddest shaped visiting card to be thrust in my hand for some time – a tiny square, in fact. Only when I read it did the penny drop: Square One Law. Thus the enterprising Newcastle lawyer Ian

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Gilthorpe – ex-Muckle, ex-Eversheds – announces his new legal practice with panache. He and fellow commercial practitioner Alan Fletcher – son of the former Newcastle United chairman Freddie Fletcher – cleared their desks together at Eversheds to embark on this venture.

Why the square? “Because we listened to what clients want from legal services and used the findings to start from square one.”

>> Chequemate Banks have failed again and I’m delighted. This time they’re unable to suggest a practical alternative to cheque payments, which they want to phase out.

It suits their profits rather than their customers’ convenience, of course, to contemplate that.

Cheques for us are quicker to write out than making payments online. Many folk anyway still abhor banking online, which they either distrust (with good reason), don’t understand, or just get frustrated with. Cheques do occasionally disappear in the post. But if they are being stolen it doesn’t mean your entire bank account will be cleaned out, or your personal details spread around the world.

The banks have been told officially to retain the cheque for some time yet.

>> They care Unknown to us during BQ’s Live Debate on Sunderland, Robert Oakeshott, champion of worker co-ops, had just died. In 1972 he had founded a builders’ co-op to upgrade Sunderland council housing. That sank under spending cuts. But the wife of one builder, Margaret Elliot, set up her own care workers’ co-op. As the debate relates, it prospers – a fitting tribute to Oakeshott’s principles.

>> Watch it!

Wouldn’t like to be the shopkeeper that got on the wrong side of the Daily Telegraph’s new retail editor. His name is Harry Wallop.

SUMMER 11

One of only 11 areas awarded an Enterprise Zone in the 2011 Budget; plans to regenerate the Tees Valley are the most innovative yet and reflect the pioneering nature of Tees Valley Unlimited and the unique resources available across the sub region.

ENTERPRISING VISION FOR TEES VALLEY

T

he purpose of the Enterprise Zone is to stimulate business and job growth in the private sector by concentrating on the 2 opportunities offered by the priority 9 sectors of the local economy.

Under the Enterprise Zone umbrella, a number of HARTLEPOOL Tees Valley sites would be designated which have the potential to create up to 43,000 new jobs, 1,250 new businesses and generate over £4bn worth of capital investment over the next 25 years.

1 Each site will benefit from one of three key 14 Enterprise Zone enhancements - Business Rate 10 Discount, Capital Allowances and Tax Increment Financing (TIF) - and meet the sub-region’s key economic strategies of promoting the area’s18 industrial base and diversifying the economy by 12 7 21 supporting the new digital sector.16 15 22 20 Under the Business Rate Discount24 proposals, sites 11 4 19 17 23 across the five boroughs are all being put forward.

3 S T O C K T OCollectively N O N T E E they S will cover 170 hectares and are worth up6 to £275,000 in business rate relief per business over a five-year period.

M I D DThe L E Sdiscount BROUGH subsidised by Government is then retained by Tees Valley Unlimited and the local authorities to reinvest locally.

Further sites along the North and South Tees Corridor have been identified to benefit from Capital Allowance Enhancement. These larger sites will cover 679 hectares and if the bid is successful, will provide financial assistance for companies to N buy plant and machinery, making the area even more attractive for inward investment and occupation by major industrial enterprises.

In addition, the proposals submitted to the Government last month seek approval for six TIF areas across 244 hectares allowing growth in business rates to fund current infrastructure improvements and is a method regularly used in the United States.

Stephen Catchpole, Tees Valley Unlimited’s Managing Director said: “Securing Enterprise Zone status was a massive boost for this area and presents a real opportunity

sty’s Stationary Office (HMSO). Crown copyright. uaranteed.

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COMPANY PROFILE

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Prairie Site South Bank Wharf Billingham North Billingham South Billingham Reach Port Clarence

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Tees Valley Tees ValleyEnterprize EnterprizeZone Zone on behalf of Tees Valley Unlimited

Note:- Reproduced from the Ordnance Survey Map with the permission of the Controller of Her Majesty’s Stationary Office (HMSO). Crown copyright.

Published for the purposes of identification only and although believed to be correct accuracy is not guaranteed.

