In the early days all of the engineering and manufacturing was sub-contracted as Mike Bailey didn’t have the space to do it himself. But just six months after setting up the business he invited a former colleague to join him and around a year after its creation the company’s products were selling so well the partners moved into a small factory.
Fast forward to the late 1980s and John Bailey joined Setmaster fresh out of college. He helped establish the company’s name as one of the leading manufacturers of collating equipment globally, but then in the mid 1990s, Bailey and the son-in-law of his father’s business partner became second-generation owners of the business.
“For us it was like an arranged marriage,” recalls Bailey. “We didn’t choose each other. We were different people, we were a different age group, different nationalities, different culture and we had different ideas. I offered to buy him out but he didn’t want to do that.
“The only resolution I saw fit at the time – because it was having a damaging effect on Setmaster – was ‘you buy me out for a smaller amount and I can approach any member of staff I want to. I’ll set up my own company and we will fight it out in the open market’.”
Bailey says he had a few crucial things in his favour when he decided to take the decision: he had youth, he believed he was more determined and competent than his rival, plus he had his father, who he invited to join the new company.
“He was ‘Mr Setmaster’,” says Bailey. “The collating guru of the industry and you cannot buy that kind of experience and knowledge. Having his support and advice was quite literally priceless.”
Bailey cherry picked 10 of the best Setmaster workers, which, he says, ripped the heart out of his former business.
“That’s not what I wanted to do,” he explains. “I wanted to buy my partner out. He was in his late 50s at the time and I was in my early 30s, so it just made sense that I could give him a nice sum of money, we could shake hands and everything would be well with the world. He didn’t want to do that so I had no choice, but go down the route I did.”
Bailey and his new team moved to a facility around 45 minutes drive from Setmaster’s factory and immediately started working on a brand new range of collating products.
“There was no point in being a Setmaster MK II, so I said ‘what haven’t we done at Setmaster?’ We were offering the market a wide range of machines, but these were products that we had decided to design and build. So we had a whole bunch of products on the shelf and you could look at the catalogue and try and find a machine that best fit your needs as a customer.”
However, Bailey wanted to offer a more bespoke approach. He also realised there was an opportunity to improve on the Setmaster and target a new audience.
“The Setmaster speed was getting a bit slow so we went about redesigning the drive mechanism so that we could get more speed and that was a radical change in engineering,” he says. “Then we decided that rather than go for a standard product – particularly because we were starting from scratch and from a smaller basis than Setmaster – we would focus on custom builds. That was the trick because custom building leads you into all sorts of weird and wonderful doorways that you never knew existed, and by putting yourself out there and opening yourself up, the market says ‘can you do this and can you do that?’”
Bailey admits that there was nothing particularly revolutionary about the first machine to roll off Col-Tec’s new production line other than the fact that the eight-station B3 format collator was faster than Setmaster products. He also deliberately decided to target B3 rather than A3 because this size machine was more commonly used in Europe.
Although he had left Setmaster behind Bailey didn’t entirely cut off his ties to the business. He was supremely confident that the new Col-Tec products would gain traction in the UK market, but globally the brand was a complete unknown. Hence in the first five or so years of the company’s existence he bought, refurbished and re-sold a lot of used Setmaster machines to overseas customers.
“Because we were Setmaster people originally we were well qualified and able to do a job as good as, and quite frankly better, than the folk left at Setmaster,” says Bailey. “So that was our strategy. Let’s get the new Col-Tec machine well established in the UK, let’s get into the overseas market off the back of the Setmaster brand by selling clients refurbished Setmasters and then over time those refurbished machines would get replaced with new Col-Tec collators. This strategy allowed us to introduce the Col-Tec brand into multiple overseas markets.”
The approach paid off, to the extent that a struggling Setmaster eventually fell into administration in the late 2000s and Bailey was finally able to snap up the business he had originally hankered after. Targeting the customised side of the collating market also worked out. Bailey says the company’s machines are used by a wide range of businesses and market sectors, from POS materials through to companies that wrap tissue around flowers, and although some people choose to buy an off the shelf model, it’s the bespoke machines that have served the business well.
“20 years ago we used to get the comment ‘you’ve only got another five years supplying collators because the market is changing, it’s becoming a paperless world, so you need to think of another product’,” says Bailey. “That would have been true if we had stayed doing what we did 20 years ago, which was supplying collators for business forms for calendars, for booklets and brochures. But today we’re one minute supplying a collator for a special build Braille application, and the next we’re supplying a machine that’s collating a set of sandpaper with different grades of abrasive rub.”
He adds that ultimately he sees the company as a supplier to the printing industry and “allied trades” because some of the customised collating solutions Col-Tec delivers do not involve paper products.
“We say that we are collating specialists as opposed to offering collating machines,” continues Bailey. “It’s in our name – we offer collating technology solutions.”
He admits that some of the customised builds the company has undertaken have at times been daunting, but because Col-Tec has been delivering custom-built models for nearly 20 years, he says that more often than not he can look at a previous job for a different customer and apply those learnings to the new commission.
“So rather than start with a clean sheet of paper these days we are drawing on a previous client’s build for 50% or more of the design that we need. It’s never easy, but it gets easier the longer and the more you do it.”
Bailey says that fundamentally the machines the company manufactures today are similar in many ways to the early iterations. But one model that’s radically different in terms of what it can achieve compared with the company’s original collators is the Smart collator Col-Tec launched around four years ago.
“Historically, whatever you collated, the sequence you were delivering at the end of the collator was repeated,” he explains. “So if you were collating a calendar you would collate January to December with a front and back cover and every set coming off was the same. The difference with the Smart collator is the sequencing of the set coming off the end of the collator can be – at its most extreme – a different set every single cycle of the machine, so no two sets need necessarily be the same.”
Bailey with local MP Desmond Swayne
Going forward he has high hopes for the Smart collator and he’s already working up plans to expand the company’s existing facility in New Milton to accommodate a step up in activity. Today, the business, which employs 30 people and has an annual turnover of around £2m, operates from a 1,100sqm facility, but he intends to add an extension taking the factory footprint to around 1,400sqm next year.
Bailey anticipates that many of the orders for the Smart collator will come from all around the world. The export market currently accounts for around 80% of Col-Tec’s turnover and the company has sold machines to places as diverse as Iran and Sudan. Despite this reliance on exports Bailey is quick to point out that the UK remains the company’s single biggest market and he’s incredibly proud of Col-Tec’s British heritage.
“I do feel that every time we put a machine overseas we are planting a British flag somewhere,” says Bailey. “I’m very proud that this is a wholly made British product and I love saying that we are promoting brand GB and exporting it around the four corners of the globe.”
A prototype of Col-Tec’s Smart collator was unveiled at Ipex 2015 and although it took a couple of years to get the machine to market, for the past two to three years Col-Tec has been “selling the Smart collator in anger” to customers in the UK, the US and Australia. Bailey thinks that the machine is going to be a big part of the company’s operations over the next five years or so. At the other end of the spectrum, Bailey singles out the customised Braille collator the company originally developed for the RNIB in the UK. The company has already sold a handful of models of the Braille collator into Brazil and the US and Bailey says each time Col-Tec undertakes a customised build for an individual customer he’s always on the lookout for other global markets he can sell versions of the machine into.