A Black Country manufacturer plans to double its turnover and create jobs after winning funding to diversify into new products.
The owners of Cradley Heath-based Reddifast Steels believe they have identified a niche in the market to make steel safety barriers for car parks.
Rod and Lynne Laight, who established the company in 1999, believe they will double the firm’s £1.3 million annual sales with the innovation.
The firm, which supplies precision spring steel wire and strip to the spring and fastener industries in the UK, has secured £10,000 of funding from the Black Country Reinvestment Society for its plans.
It currently has more than 900 customers in the UK, from micro businesses to large companies.
Mr Laight has set a target of doubling turnover this year, and believes it will have a knock-on effect to the firm’s 10-strong workforce.
He said: “We had planned an expansion with a new product, spring steel safety barriers for car parks. To meet British standards, safety barriers have to be tested by having a car driven at them and we had to purchase material to manufacture the barriers at a cost of £10,000.
“We produced a business plan and made a full presentation to our bank, which was fully supportive at the time. It took a year to implement the plan and to gear up, and when we went back to the bank for the finance – just £12,000 – the climate had changed and they said no. I was bitterly disappointed as it was a costly exercise for us. We also had to bear the costs of consultants and a legal team.
“We then approached BCRS because there was no other source of finance available to us. We needed just £10,000 over 18 months to enable us to purchase stock and employ two skilled people. The team at BCRS got on board very quickly and worked swiftly with us, with the result that the new side of the business has sailed ahead and created additional employment.”
The company has been selected to manufacture the barriers for the Gloucester Quays retail centre.
The product is made from steel produced in this area and as a result of such contracts, the company has taken on an extra two members of staff.
The company moved to its present location in Cradley Heath eight years ago to be at the heart of the Black Country manufacturing industries and now employs ten people.
Mr Laight, who was a managing director of a steel company at age 28 and has 30 years experience in the industry, said manufacturers have been poorly treated by the finance industry.
“I believe the manufacturing sector has been used as a scapegoat by banks and credit insurers”, he said.
“Credit insurers have done a big disservice to manufacturers and have ruined any chance of any company borrowing money from any financial source.
“They refuse to look beyond the balance sheet – which can give a false picture - and they fail to understand that manufacturing is part of a large supply chain. For example, we supply companies that have no credit whatsoever; in effect we become their bank and supply them with an overdraft facility. We have built up great loyalty with our supply chain over the years, and are supporting many other businesses along the way as part of the process.
“But in order to do that, we need to have the money in place first so that we can help them.”