Case Study: Funding secured for new Manufacturing Floor and Wall Line

Donaldson Timber Systems is the leading UK offsite timber systems manufacturer, specialising in the supply and construction of sustainable state-of-the-art open and close panel timber frames. The business operates across the United Kingdom with factories in Scotland and Oxford. Donaldson Timber Systems supply their product across the supply chain into private housing, affordable housing and commercial buildings.

A desire for growth

Rod Allan, Managing Director of Donaldson Timber Systems got in touch with Molly Hill, Regional Sales Manager with Close Brothers Asset Finance to discuss funding options to help with their ambitious growth plans.

For the business to continue with their growth plans, they needed to upgrade and develop their manufacturing capability at their factory in Witney, Oxford. The growth project was devised over a 5-year period, which included a new floor manufacturing production line and wall line. These were to be delivered in succession from a specialist manufacturer in Sweden.

The new machinery investment has allowed for a new automated process within the factory, increased capacity volumes and gives the factory the ability to produce more precise and precision engineering during the manufacturing process. It will also allow the factory to become a 24-hour operation so that in peak periods, the business is able to meet the demands of their clients.

The perfect agreement

Molly put together a comprehensive finance package for Donaldson Timber Systems to acquire the new machinery which totalled circa £10 million. This involved a short-term loan facility which was used to pay the supplier prior to releasing the equipment from the factory in Sweden ahead of its arrival in the UK. Upon delivery, the manufacturing lines were funded using a Hire Purchase agreement.

The Hire Purchase agreement has allowed Donaldson Timber Systems to secure the new assets whilst being able to pay for them over a set period with manageable monthly payments which fall in line with their cash flow. This will support the company’s growth plans and boost their turnover.

Molly commented: “It was great to work on such a large project with Rod and the wider team at Donaldson Timber Systems. Since our initial meeting, this deal has been 3 years in the making which makes it gratifying to finally be able to see the kit in the factory. I look forward to seeing Donaldson grow further in the future with continued support from us.”

“Molly was a great help and understood our needs, she was there every step of the way to ensure we got the agreement we needed to secure our growth plans. We look forward to working with Molly and Close Brothers Asset Finance again in the future.”

Rod Allan, Managing Director at Donaldson Timber Systems