The big move: investing for ongoing growth
Monday, November 27, 2017
Curtis may not be looking to build an empire, but it recognised when the time was right to step up to the next level.
Curtis Print & Packaging was a victim, says a delighted managing director James Williams. “A victim of its own success,” he explains. “We were at capacity. We wanted to take on more work, and the opportunity was there. But the space wasn’t.”
The desire to take this long-established family business to the “next stage” set in train an investment programme that would run to around £1.3m and, at the time, do anything but delight Williams. In equal measure the process would excite and “scare the living daylights” out of him, to say nothing of his 60 or so staff squeezed into a cramped premises in south London.
And the nature of the Curtis business made the upheaval of an investment programme – involving a relocation, new kit and more staff – certain to up the scare levels. Curtis specialises in high-quality short-run packaging with customers “pushing the limits of what’s achievable”, Williams says. With such an onus on perfection, anything that could tip such a fine balance was tempting fate.
Nevertheless, the company chose to tempt it. The business was formed by Frederick George Curtis in the late 1930s, starting with paper bags, moving on to record sleeves and now, a few generations later, to lavish but hard-to-execute packaging for cosmetics, confectionery and spirits. Frederick’s son John is chairman, grandson Ben commercial director, and great granddaughter Sarah is a project manager.
Up until about 12 months ago the company’s base had, for 35 years, been a 1,200m² site in Wimbledon, with one B1 Heidelberg Speedmaster CX 102 carton press and other kit such as gluers and cutters jammed into the building. It was, recalls Williams, a disjointed setup “with no flow to the business”, staff weaving pallets between different areas for print, cutting and everything else.
“The investment programme was driven by the need to move, so the first thing was to identify a site within reasonable distance of Wimbledon. This was crucial, as our staff are the most important part of the business. What we do is highly specialised, and our staff are likewise. We wanted to keep as many of them with us, so a nearby location was a good way of limiting travel disruption.”
Finding the right type of space in the right location took time – far longer than Williams and his team initially expected. Only when they found an appropriate site could other parts of the investment programme fall into place, as the shape, size and layout of the space would give a pointer on what new kit they could accommodate and how many more staff they could take on.
Williams now recognises he was “rather niaive” in thinking he would find a “nice factory”. Even when he found the right one, after months of searching, it was little more than a shell, requiring floor reinforcement, new air conditioning, lighting, electricity and a total office deckout. The space, however, was good – 2,000m², and just 13 miles away in Redhill, Surrey.
“We didn’t really appreciate the time and effort involved in getting the premises into operational mode, which later involved building a mezzanine for more space. But having chosen the site, other needs became quickly apparent, which would shape the investment programme. We had only one press, cutter and gluer, so what would happen when we closed for a lengthy move?”
Curtis bought another press to run alongside the Speedmaster, already running 24 hours a day, five days a week, for when the move took place. This time it opted for a secondhand B2 Speedmaster XL 75 chosen for its efficiency with small sheets.
“A lot of work was going through the B1 press in smaller sheets, making it harder to quality control a sheet. It made more sense to buy a B2 machine, much more suitable for the small sheets and shorter runs clients were now demanding. It also solved the problem of relocation downtime. The new kit went into Redhill while we dismantled and moved the B1 to our new base.”
Other kit choices – and therefore the investment spend – were defined by outsourcing costs: Curtis used to spend £500,000 a year outsourcing foil blocking, £100,000 gluing and £75,000 die-cutting. So in went a Johannesburg foil blocker, a Brausse die-cutter and a Bobst Media II gluer. Total investment was £350,000 on top of the £550,000 for the five-colour Speedmaster.
The cost of the move itself came to around £450,000, but it could have been more: Williams toyed with using a turnkey consultancy to project manage the relocation. He gasped at the £750,000 cost and instead formed an in-house project management team.
“This terrified the living daylights out of us but saved the company about £300,000. Ben Curtis captained the move and took ownership of managing all the suppliers we needed for things like the office fit out and reinforcing the floors. Non-executive director John Pomfret, who helped MY Cartons of Slough with a similar move, also stepped in and proved invaluable.”
Careful planning was a must to minimise downtime for the big move: by the end of September 2016, the new Speedmaster was installed at Redhill and operating a month later. The first items of equipment were moved from Wimbledon on Thursday 3 November and by Monday 7 Curtis was operating in its new home. Williams minimised downtime because of the critical need for quality. Outsourcing was an option, but the last one. Williams did not want to lose grip on quality control.
If this was a major concern, so were staff and customers. Retaining people depended not just on proximity of the new base, but also constant and open communication and flexibility on issues such as hours and shifts. In the end all 60 staff stayed with the business, except one employee, who chose to take early retirement instead.
“People are scared of change and we had to be sympathetic to this, especially when the rumour mill kicked in and a silly story about an imminent move to Ipswich did the rounds. We kept dialogue and communication open and constant and did nothing by stealth or on-the-quiet. Clients were also kept in the loop at all times and they soon realised they would benefit as much as we were going to.”
Williams was expecting a hit on margins and a drop in sales. As it happened the move, deliberately timed for the quietest three months – November to January – saw record levels of business, pushing productivity, and stress levels, to the limit. It also boosted annual sales by £1m.
Last year Curtis Print & Packaging made £8.6m turnover. This year the forecast is £9.6m, staff headcount has gone up to 68, and customer feedback has been “amazing”. From the mezzanine Williams can now see the work literally flowing through the various machines on the factory floor and uses the space like a site office.
“If I could do anything differently it would be to take on a bigger space – we could do with another 5,000 or 10,000 square feet,” he adds.
“But the question is how big do you go? We don’t want to chase turnover and growth for the sake of it, and we’re not looking to build an empire. But we do want to look after our customers and keep quality high, and for that reason you must be prepared to invest.”
Location Redhill, Surrey
Inspection host Managing director James Williams
Size Turnover: 2017 forecast £9.6m; staff: 68
Products High-end packaging for cosmetics, confectionery and spirits. Clients include The Body Shop, Neal’s Yard Remedies and Charlotte Tilbury
Kit Six-colour Heidelberg Speedmaster CX 102, five-colour Speedmaster XL 75, Zünd S3 M1200 digital cutting table, a Fujifilm Acuity flatbed, Heidelberg and Johannesburg foil blocking, Brausse die-cutter, Bobst gluer, Heiber & Schroeder window patcher
Inspection focus Planning and implementing an investment programme
Start early Get a head start and prepare long before you implement your investment plan; the search for premises, for example, can take far longer than expected
Identify leaders Pinpoint people who can take a lead in the programme, such as directors and non-executive chiefs who may be better – and more cost-effective - than consultants
Keep your staff Most likely your people are your business, so any change caused by the investment programme must take them into account and offer flexibility in employment terms
Inform clients Tell customers what you are doing and how it will improve your company’s offering – and therefore be of a benefit to them