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Business Insight Thursday November 7 2013

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Going for Growth Innovative Nottingham invests in itself Pages 9, 10, 11

Thursday November 7 2013 | the times

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Business Insight

Welcome

Thinking globally THERE is little doubt that the North has the goods, and the will, to get out there and sell to the world.

There is even less doubt that, to grow globally, its existing and would-be exporters welcome any hints and guidance they can get.

That’s why the UK-wide workshop known as Export Week, beginning on Monday under the aegis of UK Trade & Investment, will be well attended and appreciated, featuring as it does events from ExploreExport (Gateshead) to the Cumbrian Essentials roadshow.

But in this issue we also feature more permanent helping hands – such as Leeds-based global law experts DLA Piper, UK Export Finance, and UKTI’s globetrotter extraordinary on behalf of Northern companies.

Could there be more co-ordination to pull all such valuable strings more tightly together into a one-stop shop? That is one challenging question discussed by our export-themed Forum opposite.

Our second Forum is equally challenging. It talks about regeneration – of the famous city of Nottingham – with the help of an innovative and creative Growth Plan and some of the big ideas put forward by the distinguished members of our panel.

We won’t mention the historic bow-wielding hero of these parts, except to say it is extremely unlikely that this re-energised city will miss its target.

Inside

Globetrotter extraordinary The North West’s export stimulator Page 4 International law jungle Firm that offers expert guidance Page 6 Nottingham’s Growth Plan Forum: talking about regeneration Pages 10-11 The Times Business Insight reaches more senior business people in the North of England than any other quality newspaper.

Indeed, with 184,000 readers* and reaching almost 20 per cent of the all c-suite executives**, there is no better place to be seen. *Source NRS July 2011 - June 2012 **Source BBS 2011

To advertise in the next North of England edition of Business Insight: Freephone 0800 027 0403 or contact: stuart@timesnorth.co.uk

Forum International trade

Wanted: a one-stop shop for exporters

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As a precursor to Export Week, which runs from November 11-15, the latest Forum from The Times gathered in Leeds to discuss how best to encourage growth in the export market. Barry McDonald reports

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or such a small nation, the UK undoubtedly punches above its weight in the export market.

But what can be done to boost international trade and what are the barriers facing new entrants into the world of exporting? Our panel met at the offices of DLA Piper in Leeds to discuss strategies to export.

What role do LEPs and their partners have in boosting international trade?

Clive Memmott of Greater Manchester Chamber of Commerce believes that Local Enterprise Partnerships (LEPs) should have an enabling role. “Their job is a very complex partnership,” he said, “with stakeholders like UKTI, Chambers [of Commerce], the private sector and big multinationals. It’s a very committed role.”

One such role, according to Clive Drinkwater, is mentorship – and he and Mr Memmott were instrumental in establishing export champions in the North West. “We want to offer mentoring,” Mr Drinkwater said, “and we have a select group of people in particular sectors such as the service sector, manufacturing, chemical, automotive, aerospace, environmental technologies and renewable energies. Each of the individual LEPs in the North West is very keen to put forward a programme that reflects local needs.”

Mike Strawson of Chamber International is another advocate for what he calls export ambassadors. “Some of our ambassadors are from companies who have only been in existence for five years,” he said. “One of the conclusions we’re coming to is to break it down into certain sectors and market regions.”

Mr Drinkwater added: “The reason these guys are export champions is because they’re out there batting for Brit-

ain. It’s not surprising sometimes when we ask if we can get two or three of our export champions together … they’re all abroad. Which is what they should be doing.”

Recruiting ambassadors is just one of the main areas of focus for Leeds City Region, according to Eric Hawthorn.

“There are three main roles for Leeds City Region,” he said. “International trade and export, inward investment and innovation. Everything we’re trying to do is about breaking down barriers to growth.

“We’re trying to encourage companies to export, whether it’s services or products. We have a number of initiatives: one is our Export Network, which is a partnership between UKTI, Leeds City Region and Chamber International. The focus is on recruiting export ambassadors and already we have 30.”

Josh Wong, a partner at DLA Piper, noted that for a number of clients keen to expand their trade internationally, there is still a sense of confusion as to where to get the right advice. “Some of the new initiatives like export champions are a great idea,” he said, “but what other plans are there to push the message out there to the SMEs [small and mediumsized enterprises] about what a LEP can offer, and the interaction between LEPs and UKTI and Chambers? That to me is still a little bit unclear. ‘Where is the starting point for an SME?’ is a question I’m often asked.”

Is there adequate export support for SMEs? Where are there gaps?

As a first point of contact for wouldbe exporters, Clive Drinkwater hoped UKTI would be near the top of their list. “I also think the Chambers of Commerce play a pivotal role in reaching out to the business community and pushing

forward the benefits of export,” he said.

“When you think about trade, you think about exporting and you think about going to the Chambers of Commerce.”

Mike Strawson voiced concern over the lack of a one-stop shop for potential exporters. “There is a proliferation of organisations,” he said, “and the message from would-be exporters is total confusion – ‘Who do we talk to?’ There are so many different people. Is there not space to provide a central focal point?”

Clive Memmott disagreed. “I like the proliferation of help that’s out there,” he said, “it’s just a failure of marketing.

