Magic Boot

Not sure what sort of replies to expect from Scoobynet but the idea seemed harmless enough.

I run a small Injection Moulded Medical Device manufacturing business inherited from my grandfather (est. 1975). My career started way back in 1990 and I have gradually been given greater responsibility culminating in the reigns being handed over 2 years ago. Unfortunately, as most of you will be aware, successive governments including to a greater degree the current mob have destroyed many areas of manufacturing in this country . I won't dwell on how strongly I feel about this, but lets just say that when a DTI official advises you to close down the manufacturing side of your business and simply import and distribute, I want to break something!!!! The levels of red tape and legislation are simply ridiculous.

Being a very stubborn and dogged individual I have dug in my heals and refused to give in. We are still trading on a break-even basis and currently employ 7 full time staff. However, for all my efforts, exploring new products and additional automation of processes, it seems that every alley I go up is a blind one. It is neigh on impossible to get near to the prices of goods imported from Eastern Europe and the Far East. Our only saving grace is the fact that we are able to guarantee quality and delivery times, something that is a common problem with overseas trade. I am also aware that this will not always be the case!! We have half a dozen loyal customers who have traded with us for up to 20 years and continue at a reduced purchase order rate. Turnover is circa £200k.

Fortunately the business is cash rich. We own outright our rural based property and all our machinery etc. Plus we have a savings cash reserve of £250k +.

I am currently suffering many sleepless nights thinking up schemes for developing the business both in its current field and totally new areas. As you can imagine, my dilemma is a major one with the added factor that I have strong morals and a LARGE conscience. I do not want to upset other family members with my decision.

Below are a few ideas, some minor, some major!! Your opinions may help break down the fog in my mind. Also, please be assured that I will not hold any of you directly responsible for events transpiring as a result of my actions.

1. Persevere with current business hoping to develop new products and customer base, although bleak outlook.

2. Take a gamble and develop products for another market, baby & toddler development devices and start selling through mail order magazine adverts with a view to approaching Mothercare etc. in future.

3. As premises are beautifully located in an affluent rural village, (old school building), convert into gymnasium and/or exclusive heath club, spa. Cost involved etc.?

4. Attempt to sell/merge business with a larger Medical Company. How????

5. Close down the business and convert premises into residential property or properties.

6. Close down the business and sell off the property then start on another venture.

7. Any other bright ideas

I really want to get my teeth into something and feel I’m getting somewhere enjoying my day job again. What I don't want is to sit back and do nothing living off my inherited wealth. Well not for a few years anyway!!!

Your views are sure to make entertaining reading. Thanks for taking time out to read.

NotoriousREV

My opinion is that UK manufacturers will only succeed in a niche market place, forget mass production you can't compete with countries where the annual wage is less than you pay your guys a month.

I'd look into producing small runs of specialised objects, especially if you can turn stuff around quickly.

Easier said than done, though, obviously.

Magic Boot

Cheers for the 1 reply.

I agree about the niche market products, this is where the baby products fit in, have you seen the price of a dummy!!!! I could make that for 25p.

I have ideas for totally new products which i'm obviously not going to discuss on here due to patent prior disclosure. If i'm going in that direction it would cost approx. £50k to prepare moulds and advertise the products. Should I gamble in this direction though? Obviously i'm not after a deffinative answer just am opinion of what others would do.

Cheers.

russell hayward

Carrying on as you are is the worst thing you can do.

Firstly, I would get someone to analyse your overheads, as despite what you may think, I guarantee savings can be made somewhere. This may or may not be material, but if you have seven staff on only a £200k turnover, I think something could be done.

You must either develop products in your current line of business and become a niche producer, as mentioned above. However, this has drawbacks as it is only matter of time before the "cheapo" competition catches up with you and unless you have another new product sat on the shelf ready to go, you are back to square one.

If you diversify, surely you need to do the research into the market before you go blowing £50k, and see if anyone will buy your new product(s) ?? Only then can you make an informed decision.

I wouldn't be too keen on the health club idea, as it's hard enough to turn profit on those, and even harder if you don't really know what you are doing (no offence)!

Can you get planning on your site ? How big is it ? Is the current building listed ?

As you have a big pot of money, it would be very easy for you to borrow money and do some prpoerty development. You could start with your own site and see how you got on.

fast bloke

talk to your prospective clients before you blow the 50k.

Can you make a prototype, show it to them and find out if they would buy based on a price. Once you have enough possibles, blow the 50k and find out.

The main problem is that you will probably come up with 20 brilliant ideas before you hit the one that becomes 'dyson.' You can't throw away a million quid finding out which is the right one

paulr

6.

Why,because to ask for this sort of advice here you must be either desperate,or have no clue about how to run a business.

fast bloke

Paul - do you not think with 30000 members someone may have a useful idea?

Maybe you are in the fortunate position that you know everything

dharbige

How's about using your knowledge of the manufacturing process to come up with a new improved way of getting the molds made?
Find a way to do it for 25K, then patent the process.

And give me a cut!

eClaire

Hey Magic boot

Have you contacted your local Business Link Operater? Find them here www.businesslink.org, there is also a lot of other information on there which may prove useful. Also check out www.sbs.gov.uk.

With regards to the red tape, the government are taking steps to reduce it, if you would like to speak to a human bean about it ring me on 0845 001 0031 (SBS Enquiry Line) Monday morning and I can put you in touch with a man who can! (i don't have his number off hand)

Also, one for your 'ideas' check this webpage out. Research & Development Grant (formerly known as the SMART award). If youre not sure about taking the risks, there are grants available to you for this cause, providing your business meets the criteria.



Hope this is of help

Magic Boot

paulr. WELL DONE, do I know you? ............... didn't think so!!

Everyone else, thanks for your views. The Subaru Community never ceases to amaze me with it's helpfulness from MOST members. I haven't even owned a Subaru in the last 2 years but still stick around for entertainment and advice. As I originally said, I was not sure what to expect from posting on here but thought it may touch a nerve with fellow businessmen who have been at the same crossroads. The local Business Link have had a barage of calls from me but it always seems that we don't quite meet the crieria for funding and are out of the funding areas. It's better if you have zero cash reserves and are on the verge of going under which we are fortunately far from.

I have full confidence in my own abilitly to run a business and want to emulate my grandfathers success. It is actually quite exciting planning the next attack direction, just trying to decide which direction although the fog is starting to lift.

Thanks.

TopBanana

How about producing stuff you can retail direct? Obviously you'll have to worry about packaging etc.

Can you mould poly bushes for cars? You might be able to sell them to people like me - through an online store perhaps.

Scooby-Doo

Nice reply Paulr, you muppet.

What is the size of the property and whats the local housing market like ? 2 developers are desperately trying to buy my parents house in South London which is on a 1/2 to 3/4 acre of land. They have already said they will build 24 homes on the land !!!!! You could make a tidy sum if you can get planning for a housing project and manage the project yourself with a building firm rather than selling the plot to a developer.

paulr

Well done to eclaire for the best reply,get professional advice.