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to secure economic growth and prosperity for Tees Valley.

“I believe that we have produced a proposal that is exciting, innovative and will have a transformational affect upon the area’s future Locations economicSite prospects, particularly in our industrial heartland on Teesside.

“We will continue to liaise closely with stakeholders, partner agencies, businesses and local authorities as the Enterprise Zone proposals progress through discussions with the government.”

Tees Valley Unlimited has been working closely with key partners and property experts Savills to identify suitable sites for the Enterprise Zone status.

John Adlen, Director of Development at Savills, said: “The process we’ve gone through in identifying the drawing

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sites has been a thorough one using Tees Valley Unlimited’s Statement of Ambition together with other key factors such as deliverability as criteria.

“We’re confident the proposals will bring maximum reward to the area, supporting growth at all levels.”

A decision from Government is expected this summer. checked by

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Copyright Savills (L&P) Ltd.

Further information on Tees Valley Unlimited and its activities please visit www.teesvalleyunlimited-investment.co.uk

BUSINESS QUARTER | SUMMER 11

Prairie Site South Bank Wharf Billingham North Billingham South Billingham Reach Port Clarence

EVENTS

SUMMER 11

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: b.g.nicholls@btinternet.com The diary is updated daily online at www.nebusinessguide.co.uk

AUGUST

21 Gearing up for Agency Workers’ Regulations, EEF workshop, EEF House, Gateshead. Contact: www.eef.org.uk/event/current

2 Keep your Business Fighting Fit, BE-NE workshop, with Maureen Lindberg, director of Professional People Management, Longhirst Hall, Morpeth (8.30am).

Contact: www.eventsnortheast.co.uk/kybff

21 South Tyneside Manufacturing Forum, guest speakers, Bede’s World, Jarrow. (noon). Contact: John Wood, tel 0191 427 2324. john.wood@st-mf.co.uk

2 The Association of Women in Property meet, Nions, The Gate, Newcastle (12.0).

Contact: Jenny Graham, tel 0191 3016 497 3 AWC Insurance Business Referral Organisation Network, O’Grady’s Hotel, Redcar (6.30am). Contact: tel 01642 492 776 3 Keep your Business Fighting Fit, BE-NE workshop with Maureen Lindberg, director of Professional People Management, Beamish Hall Hotel, Stanley (8.30am).

Contact: www.eventsnortheast.co.uk/kybff 4 NECC Human Resources Seminar, Disciplinary Procedures, Aykley Heads, Durham (9.30am). Contact: www.necc.co.uk 4 Marketing Support Network, Saltburn Wellbeing Centre (9.30am).

Contact: sara@pearsonmarketing.co.uk 8 to 10 NOF Energy Visit to the growing renewables industry in Northern Ireland. Contact: Kristie Leng, tel 0191 384 64 64, kleng@nofenergy.co.uk 10 ICE NE, Tea at the Transporter, Middlesbrough. Contact: Irene.hurley@ice.org.uk, tel 0191 261 1850.

17 AWC Insurance Business Referral Organisation Network, O’Grady’s Hotel, Redcar (6.30am). Contact: tel 01642 492 776 22 Introduction to Coaching and Mentoring, Grosvenor House, Front Street, Monkseaton (1.30pm). Contact: info@lighthouseknowledge.co.uk 31 Deadline to join North East trade mission to San Francisco and West Coast (see Oct 30 below)

22 Jackson’s Law Firm, Equality Act, agency workers, TUPE overview and case update, Wynyard Hall, Wynyard (8.30am). Contact: Caroline Allen, tel 0844 855 4111, callen@jacksons-law.com 22 The Entrepreneurs’ Forum Business Breakfast, speaker Spencer Dale, Bank of England chief economist (8am).

Contact: www.entrepreneursforum.net/gathering/booking/ 23 Time Management, workshop, Grosvenor House, Front Street, Monkseaton (1.30pm). Contact: info@lighthouseknowledge.co.uk 26 Marketing Hot Topics, CIM North East event, speaker Thomas Brown, Newcastle University Business School (12.0). Contact: cimevents@cim.co.uk 26 Customer Service Skills, workshop, Grosvenor House, Front Street, Monkseaton (1.30pm). Contact: info@lighthouseknowledge.co.uk 26 Delivery of Physical Intervention Training, approved security industry workshop (9am). Contact: training@kdkerrassociates.com 27 Employment Law Update, EEF seminar, EEF House, Gateshead.