A great example of this is UK Export Finance. The overhaul of their offer three or four years ago produced one of the best export finance products there is available. It’s astonishingly powerful, and the array of services there is hopelessly under-marketed.

“We can walk into most of the major clearing banks within 200 yards of here and I guarantee there will be very little knowledge in these places of that scheme. That gets to the heart of what these problems are.”

Steve Cowles of UK Export Finance added some thoughts. “The challenge is that there has been a relatively small amount of investment in export activities in this country compared to our international competitors,” he said. “You can’t change that overnight. We are going in the right direction but there is still work to be done with the banks and how to get the message down to high street level.”

Eric Hawthorn – who, in addition to his role with Leeds City Region, is managing director of Radio Design – offered a unique insight into his route map to exporting: “One of the biggest barriers to entry into new markets is to find a very capable and experienced person to represent my business there. There’s a long

the times | Thursday November 7 2013

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“In China,” he said, “it’s becoming a well-known fact that the first-tier cities are becoming expensive and the opportunities there have already been taken up by other players.

“People are looking to second- or third-tier cities which are still incredibly large but have less foreign investment and more of a rising middle class. That’s also the case in some mature markets, like the US, where there are smaller cities – as well as across continental Europe.”

Clive Drinkwater responded, noting that “You get a critical mass of consumers and creativity in cities. When I did my exporting, I didn’t necessarily think that going to places like Indonesia was about setting up in Jakarta. I built my factory in central Java.

“That has been done for some time and I think it’s important to think about markets and not just countries. America isn’t one market. If you think the tastes and fashions and business methods in California are the same as those in Virginia, you’re wrong.”

Around the table From left to right...

Mike Strawson, senior associate, Chamber International

Clive Drinkwater, regional director North West, UKTI

(UK Trade & Investment)

Eric Hawthorn, Leeds City Region

Alasdair Nimmo of The Times, who chaired the Forum

period of relationship-building and a long period of product development and customisation, trials – and then hopefully we sell some product.

“What we can do is focus on developing new markets. Each time I’m developing a new market it’s costing me £150,000 a year for the man on the ground. Two years of that and hopefully, if we’ve picked the right markets, we’ll be successful. That’s £300,000 of investment in each new market. “If I’m doing that

Josh Wong, partner, DLA Piper

Clive Memmott, chief executive, Greater Manchester Chamber of Commerce

Steve Cowles, export finance adviser, UK Export Finance

in five markets, that’s £1.5m straight off your bottom line. If there was a product that match-funded it 50/50 for the first year, that would mean I could do twice as many markets simultaneously from a financial risk point of view.”

What markets should we concentrate on?

Josh Wong reported that many of DLA Piper’s clients are increasingly looking at cities rather than countries when expanding into the international market.

A point worth noting: Josh Wong, Eric Hawthorn and Mike Strawson listen to Clive Memmott’s argument

Are there different strategies for export in the manufacturing and service sectors?

Manufacturing accounts for roughly two-thirds of UK exports, while services accounts for a third, Mr Drinkwater said.

“The services sector is so much bigger than the manufacturing sector within the economy, so how much more can we do to get the services sector exporting?

My view is that it’s actually quite difficult to measure.

“Measuring exports is hugely simplistic, especially in the services sector. It’s much more about measuring the international business that is done, some of which can be done in sterling to a UK business. If I were in professional services and seeking new business, I would be expanding my networks overseas primarily as a means to find new customers as they come to the UK.” He continued: “Many businesses are born global today, right from the word go, especially in the services sector. A lot of this is digital and creative. They can be born global and be selling straightaway to Hong Kong or Japan. But is the service sector still under-internationalised?”

Eric Hawthorn expressed his frustration at the lack of measurement in the services sector. “We know what we export by factoring from the Yorkshire and Humber figures,” he said, “but we haven’t got a clue what the monetary value is of services exports today. It’s very difficult to have a starting point from which to say we’re improving or getting worse, because there are no figures on the service sector.”

Mike Strawson noted the lack of a clear definition of the services sector.

“There are the obvious ones like legal, financial, consultancy,” he said, “but there is a vast array of other services which are producing foreign exchange for the UK and which don’t fall into clear definition.”

Clive Drinkwater added: “We haven’t talked about the training or education sector. When Manchester University opens a new campus in India, is that an export? It’s not counted as an export, but it surely is international business.”

What are the opportunities and what role does online serve?

Building a website to export to the world, Mr Drinkwater said, is an obvious first step – as long as it’s done correctly. “You have to understand the logistics, import tariffs, VAT and local currency. You can work with Alibaba, Google, Yahoo, Ama-

zon – there’s a whole load of people who can provide you with ready-made platforms. Small start-up businesses working from their back room can be internationally exporting from the word go.”

Eric Hawthorn sounded a note of caution, however. “The internet isn’t something that’s core to my business,” he said, “but it’s a powerful tool. While we’re used to shopping on Amazon or using Facebook and LinkedIn etc, some of the growth markets aren’t.

“They’re all very familiar to us, but go to China and there is no Facebook or Twitter, there are Chinese platforms that offer the same services. If you’re going to develop strategies based on the internet, you need to take account of regional differences and how the internet is used in different countries.”

