“The team at the Growth Hub has always been really helpful and has made it easy to talk honestly about our business needs.”
About
Established for over 35 years, Wye Cylinder Engineering specialises in the manufacture of hydraulic cylinders. Its heritage sits within agricultural, but over the years it has diversified into other sectors. The economic crash of 2008 led the business to restructure, and it has since grown steadily from a turnover in the region of £3.5m, to a projected turnover of £7.5m this year – the last 12 months have been particularly strong with turnover increasing by almost £1m in this timeframe alone. Employee figures over the same period have almost doubled and now stand at 56. Again, growth was particularly strong in the year 2020-21, with staff numbers rising from 48 to 56.
Due to the phenomenal growth of the past year, the focus for the coming 12 months is to sustain turnover before looking to further steady growth in 2024/25 onwards.
Growth is now driven by profit rather than by simply being busy and with a desire to develop this further with a more strategic approach to how they sell their services to attract more quality customers, Richard Williams, MD at Wye Cylinders, contacted an independent consultant to support the business on its growth journey.
With a focus on business development, a conversation around grant funding began and the team at Wye Cylinders met with the Marches Growth Hub Herefordshire. It has since gone on to access various funding programmes that has allowed it to invest in more efficient and up-to-date machinery and in doing so, strengthen its current and potential customer base. It now has further expansion and relocation in its longer-term sights.
How the Marches Growth Hub helped
Initially sceptical that there was support and funding appropriate to his business, Richard has gone on to welcome the guidance provided by Marches Growth Hub Herefordshire manager Lyndsay Francis and her team. He comments: “The team at the Growth Hub has always been really helpful and has made it easy to talk honestly about our business needs. You get a sense that once they understand those needs, they’re genuinely supporting you to submit a successful application.”
Wye Cylinder’s first application supported by the Growth Hub was in 2019 for a Business Energy Efficiency Programme Grant (BEEP), managed by Worcestershire County Council. This enabled it to invest in a new piece of machinery that would drive greater energy efficiency and productivity.
It has since applied for a £20,000 grant from the Business Growth Programme (BGP2) to support the purchase of a new £45,000 paint drying oven. This has enabled the business to reach more customers who would otherwise turn to Wye Cylinder’s competitors.
It is additionally planning to apply for a Small Equipment Grant in 2022 which, if successful, would be used to finance the purchase of welding equipment to further improve and speed up overall timeframes.
Impact
For Richard, simply knowing that his business was eligible for grant funding made a significant difference. The funding that has supported his investment in new equipment has allowed him to close a weakness in the business’s overall processes and in doing so, extend his customer base to include a far greater percentage of higher end, more profitable, orders. It has also enabled the team to offer a more complete, end-to-end service that attracts more sophisticated customers.
Significantly, the purchase of the paint drying oven has led to increased capacity which means an extra 500 cylinders can be completed each week. This in turn has pushed turnover to increase by £100,000 per annum (an 8% increase) and created two full-time jobs.
The computer numerical control (CNC) machine that they were able to purchase with the help of the £20,000 BEEP grant, meanwhile, has not only enabled the team to realise yearly energy cost savings in excess of £9,000, but also allowed them to save almost 25 tonnes of carbon each year. The new equipment also runs far more efficiently than the one it replaced which aids overall productivity and enhanced customer experience.
Future Growth
Looking to the future, Richard and the team have already mapped out their projected equipment needs over the next five years and beyond, but they have bigger plans for growth too.
Currently located across multiple factory sites, some of which are owned whilst others are rented, Richard would like to consolidate the entire operation in to a single, purpose-built, facility and it is with that in mind that he can foresee the need to tap into additional support from the Marches Growth Hub.
“Financially I think we’re in a strong position to consider such a move, but strategically we might struggle. The planning that goes into a big development of that kind, the manpower it would require, and the myriad of considerations to make it a success – not to mention the actual build process itself – is something we’d need support with. I’d certainly look to the Marches Growth Hub for guidance at that time.”
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