Contact: www.eef.org.uk/event/current 27 Create, Innovate and Protect, IP workshop with CIPA, ITMA and Companies House. Centre for Life, Newcastle (8.30am). Contact: www.ipo.gov.uk 27 ICAEW Northern Region/IoD North East, Director Development Breakfast Seminars: Role of the Chief Executive, Ward Hadaway, Newcastle (7.30am).

Contact: alison.tait@icaew.com, tel 0131 202 1252

SEPTEMBER

28 NSCA, Business Confidence and Economic Review, breakfast briefing, Riverside Stadium, Middlesbrough (12.30). Contact: alison.tait@icaew.com, tel 0131 202 1252

1 Marketing Support Network, Saltburn Wellbeing Centre (9.30am).

Contact: sara@pearsonmarketing.co.uk

29 CBI North East Annual Dinner, Hilton Gateshead (6.30pm).

Contact: Hilary Nichols, tel 0191 255 4413, hilary.nichols@cbi.org.uk

3,4 The Chinese Capital Market, Durham University Business School conference (9am). Speakers including Jun Qian, Boston College and Wharton Financial Institutions Centre, and Huiyao Wang, Harvard University and the Centre for China and Globalisation. Contact: www.dur.ac.uk/dbs/news

OCTOBER

7 Connecting with Generation Y, Durham and Tees Valley CIM event, Durham University Business School (6pm). Contact: cimevents@cim.co.uk 7 NSCA, Finance Act 2011, Ramside Hall, Durham (1.30pm).

Contact: marie.rice@icaew.com, tel 0191 300 0532 8 BQ Magazine Charity Golf Day & BBQ, Close House Hotel and Golf (10.00am).

Contact: bryan@room501.co.uk, tel 0191 537 5720 13 CBI North East Regional Council, venue tbc (9.30am). Contact: Carole Coulton, tel 0191 255 4410, carole.coulton@cbi.org.uk 13 NSCA, Business Confidence and Economic Review, breakfast briefing, Jesmond Dene House Hotel, Newcastle (7.45am). Contact: alison.tait@icaew.com, tel 0131 202 1252 14 NSCA, Improving Time and Self Management, Ramside Hall, Durham (9.30am).

Contact: alison.tait@icaew.com, tel 0131 202 1252.

Also, Building Influence, Improving Networking and Personal Marketing (1.30pm). Same venue and contact 15 The Entrepreneurs’ Forum, Sixth Chairman’s Dinner, Close House Hotel, Heddon on the Wall (6.45pm). Contact: tel 0870 850 2233 21 to 23 Win Your Share of the Silver Pound, marketing to older consumers, seminar with Julian Healey, Springtide Marketing Consultancy, formerly head of marketing at Saga, Newcastle University Business School (9.30am).

Contact: www.ncl.ac.uk/nubs’about/events/item

BUSINESS QUARTER | SUMMER 11

5 NSCA, The Future of UK GAAP – the FRSME in Practice, Ramside Hall, Durham (9.30am). Contact: marie.rice@icaew.com, tel 0191 300 0532.

Also, A Practical Approach to Group Audits (1.30pm), same venue, same contact 7, 8 ICAEW, Peebles Tax Weekend Conference. Contact: alison.tait@icaew.com, tel 0131 202 252 11 How Radio and Newspaper Promotions are Still Relevant in the Internet Age, Durham Tees Valley CIM discussion, with Julian Hotchkiss and Malcolm Warne. CIM Durham Tees Valley event, Blackwell Grange Hotel, Darlington (8am).

Contact: cimevents@cim.co.uk 11 NSCA, Leadership for Recovery, Radisson Blu Hotel, Durham (9.30am).

Contact: marie.Rice@icaew.com, tel 0191 300 0532 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: 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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'No Mr Bond, I expect you to renew'...

For several hundred years inventors and scientists have dreamed wistfully of creating a perpetual motion machine. The theory being that it is possible to design a machine that creates more energy than it uses, and therefore runs perpetually. Such attempts are normally characterised by a strange combination of rolling steel balls and spinning wheels cobbled together in a half baked attempt to harness gravity and convert it into useable energy.