Mike Strawson cited a positive example of a local firm, wholly reliant on web sales. “They have set up stocks in various strategic locations overseas so people can get local delivery,” he said, “and their website is translated into many different languages. The founder has said if it were not for the web they would not be in existence. They’re now a multimillion pound business.”

Josh Wong: calling for clarity

I’m often asked: ‘Where is the starting point for an SME?’

What one piece of advice would you offer to would-be exporters?

Mr Wong said it was critical to find the right partner in your target market and to act with due diligence, while Mr Hawthorn stated the importance of using the support networks. “Had I been more aware of what UKTI and the Chambers did,” he said, “I would have welcomed the opportunity to talk to them before I plunged into the international market.”

Clive Memmott echoed that sentiment, while Mike Strawson advised businesses to translate their websites into several languages. For Steve Cowles, it is all about market research, while Clive Drinkwater had a clear message to potential exporters. “If you limit yourself to selling solely to the UK,” he said, “you are limiting yourself to 0.8 per cent of the world’s population. If you seriously think that’s a growth strategy, you’re mistaken.

“There are huge opportunities out there, the growth is coming not just outside the UK but outside the EU. There will be 8 billion people on this planet in 10 years’ time.”

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The Bolton-to-Beijing challenge personified He may be a UKTI regional director but Clive Drinkwater spans the globe for North West exporters, writes Mike Cowley

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live Drinkwater has a collection of hundreds of “Do not disturb” signs, found hanging on the doors of hotel rooms he has occupied around the world.

The signs not only act as reminders of his former globetrotting business career, but also symbolise unrivalled hands-on credentials for his current role as director of UK Trade & Investment (UKTI) in the North West.

After all, Mr Drinkwater has not only been there – almost everywhere, in fact – but has done that in triplicate in his years as a high-flying business executive.

A social animal with an easy charm, Clive Drinkwater is far removed from the popular concept of a civil servant – but a civil servant he is, albeit one who tends to wear the figurative hat at a somewhat rakish angle. Despite his reluctance to embrace officialdom, he is loving every minute of his time spent helping steer companies around the pitfalls as they take their first hesitant steps along the road to exporting.

Mr Drinkwater likes nothing better than to dangle the carrot that businesses which are doing well exclusively in the UK are serving only 0.8 per cent of the world market. If experience is the yardstick – and it is – then what better guide could they have?

He had to pack his bags and make a hurried exit from China at the time of the Tiananmen Square protests; he escaped from Czechoslovakia as the Velvet Revolution boiled over; he found himself caught up in riots in Bangladesh and was forced to go to ground when students took to the streets in Seoul.

It is having lived through these events – and others like them – that makes Mr Drinkwater so effective for UKTI in the North West. He is always there for the 25,000 businesses on his patch which currently export, and he has set his team of 40 advisers the target of increasing that total by a 1,000 a year.

While issues of confidentiality mean that UKTI cannot always shout about its successes, only recently the North West region was instrumental in landing a £60 million deal for an advanced manufacturing company.

Sometimes the successes are not even heard about until much later. Last Christmas, for example, Mr Drinkwater received a text from the boss of a company with which he had not had contact for two years, revealing that they had just clinched their first deal for £100,000.

And in terms of inward investment – also firmly on the UKTI agenda – there was active involvement in laying the groundwork for the headline-grabbing deal which saw the Chinese take up a 20 per cent interest in Manchester’s new Airport City development.

Clive Drinkwater’s mantra of “Bolton to Beijing” has gone down well with North West business – and there is no lack of appreciation that he is not a faceless bureaucrat who dishes out advice from behind a desk in London, rather someone who has served his time on the export front line.

When he recounts experiences such as overcoming the difficulty of getting a taxi in Moscow by flagging one down with a pack of Marlboro Red cigarettes – though a lifelong non-smoker himself – listeners know it is real. True, this may have happened some time ago, but Clive Drinkwater is well versed in the cultural changes that have taken place in the interim period.

His first job – after graduating in business studies and then getting an MBA – was in a bank, although that was over in the blink of an eye. He then opted to follow the international trade route taken by his father – the managing director of porcelain company Spode – who had spent much of his time abroad building factories, something Clive Drinkwater went on to emulate some years later when he built and ran a plant in Indonesia.

A multi-linguist – he speaks French, German, Russian, Indonesian and has a working knowledge of Chinese – he found his niche in export sales with Johnson Matthey, the global chemicals and precious metals group. His first sale involved going to Paris to offer gold to a group of Moroccans. “It was only worth a few thousand quid,” he recalls, “but I got a real buzz.

“I came out of there punching the air and realising that this is what I really

Clive Drinkwater (centre-left above) makes contact with bosses at home – in this case Glenn Cooper, managing director of ATG Access – before flying out with their message

wanted to do. I later went on to Russia where I did deals worth millions, but it was the same feeling every time.” In the 1980s, Johnson Matthey began to look

at China – as did all its rivals. So Clive Drinkwater found himself sent out there.

When he arrived, everyone was wearing Mao suits, there was no street lighting, the horse and cart was the main form of transport and there were virtually no hotels. So he stayed in a seedy guest house.

