Blue Autumn Ltd

Workwear supplier Blue Autumn Ltd suffered a serious setback three years ago when it lost its biggest customer. But now the business is bouncing back.

James Morley knows all about the ups and downs of life as an entrepreneur running a small business. As the owner and Managing Director of Blue Autumn Ltd, a Northern Ireland-based supplier of nurses' uniforms, he initially battled hard to establish and grow his business, only to see it dragged down by the loss of a key customer and a long-running legal dispute. Now, after a period of retrenchment, the company has recovered from the setback and is back on the path to growth.

Mr Morley founded Blue Autumn in 1996. Prior to setting up the company he had gained experience in Northern Ireland's textiles industry, which, ironically, he hadn't enjoyed. "I worked for a large clothing manufacturer in Belfast doing things like time and motion studies for the production process," he says. "I stuck with it for six years, but it was deadly dull and I vowed never to work in textiles again!"

Having left this tedious job, Mr Morley spent a year selling janitorial products to nursing homes. "They kept asking if I could supply them with uniforms for the nurses," he says. And so the idea for Blue Autumn was born.

Mr Morley was just 26 years old at the time. "I was young and stupid!" he jokes. "I didn't have any commitments, so I was willing to have a go." At that stage, he didn't have much by way of advice or business support either. "I just muddled through," he admits.

Even so, he "muddled through" pretty effectively, steadily building up his clientele of local nursing homes. In 2004, he switched production to a joint venture company he set up in Romania in a bold, but successful bid to reduce manufacturing costs. At its peak, Blue Autumn was supplying some 500 homes and had an annual turnover of about £550,000. Its future seemed assured.

But there lurked a major flaw in the company's business model – many of the homes belonged to just one group, Four Seasons Health Care Ltd. Blue Autumn had happily ‘piggy-backed' on Four Season's rapid growth in Northern Ireland until, three years ago, the care home operator switched its clothing orders to a lower-cost supplier. At a stroke, Blue Autumn lost more than half its business. Worse still, it was left carrying stock and also struggled to collect outstanding payments from the company.

Despite the setback of losing its biggest customer, Blue Autumn managed to survive the crisis and continues to operate successfully, albeit in a greatly slimmed down form, with fewer than 150 nursing home customers. But Mr Morley is far from downhearted. "We're more comfortable now," he says. "For 10 years, half of my business went to just one customer – I had to jump when they said jump, hold a lot of stock, cut my prices to the bone and put up with late payment. Now, we've restructured our finance – switching from invoice discounting back to an overdraft – cut our stock levels and reduced our number of employees."

The company now employs just six people in Northern Ireland and its turnover is similarly modest – at around £250,000 a year – "but now it comes from a solid, varied client base," says Mr Morley. "We have more individual homes and small groups among our clients, better margins and improved cashflow. We also have a better credit rating now."

As for the future, with the recession weakening some of its competitors, Blue Autumn has started picking up new customers and Mr Morley, though older and wiser, remains as enterprising as when he started: "After 15 years we're still very much in business and we're looking to grow again this year," he says confidently.

Blue Autumn Ltd has benefited in particular from the Forum's robust lobbying over the issue of late payment.

Mr Morley is one entrepreneur who has refused to take late payment ‘lying down'. He not only chased the payments owed to his firm by Four Seasons Healthcare, but also asked it and other customers that had paid late over the previous six years for the interest and the administration fee owed under the Late Payment of Commercial Debts (Interest) Act, which the Forum had been instrumental in getting passed into law. He even took several former customers, including Four Seasons, to court.

The case against Four Seasons is still pending after more than two years. But Mr Morley is thankful for the publicity gained by the Forum for the wrongs he believes his company has suffered. (It should be noted that Four Seasons has said it will "strenuously" defend the claim against it and that in its view the action raised by Blue Autumn against it is "without merit").

At various other times the Forum has been on hand to offer Mr Morley business advice when needed. "I received a vital piece of advice on an insurance issue which no-one here in Northern Ireland was able to give me," he says. "It really saved my bacon."

He has also made use of the Forum's Practical Health and Safety package and the member helpline. "I'm very supportive of the Forum's ethos of helping small businesses and membership has proved to be excellent value for money," he says.

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