It is obvious that none of these hopeful inventors have ever been parents otherwise they would have known that the secret to guaranteeing perpetual motion is to simply put a toddler in a barber's chair. Just lashing a few chairs together and harnessing the energy created would make Sellafield seem about as productive as a windmill.

If you could build such a machine (the perpetual motion one, not the child slavery barber chair) then you would also solve the world's energy crisis at a stroke and a Nobel prize would surely follow. But before you dash off to your shed with the kid's marbles,a colander and some four-by-two, it’s probably worth mentioning that it can’t be done. If you do actually succeed then you will likely be ran out of town by villagers carrying pitchforks, convinced that you are in league with Lucifer.

The 17th century mathematician Blaise Pascal spent an awful lot of time trying to create a perpetual motion machine, in between developing mathematical theories such as Pascal’s triangle, much to the dismay of maths students ever since.

Despite the fruitless folly of his pursuit of perpetual energy, one of his attempted inventions turned into something that is still very popular today. He created a spinning wheel with a groove around its perimeter in which a ball-bearing could be spun in the opposite direction. The idea being that each would power the other and it would run forever. It didn’t. Time after time the ball lost momentum, fell off the wheel and settled around its spindle, which just happened to have grooved notches in. The dejected Pascal consoled himself by trying to guess which of the notches the ball would eventually fall into; and roulette was born.

The game is simple. A grid with 36 numbered squares is drawn out on a table and you bet your money on which corresponding number you think the ball will land in on the roulette wheel. Guess correctly and you win 35 times the amount of your stake. That means that statistically, for every £36 you bet, you will win £35; which is the definition of having the odds stacked against you. A

bit like an argument with the wife; the longer that you keep going for, the more it will cost you in the long run.

When it comes to a business model, the casino is no different to an insurance company. It is the art of calculating the odds of an event happening under a certain set of circumstances that dictates whether you make a profit or loss. Where it is different is that roulette is a game immersed in glitz and glamour and a tool of seduction for British Secret Agents whilst insurance is just plain dull. James Bond may not have had the same allure with the ladies if he invited them to spend his money by completing his home insurance form.

There is one occasion when insurance isn’t dull though.

That’s the day that you need to claim. Immediately it becomes the single most exciting thing in your life and you become the king of the small print, desperately scouring the policy conditions hoping beyond all hope that your particular calamity is covered and finding out, invariably, that you’re not covered for what you thought you were covered for.

This scenario is inevitable as long as human nature dictates that when we purchase our policy we want it to be the cheapest possible and when we claim on the policy we want it to be the best. It is much like when the kleptomaniac married the police informant. It was never going to end well.

The way we view insurance has also changed with the advent of price comparison websites. Now, we can compare quotes at the click of a button and price is everything. That is why they are called price comparison sites and not best policy comparison sites. Lets face it; who ever clicks on anything but the lowest premium?

Consequently, in the modern world insurers are all desperate to provide the lowest quote in order to get to the top of the list. The problem is that no matter what price they charge, it doesn’t change the likelihood of a claim happening. Whether you pay £100 or £1,000 for your premium won’t change the underlying odds of whether you will die, crash your car or get burgled.

The casinos had the same problem with roulette. No matter how good or bad the casino was, the profit level was dictated by the odds. For every £36 staked by the player the casino stood to make £1, which worked out about a 2.3% margin.

And so they decided to change the odds by adding another number to the board. Meaning that for every £37 staked, the hapless punter would win £35. But, instead of adding the number 37, they added a zero. The

reason being, that if you ask people how many numbers there are on a roulette table, most will say 36. In their mind, they then think of the odds being 1 in 36 instead of 1 in 37 (including the zero). This minor change doubled the casino’s profit margin to over 5%.

Their spiritual brothers in the insurance industry do not have the luxury of changing the odds of an event happening that they have insured against. They cannot just add another number to the table. So if they need to reduce their price to ensure they are top of the ‘best buy’ tables and they cannot reduce the odds of a claim being made, then the only place they have left to go is.....reduce the number of payouts made.