As one of the first Caucasians to visit the region, the fair-haired Mr Drinkwater was the object of considerable attention, being referred to as the “white ghost”. People passing in the street would do a double-take. He has similar stories to tell from around the world, as his pioneering role was to open up new markets in developing countries from the Far East to Africa, giving him a first-hand encyclopaedic knowledge of world trade.

Even closer to home, forays into Eastern Europe have shown just how little developed the developing countries really were at the time. “The old joke about the pilot landing in Bucharest and saying put your watches back 30 years was true,” he says. But despite all the traumas encountered with Johnson Matthey, Clive Drinkwater enjoyed every minute.

“If it hadn’t been for that time,” he says, “I wouldn’t be able to do my job today.”

Looking into the MIST

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hile the BRIC counties (Brazil, Russia, India and China) are now recognised as the prime markets for British exporters, Clive Drinkwater has a new acronym: MIST. It stands for Mexico, Indonesia, South Korea and Turkey, the last-named being the one which UKTI’s North West director sees as having the most potential.

His reasoning is simple. Turkey is only four hours from Manchester or Liverpool airports, has one of the fastest-growing economies in the world and is friendly towards Britain. So it is the easiest and most economical in which to get boots on the ground and to start developing the all-important eyeball-to-eyeball relationships.

And the organisation who can make it happen for exporters to Turkey – or anywhere in the BRIC and MIST countries – is UKTI. With more than 1,000 people in 200 locations in 100 countries linked to the UK embassy network, UKTI has a greater reach than KPMG – and the help and advice on offer is free.

The support is greater than that offered by the US to their companies.

Only the French can compete, but this is limited to territories which were once their overseas possessions.

“You cannot underestimate the impact in India,” Mr Drinkwater says, “when key people receive an embossed invitation from our embassy which reads: ‘His Excellency the High Commissioner requests the pleasure of your company’. You don’t turn it down.”

It was worth Not every company is ready only a few for the export market thousand but I punched the air after my first deal One recent approach came from a North West business which recycles wine bottles and turns them into drinking glasses. A preliminary interview revealed this involved a young man and his mother working on a kitchen table. When asked

what his turnover was, the reply was £12,000 – and that was to support two people.

“I told him I thought there was further development needed before he went into export,” Mr Drinkwater said.

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Enterprise

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Switched on to the Far East It began in his Leeds bedroom; now Eric Hawthorn’s Radio Design firm is pushing out across the world, reports Mike Cowley

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s a schoolboy, Eric Hawthorn enjoyed pulling apart electrical things – then putting them back together again. One of his earliest recollections involves an old valve radio which was the pride and joy of his Auntie Anna. He carefully removed all the components, laid them out and cleaned the dust off each one – only to find that something had either been misplaced or moved and then put back in the wrong order. He blames it on the home help.

Anyway, the radio never worked again.

Since then, he has become somewhat more adept on the radio scene and is now one of the world’s leading radio frequency engineers – which, in turn, has enabled him to build a global business: Radio Design, based in Shipley.

Mr Hawthorn has still found the time to throw in his lot with the Leeds City Region Local Enterprise Partnership (LEP) “We are International” initiative, where business ambassadors share their successful experiences. (See below.)

His experience is considerable, as that fascination with electronics led him to take a degree in the subject at Robert Gordon’s Institute of Technology (now Robert Gordon University) near the

family home in Scotland. The course involved communications, which focused on radio frequency. Mr Hawthorn was hooked.

The next 25 years saw him become deeply involved with major companies in the international mobile communications sector. It was a restructuring at Filtronic – also based in Shipley and for whom he was working at the time – that gave him “the kick in the pants” to go it alone.

Timing was critical. The first piece of the jigsaw was to make use of the colleagues who had been let go along with him, a team which in its field of radio frequency was a world-beater.

The second and more crucial element came in the form of a change of legislation – which, for the first time, allowed mobile networks to save money by sharing their infrastructure as the competitive element was no longer about coverage.

“Delivering more and more data for effectively the same price as voice [communications] had become the challenge,” Mr Hawthorn says. “At the end of the day that meant putting more equipment in, much more expensive equipment.

“That put a lot of pressure on them.

So the one thing they could do was share

the infrastructure just like gas, electricity telephone, road and rail – all in a single network.”

Eric Hawthorn happened to know someone who could make the radio frequency filter parts needed for this to happen – himself. Having left his job as global engineering director on the Friday, he was ready to open up Radio Design in his bedroom on the Monday morning.

Around the same time, T-Mobile had already decided to share its infrastructure with fellow operator 3. “I put it to them they should not just share the physical site,” Mr Hawthorn says, “but the antennas and the feeder cables as well. I offered to make a fully integrated product that would allow them to do that very cost-effectively. So that’s what we did. Now 40,000 of these products have rolled out across the country.”

Vodafone and O2 have decided to share as well, with Radio Design named as the supplier. But the story does not end there – that was simply the end of the beginning for Radio Design. Starting with just 11 employees, they now have 270 and have already headed down the export route, opening operations in both India and China. “It was pretty clear to me from an early stage that we were an

Calling the world: The exporting side of Eric Hawthorn’s business has grown from 23 per cent to 43 per cent in three years JERRY HARDMAN JONES

I would have appreciated advice that’s now there...

