BUCKING THE CREDIT CRUNCH

There’s no doubt that times are tough out there in 2009 and some of our members are really feeling the pinch. However, as an antidote to the much publicised doom and gloom, I thought it would be useful to highlight a few NDI members who are bucking the trend and investing for the future. There may be useful lessons in how they are managing it!

By Chris Jenkinson - NDI Sector Business Manager (Republished from the NDI Annual Review 2009)

Over the last 18 months, PP Plasma, based in Manchester, has invested some £1.4 million in two new lasers and one new plasma cutting machine to meet growing demand. Their success appears to be down to very prudent cash flow management and a strong order book from a diverse customer base, including oil and gas, pharmaceutical, aerospace, defence and rail. Their investment was funded from operating reserves, which avoided the issues of scarcity of institutional finance. The next phase of investment and expansion is now being actively pursued with outline planning applications in and around £1m being directed at moving to larger new facilities.

Merc Engineering from Barrowford, Lancashire, are more than keeping their head above water during the recession and are aggressively pursuing larger new contracts. Their current facilities are utilised to the maximum and they are looking for more space in their former mill building for expansion. They feel that the banks will look favourably on them if this expansion is linked to an impending contract win. It is often the case that to satisfy a large contract, new equipment such as CNC machines will be required. Merc feels that customers understand that and banks would feel able to finance expansion on the basis of an assured new contract.

In other areas of the UK, and the NDI membership, Barker Collins Engineering of Sheffield invested in new facilities a year ago, relocating their machine shop from their cramped facilities in the centre of Sheffield to modern purpose built units close to the M1. On the other side of the Pennines, Oldham Engineering have also embarked on a comprehensive change programme introducing process improvement, modernising working practices and significant investment in their CNC capabilities.

Let’s hope the green shoots of recovery are starting to happen and these NDI members will be well placed to capitalise.