And so the games begin, increasing the excess on motor policies which pretty much rules out any claim other than a total write-off, tightening the definitions of health policy conditions and a personal favourite, the flogging of Reviewable Rates on term life assurance policies.

This is where the premium they quote, to get to the top of the tables,is only fixed for the first five years of your life insurance plan. After that they can increase it each year to whatever they like. So, when you get older, and more likely to claim, they increase the premiums to a level that is obviously unaffordable and you have no option but to cancel it. They get to keep the premiums you paid when you were young and healthy and you get left without any cover when you actually need it. To check your policy, look in the schedule for the premium and if it says it is ‘guaranteed' then that is good. If it says 'guaranteed for 5 years' then that is not good.

It’s a bit like the budget airlines that start off with a price so low that you wouldn’t think a pigeon could fly to Spain for, yet by the time you have finished your journey you realise that you could have chartered Air Force One for what it actually cost you in luxurious add ons - like a seat... and the fuel.

So, for all the benefits that comparison sites bring, maybe the 19th century architect William Ruskin was referring to insurance when he noted that ‘There is nothing in this world that some man cannot make a little worse, and sell a little cheaper, and those who consider price only are this man’s lawful prey’.

Independent Financial Advisers Wealth Management Contact us for a free no obligation chat.We’re always glad you called!

Teesside 01642 525511 | Newcastle 0191 3017218

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Employee Benefit Schemes Company Pensions

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The Financial Services Authority does not regulate advice on will writing, trusts, taxation and some forms of mortgages. Any opinions expressed in this promotion are not intended as individual recommendations. You should take independent financial advice before making any personal financial decisions.

The new Audi A6.

Enhanced driving.

This is what we mean by enhanced driving; A lightweight design, fuel efficient engines, advanced driver assistance and a high level of technology as standard.

The new Audi A6 includes intuitive options that help it make light work of any journey, like night vision assistant, head-up display, Wi-Fi and the MMI Touch System.

There's a choice of innovative engines: 3.0TDI, 3.0TFSI and the economical 2.0TDI, which can emit just 129g/km of CO2 and achieve a remarkable 57.6mpg.

To arrange a test drive contact your nearest North East Audi Centre or visit www.northeastaudi.co.uk

Available from only £399 per month.

Newcastle Audi

Tyneside Audi

Wearside Audi

Teesside Audi

Scotswood Road, Newcastle upon Tyne NE4 7YW. Tel: 0843 248 7228 (local rate)

Silverlink Park, Wallsend, Newcastle upon Tyne NE28 9NT. Tel: 0843 248 7218 (local rate)

Stadium Way (Opposite Stadium of Light), Sunderland SR5 1AT. Tel: 0843 248 7248 (local rate)

Brooklime Avenue, Preston Farm, Stockton on Tees TS18 3UR. Tel: 0843 248 7238 (local rate)

e-mail: enquiries@wearsideaudi.com www.wearsideaudi.com

e-mail: enquiries@teessideaudi.com www.teessideaudi.com

e-mail: enquiries@newcastleaudi.com www.newcastleaudi.com

e-mail: enquiries@tynesideaudi.com www.tynesideaudi.com

Business users only. Typical example: The New Audi A6 Saloon 2.0 TDI SE (177PS) Manual. 3-year contract hire, 35 monthly rentals of £399.00 (plus VAT), initial deposit £1,197.00 (plus VAT), 10,000 miles per annum, excess mileage 6p per mile (plus VAT). Further charges may be payable when vehicle is returned. Indemnities may be required. Subject to status. Available to over 18s from participating North East Audi Centres only for vehicles ordered before 30th September 2011 and delivered by 31th December 2011 (subject to availability). Offer may be varied or withdrawn at any time. Specification correct at time of publication. Prices quoted and examples shown are correct at time of publication (April/August 2011) and do not take into account any variation to government taxes or charges arising after the date of publication. Terms and conditions apply. Audi Finance, Freepost Audi Finance. Model shown for illustration purposes only.

Official fuel consumption figures for the Audi A6 range in mpg (l/100km): Urban 26.2 (10.8) - 47.1 (6.0), Extra Urban 42.8 (6.6) - 64.2 (4.4), Combined 34.4 (8.2) - 57.6 (4.9). CO2 emissions 190 - 129 g/km.