I had to do it all myself

international company based in the UK,” Eric Hawthorn recalls.

At the end of 2008, Radio Design set up in India. To do this, Mr Hawthorn simply jumped on a plane and began from scratch. Today, Radio Design has 30 people in India and has started manufacturing solely for the Indian market. Then came China, where the approach was to establish a division of the company’s hardware repair operations for base station equipment.

Exports are having an increasing impact on Radio Design’s bottom line.

Three years ago, exports amounted to 23 per cent and the forecast for this financial year is 43 per cent. By next year, the revenue stream will be dominated by a combination of exports and overseas business.

However, while Eric Hawthorn continues to push ahead on all export fronts, he still finds time for his unpaid role as head of international trade at the Leeds City Region LEP. “How I would have appreciated the peer-to-peer advice that is available now through the Export Network,” he says. “When I started, there were so many organisations, I didn’t know which way to turn. The end result was I had to do it all myself.”

‘We are international – and very serious about it’

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ith a £1 billion trade deficit, Leeds City Region seems unlikely to be in the vanguard of an export revival – but it is. Chairman Roger Marsh and his team at the Leeds City Region Local Enterprise Partnership (LEP) have been busy working on a breakthrough initiative, the “We are International“ campaign, which is already showing results.

In the last quarter, Yorkshire and Humberside – of which Leeds City Region is at the heart – has outperformed every other region in the North, showing a positive balance of trade when even the North West remained firmly in the red.

Leeds City Region LEP is working on the principle that the only way to encourage companies to export – and two-thirds do not have exporting as part of their business strategy – is to lead by example. So they have set up an Export Network, made up of ambassadors – business people with a significant track record in exporting and who are prepared to share their experiences.

Would-be exporters can meet the ambassadors – there are currently 30 of them – and obtain practical advice and mentoring support at one of the Export Network’s programme of events. In just three months, LEP ambassadors have helped a Halifax brewing company establish an export strategy, a birth control manufacturer seeking to register

products in the Middle East and a moisturising gel maker who is eyeing-up the Indian market.

Roger Marsh, the former senior partner with PwC in Leeds, is one of the new breed of professionals who head the increasingly important LEPs. And Leeds City Region seems to have stolen a march on the other LEPs when it comes to exports.

“With their remit for setting local economic growth strategies, LEPs can choose to prioritise international trade or not,” Mr Marsh says. “The Leeds City Region LEP decided to take it very seriously indeed. We are the only LEP to have included international trade within our 2012 City Deal with Government, and we will be including it within our Local Growth Fund bid to extend provision

and fill gaps in Leeds City Region.”

So having established itself as the export region of choice, the next step was to achieve results. Enter the “We are International” campaign, with the objective of turning that £1bn deficit into a £1.6bn surplus by 2018. Ambitious? Yes. Achievable? Certainly.

“We can’t achieve this alone, though,” Mr Marsh says. “The key focus of our efforts is working with local partners including UKTI [UK Trade & Investment], the Chambers [of Commerce] and Enterprise Europe Yorkshire, to better co-ordinate export services in response to local need and to identify and fill gaps.”

If you would like to learn more about the “We are International” campaign. please go to www.weareinternational.co.uk

Leeds LEP chair Roger Marsh

Thursday November 7 2013 | the times

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Where far legal jungles are day-to-day business The world’s largest law firm with Northern roots is the exporters’ go-to guide, says Mike Cowley

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hen Sir Charles Lupton qualified as a solicitor in 1881 and went on to become a partner in Dibb Lupton in Leeds, he would have had no idea he was founding what was to become the world’s largest law firm, DLA Piper – where the L stands for Lupton.

DLA Piper now employs more than 4,200 lawyers in 30 countries and has an annual turnover of around $2.4 billion, but remains true to its roots in the North of England, retaining offices in Leeds, Sheffield, Manchester and Liverpool.

Here in the UK, DLA Piper takes particular pride in not being London-centric.

In part, this is no doubt due to the fact that the current chief executive, Sir Nigel Knowles, is from Sheffield and was instrumental in transforming what was then a regional firm into a global entity.

Built through a complex series of mergers, the vast spread of its offices worldwide gives the firm an unrivalled grasp of the intricacies of global trading law and ensures that it is the legal adviser of choice for exporters.

There is little doubt that a number of Northern managing directors can rest easier at night because DLA Piper has helped them to avoid the sanctions minefield through which exporters must pick their way. To ensure this happens, DLA Piper set up a dedicated trade team a dec-

ade ago – and the head of this also comes from Yorkshire.

The team, based in the UK, works closely with its network of specialists based in key trading hubs including Washington, Dubai and Hong Kong. This trade team offers a complete service to aid companies – from product conception and the associated regulatory requirements, through to labelling, export and transacting with consumers.

Sometimes, the DLA Piper team joins clients on the entire journey, while at other times it is called in when an issue occurs and where the company has not been fully aware of the complexity of export and of putting goods to market in a jurisdiction.

