Keep it in the family
Sunday, December 1, 2019
In 2004 the sales manager of the then named Bristol-based Baronial Labels, Paul Stokes, undertook a management buyout of the business along with his co-workers.
After rebranding and restructuring the operation, Bristol Labels was born and as managing director Stokes successfully led the company for more than a decade.
Then, in 2015 Stokes and the team were joined by his son Ben, who came on board as sales and marketing manager and to launch the digital side of the business. The move was, Ben Stokes says, most likely the beginning of a potential exit strategy in the back of his father’s mind.
And indeed, three years later, at the end of 2018 after having promoted his son to director earlier in the year, Stokes was again part of an MBO along with what was still the original team that had bought out the firm 14 years earlier. But this time Paul Stokes was selling his share of the business in order to retire.
Ben Stokes says: “When we bought our first digital press, an Epson SurePress, I was employed as the sales manager to fill that.
“I totally fell in love the label industry and knew this was me and I think as soon as dad realised that, he was ready to leave. He bought a place in Spain and started to spend more time out there once he knew I was competent.”
While Stokes was on the steepest learning curve of his working life, his father began enjoying time away from the business with the plan to come home once a month to ensure things were running smoothly.
“The idea was nice, but it didn’t work,” Stokes says. “It ended up with him just always being on his laptop or phone and basically working from Spain, so we knew something had to change.
“Ever since I joined I knew there was a lot to do to get the company to a place where we could really compete with the market and while I was pushing forward, Dad was in a different place.”
And so the moment came towards the back end of 2018 when Paul Stokes decided he wanted to leave, but he wanted to ensure the stability of the business as well as the happiness of the team. The challenge being, would his son want to take over? Would the staff, who’d bought out the company with him 14 years ago, want to or even be able to buy him out? And indeed, would they back his son to succeed him?
“We’re really close here, like a big family, basically. And when Dad told us that he was ready to retire, we knew we had to come up with the right plan so we all sat down and put everything on the table,” explains Stokes.
“Dad, of course, had shares and he wanted to sell them so we needed to raise the capital between us to let him do that. We came up with an offer, which he accepted, and then went through a six-month period of getting the funds together and signing it all off.
“Obviously we spoke to solicitors and accountants to make sure everything we were doing was right, but because we are so tight as a team, we didn’t want to let anyone else interfere with the process.
“It was quite simple really. Everyone increased their shareholdings but we couldn’t raise the full amount so Bristol Labels purchased the rest,” explains Stokes.
Alongside the financial discussions the potentially more sensitive matter of who was going to run the business needed to be dealt with.
“When we looked at what the structure should be, I put my hat in the ring for the managing director role but I was really aware that I was only 28 and still pretty new to the team, only being four-five years in while everyone else had been here since the company started,” Stokes says.
In fact his worries were unfounded. With a company decision taken not to recruit externally and there being no contest from within for the leadership role, Stokes was voted in by all shareholders and stepped up to the mantle in December 2018. Meanwhile Marie Peacey was named financial director after the team decided to maintain the structure of having two directors in the business.
“It was a massive boost for me,” Stokes says. “I tried not to think about my age and relative newness in the industry, I just knew I could do the job. I knew what was needed and knew I could make it a success but part of me was worried that others wouldn’t feel that because of course I’m surrounded by people who have a lot more knowledge than me.”
Stokes says that outside of the discussions and contractual machinations, which took around six months, it was business as usual on site and efforts were made to ensure that quality and consistency of work didn’t slip and vitally, that customers felt confident.
“From a customer point of view we have made sure that nothing has changed for them, that they always have a person to contact and they know who that is. We are very close with our customers and because this happened over a period of time with dad being away quite a bit, they were used to dealing with me anyway so it was a smooth transition,” Stokes explains.
Stokes says that with the reins fully in his hands he decided to seize the long-awaited opportunity to rebrand and modernise the company, launching a new-look website shortly afterwards in January this year, which was designed by local firm Arobase Creative.
“It’s been really great, we have a lot more engagement through social media and we’re really proud to promote the business with our new branding behind us. If I’m approaching well-established businesses, with strong branding, our own branding needs to match up to that because they need to have confidence in us,” he says.
Next Stokes overhauled the firm’s internal admin processes, implementing a bespoke IT system using the FileMaker platform and leaving Bristol Labels’ paper-based admin days behind.
Other details such as branded sample packs have also been created, which he says are small changes that have made a big impact.
Stokes says that while the team continues to knuckle down and grow the business in its new shape, the next focus is on increasing digital work, expanding the new computer system and putting in a newly ordered GM finishing line in February next year, which he hopes will boost the firm’s embellishment, laminating and hot varnishing capabilities. A new member of staff may also be brought on board in early 2020.
Space at the firm’s 450sqm site, he explains, is pretty limited after the company invested in an Indigo 6900 in January this year and the arrival of the GM device will mean floorspace is full, so the long-term goal is to leave the currently leased facility and buy a larger site.
“That’s definitely a long-term plan though,” he asserts. “We have a couple of quarters behind us now since we’ve made changes and everyone here is very excited. The results are great,” he says.
“We’ve gone through some dramatic changes for a small company and we are really pushing forward. We know where we want to be and we have a long way to go but we are heading in the right direction.”
Inspection host Ben Stokes, managing director
Size Turnover: £1.2m; Staff: Nine
Established February 2004
Products Self-adhesive labels
Kit HP Indigo 6900, GM DC330MINI, eight-colour Nilpeter, two Bar Graphic die-cut, slit and rewinders, recently purchased GM Miniflex converting device arriving February 2020
Inspection focus Undertaking a successful MBO
“Have confidence. You can’t doubt yourself, you have to go for it. Of course you have to be sensible and not run before you can walk but you also have to take a certain amount of risk,” says Stokes
“Make sure you surround yourself with people that have the knowledge you need and don’t be scared to ask people, even if it’s a competitor. Industry colleagues do help each other and you need to utilise that. When I started I was picking up the phone 10 times a day”
“Keep in contact with your customers, don’t forget them. Sometimes people see customers as just another order. It’s all about contact, don’t just email, pick up the phone, go and see them. It makes all the difference”