Applied Metal Technology & G&D Enterprises

Ian Taylor, MD of Applied Metal Technology

Are the UK's small manufacturers poised to help lift the UK out of recession? We spoke to two of the Forum's members – two traditional ‘metal-bashers'.

Much has been made of the importance of manufacturing to the UK's recovery from recession. Contrary to popular myth, the UK still has a sizeable and vibrant manufacturing sector that makes up about 12% of GDP. This compares favourably with financial services, for example, at a mere 8%. Many smaller manufacturers are versatile, innovative and resilient. They are keen to play their part in the recovery, but it won't be easy.

Manufacturing mettle

Ian Taylor, Managing Director of Leeds-based manufacturer Applied Metal Technology (AMT), sums up the challenge succinctly: "You need customers."

Mr Taylor is sceptical that manufacturing can lead the UK out of recession. "I just laughed when I heard that," he says. "Unless we've got demand for our products, I don't see how that can happen."

In common with many other firms, AMT faces reduced demand in several of its key markets. The company is a sub-contractor, making a diverse range of precision sheet metal components that form part of larger products, including displays for retailers such as Debenhams and Next, junctions, brackets and shelving for the telecoms industry, and braking systems for trains.

"... A lot of manufacturers will do OK in this recession because we're battle-hardened.

- FPB member Ian Taylor,

Applied Metal Technology

"We're part of a bigger supply chain," says Mr Taylor. "There's demand in some sectors – rail investment might trickle through – but recovery will be patchy."

Mr Taylor, a sheet metal worker by trade, started AMT five years ago when his previous employer went into liquidation. He describes the company, which has a turnover of around £1.25m and employs 16 people, as ‘punching above our weight' before the recession, but business is now down by around 30% on a year ago.

But he is far from pessimistic. "Things have levelled off in the last few months and even shown a small increase," he says. "We're still profitable and we haven't had to make any redundancies yet.

"A lot of manufacturers will do OK in this recession because we're battle-hardened. Everything is run tightly – we don't have company cars or secretaries and we pay for our own coffee. We've been up against it for 20 years and have had to work really, really hard."

Counting on quality

Such resilience in hard times is equally evident at G&D Enterprises, a Huddersfield-based bespoke sheet metal manufacturer that is also doggedly resisting the downturn.

The company's core products include seats and bins for local authorities, and it is feeling the effects of public sector budget cuts as councils buy cheaper, lower quality products or put replacements on hold. "We used to get three or four faxes a day with new orders, but the fax machine is now conspicuous by its silence," says G&D's Company Secretary, Denise Collier.

Whilst she acknowledges that some manufacturers are doing well, Mrs Collier finds it hard to see the sector leading economic recovery. "So many companies are having to reduce working time, make redundancies – or even go under," she says. "We took a big dive in December and January, but things have pulled up since then and we've seen an increase in work in the last month."

G&D is compensating for lost business by developing new products and opening up new markets through persistent targeting. "We are also taking on another unit to expand our business to offer different services such as powder coating," says Mrs Collier.

"... We pride ourselves on quality and value for money – and a lot of customers get referred to us.

- FPB member Denise Collier,

G&D Enterprises

The company, which has an annual turnover of around £750,000, has had to make only one redundancy and now employs 17 people. While she can't rule out having to make more cuts, Mrs Collier is banking on the company's excellent reputation to carry it through. "We pride ourselves on quality and value for money – and a lot of customers get referred to us," she says.

"We are profitable, but the marketplace is a lot more difficult than it was, with some competitors working below viability to weather this recession. We've just completed our 9th year – let's just say that the 10th is going to be interesting."

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