The firm also differs from most of its rivals in that it not only opts for lawyers with backgrounds in a variety of countries (see panel on Chinese specialist Josh Wong), but also those who have other business-related qualifications. Typical of these is Emma Thomas, a key player in the 10-strong trade team. She is not only a lawyer but also an economist, which enables her “to appreciate there is a cost to everything”.

The advice she gives is often based on the ever-changing sanctions legislation driven by political and military turmoil around the world. The changing scenarios brought about by the Arab Spring have kept people on their toes, while Iran – where sanctions mean that exporters are in constant danger of falling foul of the law, often with criminal liability, even when goods turn up there “by accident” – is a priority on the DLA Piper radar at present.

The way the trade team operates – and their level of expertise – is reflected in the work they have handled for a client in Not-

We are able to guide the whole process

tingham, where DLA Piper has provided advice over the launch of a new software product into 41 jurisdictions. “From regulatory checking through consumer terms to privacy agreements, we have been able to guide the whole process,” Emma Thomas says.

“All they have had to do to make sure they have full compliance is to contact

An essential link with China

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osh Wong has not only managed to straddle the cultural divide between the UK and China – he has made a career out of it. The son of a first-generation Chinese economic migrant who arrived in the UK in the early 1960s, Mr Wong grew up spending his weekends helping out at the family’s Lotus House restaurant.

His earliest recollection is of eating true Chinese food in the kitchen – simple dishes of steamed chicken and vegetables – while customers tucked into somewhat more exotic if not so authentic cuisine.

Now, just as the Chinese restaurant scene has changed over the years, so too has the business relationship between China and the UK – and Mr Wong has played a role in making this happen.

A fluent Cantonese and competent Mandarin speaker, he studied law at the University of Warwick before joining a London firm as a trainee and being seconded to their newly opened offices in Beijing and Shanghai.

Marriage to Polly from York and the arrival of three small children prompted the decision to head to the North, to access family network support for his wife while he was jetting between the UK and the country of his origins.

He joined the Leeds office of DLA Piper in 2006 and has since built a formidable reputation as a China specialist, helping more than 50 local companies to set up in China and advising more than 50 Chinese companies on investment in the UK. And the two-way traffic has moved up several gears in recent times.

When Josh Wong first took up his role, setting up a company in China would take 12 months and the applicant would have to negotiate with 10 different departments. There was also “discretion”, where companies could be refused a licence without a reason always being given.

Now it takes around three months, there is only one department to deal with and there are no longer any instances of discretionary refusal. Today, if you meet the rules, you get in.

“The regulations have relaxed and the cost has dropped,” Mr Wong says, “which means establishing a presence in China is in the reach of smaller companies as well as the large businesses that we are used to acting for.

Emma Thomas: a key player in DLA Piper’s team dedicated to international work

“It used to be one-way, with China being the factory of the world. Now there is the opportunity for UK businesses to sell to the burgeoning middle classes in China – luxury goods, British design and technology services, legal, finance and education are all very much in demand.”

Despite the new-found ease of access to the vast Chinese market, however, Mr Wong has a word of warning for British businessmen who are in the departure lounge.

“Some experienced business people seem to forget common business sense when they are in China because they are so mindful of the difference between cultures and practices,” he says. “They make business decisions they would never do in this country.

“It is right to respect the Chinese way of doing things, but you should never leave common sense behind.

At the end of the day, what is wrong in the UK is likely to be wrong in China as well – and you should

one point in the UK. Software can be classed as controlled goods, so companies need to be aware of export restrictions – any licensing obligations and transaction currencies and end users.”

DLA Piper works on a range of exportrelated matters, and the focus is not simply on export itself. The firm also assists on regulatory product launches, compliance, privacy issues, trade licences and export licences, controlled goods and IP (intellectual property) issues It is undoubtedly the wide reach of DLA Piper that ensures it keeps ahead of its rivals. “The benefit of having a global law firm with experts in each jurisdiction means we are able to act very quickly for clients to mitigate any harm and liability,” Emma Thomas says. “We also often advise concerning more efficient ways to conduct business globally.”

But she maintains that being the largest does not equate to being the most expensive in real terms. “There is a misconception that a global firm means global fees,” she says.

“We do these sort of transactions on a day-to-day basis, so there is a lot of efficiency there. Whereas if you go to a smaller firm without the experience, it is going to take them a lot longer.”

And time – as Northern firms know – means money.

Josh Wong always be on your guard if someone tries to persuade you to do something or to take a deal simply on the basis that ‘This is the way we do things in China’.”

the times | Thursday November 7 2013

7

Business Insight

Guarantees

DEVEL EXPO OPING R

Help that makes the difference

TISE

...between winning and losing contracts.

It comes from UK Export Finance, which champions exporters, says Barry McDonald

E

xporting is not only a vital engine of growth for the UK economy, it also brings positive benefits for individual companies by making them more productive, more innovative and more profitable.

If you are planning to export goods or services from the UK, it is likely you will need some form of credit guarantee or insurance to protect you against nonpayment or other financial issues. And if you are unable to get what you need from the private market, UK Export Finance (UKEF) may be able to help.

