Transcript - Inspire EO

@InspireEO
Andrew Murphy
John Lewis Partnership
@InspireEO
Sir Charlie Mayfield
John Lewis Partnership
@InspireEO
Dennis Overton
Aquascot
Aquascot- a Highland-based
sustainable Seafood business
Then and now
• 1987
• 2015
Began life as a 2 person
start up:
- New industry
- High barriers to entryonly 4 countries can
farm salmon
- Food: the new
medicine
-170 partner-employees
- 2 production plants in
Alness, Ross-shire
- £45m turn over last
year
- 12% UK fresh salmon
market share
The March 1993 phone call
…..start of a remarkable journey
Power of the well-run firm
to contribute
to the public good
Becoming Employee Owned:
an 8 year journey, 2008-2016
@InspireEO
Dick Philbrick
Clansman Dynamics
Started 1994
Employee Owned 2009-
• Foundry Manipulators
• Forge Robot
• 2009 c. € 8.5m sales
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•
•
Good order book
95% exports
Sales in 30 countries
30 employees
• SUCCESSION?????
• SUCCESSION OPTIONS
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•
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•
Trade sale
Sale to competitors
MBO
EBO
North Korea
GDP $1800 ( est)
South Korea
GDP $38,000
STRUCTURE HAS AN EFFECT OVER 50 YEARS
Orders August
( less hammers, spares)
Doncasters
C620
UK
€
199,000
FuWa
C1210
Ch
€
203,000
Tongrun
C4010
Ch
€
310,000
Componenta
PB80
Tu
€
112,400
Fiday Gestion
C620
Fr
€
182,000
Busch Raba
C620
Hu
€
184,000
1,190,40
Why So Few Companies Employee Owned?
Professional advisers
Trade unions
Lack of knowledge
Business seller gets less
Not even considered at Strathclyde Business School!!
Ove Arup, Carl Zeiss, John Lewis, Publix, SAIC, Floturn ... Long term
businesses
2014-15 performance
SALES
Machine sales 7429.9
Cannons
548.7
Spares sales 2359.8
Wedges
0.0
Other income
245.4
MATERIAL COSTS Machines
Cannons
Spares
Wedges
Other Income
Gross Profit
OVERHEADS
Commissions
538.8
Wages & Salaries
2466.0
10583.8
Consumables
107.5
Freight
68.2
4060.3
Marketing costs
23.0
273.9
Building Costs
303.0
1112.9
Travel Expenses
200.0
0.0
Other Operating expenses 246.7
0.0
3953.2
5447.1
5136.7
Operating Profit
1184
Projected Operating Performance 2015 - 2016
Orders Received
Sales
Yangzhou
€ 268,000
Durametal
Sales
£K
Material
196
16
100
80
€ 205,000
150
11
86
53
VHM
€ 348,000
262
19
151
92
Dalian Wanyou
€ 358,000
269
19
125
125
Elecmetal
€ 743,000
546
29
283
234
Urbina
€ 226,000
170
15
85
70
Forgital
€ 340,000
248
23
131
94
NWS
€ 165,000
120
11
63
46
US Pipe
$52,760
34
3
17
14
Guandong Fuwa
€ 200,000
146
13
75
58
Doncasters
€ 199,300
145
0
75
70
Changsu Tongrun
€ 310,000
226
20
115
91
Busch Hungaria
€ 180,500
135
12
82
41
1336
116
640
580
3983
307
2028
1648
Spares projected
Totals
Overheads
LOSS
Commission
Balance of full year overheads
Projected Loss to 31st March
2016…..
1758
546
Profit distribution - how??.
Estimated profit
£1,600,000
Corporation Tax
£ 448,000
Loan repayment
?
Dividend (how to split with bonus)
?
Bonus to All ( on what basis?)
?
Capital spend
?
R and D
?
Balance sheet increase, ( rainy day)
?
Apples from the tree of EO
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Growing confidence
Bracing telling of the truth
Reduced supervision
Realism about wages, market, quality,
customers, etc
• 2014 c. € 14.5m sales
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•
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Less good order book
95% exports
Sales in 42 countries
42 employees
EO firmly established
Conclusion
Too many statements about doing more manufacturing and
little about how – EO is great basis
form of ownership for solid, long term, organic
growth...............engages people
very positive reaction from agents and customers
Its good for people…..’wellbeing,’ fosters a little
entrepreneurialism
form of ownership is another tool that will bring competitive
advantage, 1%, 10% ………….doesn’t matter
‘Glues’ the business to Scotland
@InspireEO
John Swinney
Deputy First Minister &
Cabinet Secretary for Finance,
Constitution & Economy
@InspireEO
Dr Lena Wilson CBE
Scottish Enterprise
@InspireEO
Troubleshooting
Your Questions Answered
@InspireEO
Alison Rose
Royal Bank of Scotland
@InspireEO
Thank You
@InspireEO