Backing a winner

When Alec Cassie and Paul Biggs of BCW Engineering walk through the doors at MACH 2012 it’s likely that their thoughts will return to the same exhibition exactly 10 years ago, when they arrived at the 2002 event with little more than a basic business plan and the dream of creating a new engineering business. Solutions reports.

A dream it may have been then, but BCW Engineering today has a turnover in excess of £10 million. The business has invested over £4 million in the latest CNC technology, employs over 100 staff and has won awards for technology and innovation.

This success story actually began with a chance meeting at MACH 2002. Mr Cassie and Mr Biggs knew they wanted to move into manufacturing but thought it would be impossible to find someone willing to back their plans. That was until they bumped into an old acquaintance, Steve Gee, then general manager at Close Asset Finance, who was exhibiting for the first time. Mr Gee had known the pair from their days at the Hyde Group and after a short discussion about the proposed new business, agreed to back BCW by lending £95,000 to buy its first CNC machine – a Hitachi Seiki H400.

"Initially, we had no premises and nowhere to actually put the machine,” recalls Mr Cassie, “but we soon established ourselves in Unit 23 on the Smallshaw Industrial Estate in Burnley, Lancashire. Our intention was to make the business profitable as soon as possible and within three months we’d accumulated the deposit for the machine – which is still producing parts today.”

Money matters

Over the past 10 years, Close Asset Finance has continually helped the business grow, providing funding for around 20 CNC machines. In total it has supported around £2 million of investment by BCW. "Whilst Alec and Paul are prudent directors, they can also spot an opportunity when they see one." Mr Gee reveals. Mr Cassie agrees: "One of the first things we did was employ an accountant – we needed to understand our cash position. This was a result of my Hyde Group training and I remember saying we would die if we didn’t achieve £4,000 per week. I took the view we might be making parts and have a healthy bottom line, but you’ve got to be in control of your cash to keep a company healthy.”

Initially, the business focused on the automotive sector but it soon became apparent that if the company was to achieve the original vision, it required both a technologically advanced UK operation supported by an offshore low-cost business. This realisation was crucial to BCW's next stage of development and within five years the business had a subsidiary manufacturing plant established in India and a new high technology location to support the operation at Smallshaw.

This global sourcing strategy has seen some parts – mainly for power generation – produced by BCW's partner in India. "It isn’t a case of selling my soul, it's about asking how can I enhance my business?" says Mr Cassie. "The answer is by getting a £3 million contract and having £1million of it made in India to secure £2 million to be made in the UK."

For over 10 years the policy at BCW has been to invest heavily in people and this has been recognised by numerous awards and also royal recognition when Prince Charles opened its second site in 2008. The policy was to employ time served professionals with the patience and ability to teach at all levels. These individuals were then mixed with people from all walks of life – from graduates and school leavers to people of any age that just expressed a will to work and be trained. This approach has certainly bared fruit, as a number of these individuals are now in senior management and engineering positions.

Recession buster

In common with many UK manufacturing SMEs, when the downturn hit in 2008 and 2009, BCW had to cut its cloth accordingly. The business unfortunately had to lay off some staff, although they were all re-employed before the middle of 2010.

It was during this time BCW again relied on assistance from Close Asset. At a time when the UK banks had no appetite to invest in the manufacturing sector, Close Asset provided further facilities to ensure necessary investment took place, enabling BCW to accelerate out of recession. Mr Cassie recalls: "In seven years to 2009 we had never missed a finance payment or defaulted in any way. Close Asset was there when we needed it on day one and it was there again for us to ensure we didn’t miss out on the opportunities which lay before us in 2010 and 2011."

Looking forward, the company’s growth potential is now in power generation and aerospace, whilst the automotive work continues. "One of the reasons we have survived," Mr Cassie observes, "is that we are balanced across aerospace, automotive and power. We've also just got our first medical order and are looking closely at nuclear.

“The next 10 years will take BCW into another carefully planned growth pattern,” he concludes. “This includes an even stronger relationship with our Indian partner LG Balakrishnan and, no doubt, a continued relationship with Close Asset Finance. The business will be sticking to its diversification policy whilst maintaining its ethos of training and succession planning.

Close Asset Finance www.closeassetfinance.co.uk
Hall 5 Stand 5228