UKEF can often mean the difference between winning and losing export contracts. “We are here to provide support, primarily in the form of guarantees and insurance to help exporters win contracts overseas and secure payments,” says David Godfrey, chief executive of UKEF. “We are here to complement the private market, not to compete with them, and so we tend to operate in regions where the private sector is not providing that kind of support.

“For instance, you might have traditional credit insurers who choose not to insure certain areas or risks. That’s where we are available to companies.

We will provide the support the private sector doesn’t meet, so it’s very much a complementary service to the provision of export funding and export support.”

UKEF has a particular interest in helping more SMEs (small and medium enterprises) to export from the North of England. Over the past few years, UKEF has launched a suite of products and a new network of advisers in every region of the UK to help improve the knowledge of, and access to, trade finance in SMEs and mid-sized companies. Around 100 exporters, including almost 80 SMEs, have been helped by UKEF to fulfil contracts worth over £730 million, and hundreds more have been helped through the supply chains of larger customers.

Ensuring that more companies enter the export market is vital to the economy, according to Mr Godfrey. “It’s absolutely critical,” he says, “because part of the Coalition’s plan for recovery is that we should have a more balanced economy, balanced with a manufacturing sector that is vibrant and healthy. Part of that is more manufacturers exporting to target and growing markets, rather than relying on the domestic sector.

“The Government’s aspirations are to double UK export by 2020. The big companies already know these markets, it’s really going to depend on medium-sized and some small enterprises being confident about their ability to find opportunities in export markets.”

With a growing global population and proliferation of emerging markets, it can seem like a minefield choosing a country on which to concentrate. “Our exports have very much been orientated towards the US and the EU,” Mr Godfrey says. “The EU has gone through some economic difficulties and it’s important to look at markets such as Turkey – the youngest population in Greater Europe and expanding at a significant rate.

“China, India and Malaysia are the other obvious ones, and there’s a lot of construction going on in the Gulf. That’s where a lot of the growth is, and it’s where we’re seeing a lot of the requests and opportunities for support, because in some of those regions the private sector has that limited-risk appetite and that’s where we can step in and help.”

There can be many barriers to exporting, especially for SMEs with little experience. While a lack of access to finance may seem the obvious obstacle, Mr Godfrey believes a lack of familiarity and confidence about expanding overseas is their main hurdle. “If you are Rolls-Royce or Airbus,” he says, “you know all about the foreign markets and have a huge staff that understand the regulatory environment in Russia or China. But a medium-sized enterprise doesn’t know the complexities of dealing with a particular country.”

To illustrate his point, Mr Godfrey gives an example of a medium-sized UK exporter which recently won its first exporting contract to a former Soviet country. “It was their first contract in this country and was building its export capability,” he says. “But it had to prove a guarantee for performance in favour of the local buyer. Right at the last minute they were told by the ministry that this bond had to be issued by a local bank.

Being a UK exporter, they didn’t know any local banks and the local bank didn’t know them. All of a sudden they found it extremely difficult to complete this contract.

“I’m sure they got there in the end, but those are the kind of things that smaller UK companies are concerned about: local conditions, local law, local partners,

David Godfrey, UKEF’s chief executive: ‘We complement the private market’

local regulatory and environmental requirements. Those are the things that are challenging and the things our sister department, UKTI [UK Trade & Investment], can help with.”

A combination of advice, research and mentoring is the key to overcoming those barriers. “The challenge for us,” Mr God-

frey says, “is a joined-up offering of Government departments, including UKTI and UKEF, so smaller companies that don’t have the infrastructure of RollsRoyce feel they have a partner when they come to target and look at new markets.

“The message is we’re very much open for business.”

How Vee Bee filtered West

U

K Export Finance and HSBC Bank worked together to help Vee Bee Filtration of Stourbridge secure contract bonds for a large oil and gas contract.

Vee Bee Filtration is a familyrun industrial filtration company, based in Stourbridge in the West Midlands. The company has over 60 employees and more than 90 per cent of its business is overseas, mainly in the US, the Middle East and the Far East.

In 2012, Vee Bee won a £1.67 million contract with a large US construction and engineering business to provide a bespoke filtration solution for a liquefied natural gas plant in Australia. The company’s filters would protect equipment worth millions of dollars from potentially harmful debris in the liquid gas. However,

some of the financing needed to secure the contract was potentially problematic.

“Our turnover in 2012 was £6.4m,” says Nikki Reynolds, finance manager at Vee Bee, “so a single contract worth £1.67m is very significant. We already had a £1m bond facility with our bank, but the size of the bonds required for this new contract would have strained our finances too much for comfort.

“On top of this, we needed to buy the materials for the filters, as well as pay some of our subcomponent manufacturers, and this outlay would have prevented us from accepting other contracts that we were bidding for.”

Vee Bee already had a relationship with UKTI, who introduced them to UKEF. In October 2012, when the company’s existing bank

was unable to increase the bond facility, an approach was made to HSBC – which was prepared to offer a £2m bond facility so long as UKEF shared half of the increased risk.

Vee Bee joined HSBC in December 2012 – and, with the help of UKEF, applied for bond funding in January 2013. HSBC agreed to issue two standby letters of credit, a preferred method of guarantee in North America.

These letters of credit were in place in March 2013, so the company could invoice their client for its upfront payment and buy the supplies needed to start work on the contract.

