Bentall Rowlands is an export success story
Taken from Farmers Guide May 2006 Issue 321
Manufacturing in the UK may be declining hand-in-hand with exports, but Scunthorpe-based Bentall Rowlands Storage Systems Ltd is bucking the trend with sales - mostly to overseas customers - booming.
And what makes the company's performance even more remarkable is that just four years ago its predecessor, Bentall Rowlands, went into receivership after diversifying too far from its core business.
"The old company had branched out into making parts for trains, buses and aircraft," Sales and Marketing Director Rex Hilton told Farmers Guide. "The turnover was good, but margins were very low and in 2002 the business went into receivership.
"A company from Birmingham bought the assets, but just six months later the same thing happened again."
This time, Rex and fellow director Kevin Groom took action and, with the help of a third party who helped with finance, bought the business themselves.
Bentall Rowlands Directors Kevin Groom (Left) and Rex Hilton
"We felt it was clear what had gone wrong and refocused the company on crop storage," Rex said. "We slashed very hard and went from a business employing 180 staff on the shop floor and a further 50 in the offices to the position we have today where there are seven in the office, including Kevin and I, and 14 working in the factory."
"We were left with very good people," Kevin added. "That's not to say that the people that left were not good staff, but their skills didn't meet our requirements at the time."
The strategy that Rex, who had been with the company since 2000, and Kevin, a Bentall Rowlands employee since 1977 and now Technical Director, adopted quickly proved to be the right one.
"Within six months, the company was moving towards profitability, although we had major problems at first," Rex said. "Because of what had happened in the previous year, we found it very difficult to get credit from the major suppliers.
"Thankfully two companies, BAP of Scunthorpe, which supplies fixings, and Humber Galvanising of Hull, which operates a galvanising service, were willing to work with us and helped to rebuild the business."
Sales hit £3 million in 2003, £3.5 million in 2004, £4 million in 2005 and are predicted to reach £5 million this year.
"From a position where almost no-one would supply us, we're now a strong, growing company with a credit rating of Very Good," Rex said. "That's not bad after just three years."
In a period when UK farm investment has been hit by falling commodity prices and continued uncertainty, Bentall Rowlands Storage Systems has built sales by developing overseas markets.
"A lot of the export sales have been generated because of past work we have done in these countries," Rex said. "If you have done a job well, they will come back to you with repeat business. Some clients come back year after year."
That's not to say that there isn't a lot of effort involved and Rex spends a lot of time flying around the world keeping in touch with the company's agents and customers, especially in key territories like Sudan, Nigeria and Africa.
It also helps that Rex and Kevin's company is on the approved suppliers list of major multinationals like Swiss-based millers Buhler and US-based Cargill. And it enjoys a similar status with many African governments. Three of the company's recent projects were in Tanzania, Sudan and Mozambique.
Some of the work the company carries out is won on tender against international competition. Rex will take the initial enquiry and Kevin will price the job. Only if the contract is won will Kevin then visit the site to carry out a technical survey.
A major contract for three strategic storage sites in Malawi has just been won on this basis. The sites, each with 22,000 tonnes of storage, will be built by Bentall Rowlands on a turnkey basis, with construction work likely to start in August this year. The sites will be used to store home-grown maize for use in times of drought.
A new 3D computer-aided design system is now used to help design the storage systems and once the plans are finalised, the items required are fabricated in Scunthorpe and then shipped to the site in kit form in containers, followed by a Scunthorpe-based supervisor to help troubleshoot the build.
"Where we often win is our ability to do bespoke work," Kevin said. "We can build a grain bin that will fit any space the customer has available. That's a very important factor when processing plants are limited in where they can put extra storage."
All parts that make up the grain bins and ancilliary equipment are made at Bentall Rowlands Storage Systems’ Scunthorpe factory.
In fact, Bentall Rowlands Storage Systems can build storage bins with capacities from 15 tonnes to 12,000 tonnes, the latter bin having a diameter of 27m and towering 20m high.
"We use only the very best quality Z35 steel, and as well as the storage bins, we also build and supply all the ladders, platforms and catwalks that are needed," Kevin added. "If required, we can also supply handling equipment like conveyors, weighers and elevators from selected key suppliers. This is vital as more and more people now want just a single point of contact for a contract."
The company's growth in Africa has been fuelled by aid agencies that are sending grain into the region to be processed and turned into bread to feed the starving populations, although it has also built rice stores in Thailand and sees further opportunities for growth in Asia and India.
The parts of a six silo, 30,000 tonnes storage facility in Nigeria wait to be loaded into containers for shipping.
But according to Rex, there are also new opportunities closer to home as a result of the interest in biofuels.
"We're already quoting for storage facilities for bio-ethanol plants here in the UK and there are bound to be similar plants going up in Europe," he said.
Bentall Rowlands rarely gets directly involved in UK sales, preferring to work through its Andover-based preferred sales agent, BDC Systems, instead.
"BDC has been in the business for 12 years and is well respected in the industry," Rex said. "It has six salesmen across the UK and they follow up leads from agricultural dealerships up and down the country.
"We'll take on projects from £200 upwards and we get quite a lot of business making replacement parts for the Bentall Rowlands equipment that is already in the market place.
"As the industry realises we're still here, we have seen sales increase in the UK, although the majority of grain storage being built appears to be for co-ops and groups of farmers rather than individuals."
The profile of Bentall Rowlands Storage Systems should increase even more this year - which marks the bicentenary of the Bentall Rowlands name in the agricultural sector - as the company is launching a new product at Cereals 2006.
"It's the first new product we have launched for some time and it will be on the BDC stand at Cereals," Kevin said. "I have improved the company's tunnel drying system. It is now 10ft high, as opposed to the 6ft version we have traditionally made, and other changes have been made to help it operate more efficiently."
The launch will be accompanied by a new website - www.bentallrowlands.com - which itself is another sign of a company that is preparing for growth.
"We know we are going to have to grow," Rex said. "As it is the factory staff are all working overtime most weeks and we are looking for at least three new employees, although we'll probably have to add about 5-10 in total this year."