Thanks to this new contract and others in the pipeline, Vee Bee expects a turnover of £10m in 2013 and 2014, almost twice that of 2012.

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the times | Thursday November 7 2013

9

Business Insight

City revival

Unleashed wave of new enterprise will boost regeneration Nottingham is a city steeped in history but with its focus on the future, writes Barry McDonald

I

t is a city with a vibrant mix of medieval and modern, and can boast some impressive assets – including two internationally renowned universities, several first-class theatres and concert halls, the National Ice Centre and Trent Bridge cricket ground. It is also one of the cleanest, greenest and least car-dependent cities in the UK. Like every major centre in the country, Nottingham’s assets have not provided immunity to the economic downturn, but the city has developed an innovative strategy for recovery and growth. The Nottingham Growth Plan, launched in 2012, sets out an ambitious and long-term strategy for economic development and job-creation to reinvigorate the city’s fortunes over the coming decade.

The growth plan established a series of measures for driving forward the city’s economy. It is the fruit of a collaboration between some of Nottingham’s key public and private sector organisations and is based on solid academic research, good business sense and valuable consultation. It is ambitious but achievable, and holds the key to creating significant growth across Nottingham – unleashing enterprise that will bring benefits for generations to come.

Like most good ideas, it was born out of necessity – but also a out of a desire and a willingness to see the city thrive in the face of economic uncertainty. “It started off as a response to the recession, a time when you should plan for growth,” says Councillor Graham Chapman, deputy leader of Nottingham City Council. “We had two options: we could simply retreat or plan for growth.” The latter, he says, was the “right thing to do”.

The kernel of the growth plan was formed not in the city’s council offices or boardrooms but in the great English countryside. “It actually started when Jon Collins, the leader of the council, and myself went for a walk in the Lake District,” Cllr Chapman says. “We were halfway up a hill and we both decided the city needed a growth plan. The idea was also greatly stimulated by the vicechancellor of [Nottingham] university.”

It has now been 16 months since the launch of the initiative – and while it is

Since its launch in July 2012, the Nottingham Growth Plan has notched up some notable achievements –

The creation of 200 apprenticeships.

1,489 people have been helped into employment as a direct result of growth plan projects.

8,948 jobs either created or earmarked for creation.

very much a long-term growth strategy, the city is in the “foothills of success”, according to Cllr Chapman. “We’re on our way, but we have a long way to go,” he says. “The foundations are in place.”

There have been some notable successes in those 16 months, including the main economic action zones: the Boots site, MediPark and the Business Park – along with the city’s new Creative Quarter at the old Lace Market. “We’ve already had someone from Leeds who has relocated to the Creative Quarter because of the infrastructure and incentives there,” Cllr Chapman says.

860 homes built in Nottingham.

An 8 per cent fall in city centre shop vacancies, with the Broadmarsh Shopping Centre seeing vacancies down by 17 per cent.

More than £50 million of business finance secured.

The results of that bold intent, and of significant investment, are now emerging: business growth, job creation and new growth sector centres.

The straightforward message that Nottingham is “open for business” is certainly reaching a national and international audience. Behind that message is the story of a city that believed regeneration alone would not be enough.

Rather, to succeed, Nottingham had to rebalance its economy and focus on new areas of enterprise.

Since its launch in July 2012, the growth plan has made over £49 million of finance available to Nottingham

Dynamic design at Nottingham University reflects the spirit of the city’s Growth Plan

We have a long way to go but we are on our way

businesses, with a record 3,762 new companies formed in the city in 2012.

Notably, the city has seen the start of several major developments, including the Boots Enterprise Zone and the £570m expansion of the tram network – which will more than double in size, with passengers benefiting from 11 miles of new track and 28 new stops.

Transport has been one of the key pillars in supporting the city’s economic growth. Nottingham already boasted a tram system and the largest public bus company in the UK, which led to it gaining the accolade of Transport City of the Year 2012. The city council is investing heavily in new infrastructure, with £750m being spent on highprofile transport schemes to improve connectivity. This investment will bring huge benefits to Nottingham, creating immediate job opportunities in constructing these projects while also attracting inward investment and growth in the city’s economy.

“There has been major investment in the city’s transport infrastructure,” Cllr Chapman says. “We have two new tram lines, a new station and the widening of the A453 [the main route to Birmingham] and ring road. We already had plans for transport infrastructure, because our view as a city council is that our job is to provide the infrastructure and the private sector’s job is to provide the conditions for growth.”

The strategic focus of the growth plan is on developing industries where the city already has a competitive advantage, including life sciences, digital, and clean technology. To ensure that businesses flourish, the growth plan also targets areas with significant barriers to growth – by supporting enterprise, the development of a skilled workforce and building a 21st-century infrastructure.

The city’s regeneration project includes an ambitious £35m council house development programme, the largest council home-building programme in Nottingham for 40 years.

Other partners are planning significant new development schemes, such as Blueprint’s redevelopment of the Trent Basin area and UK Regeneration’s investment in over 200 new homes at the planned Sandfield Centre urban village.

The substantial investment by Nottingham’s two universities (the University of Nottingham and Nottingham Trent University), and the opportunities they provide in terms of training, research and job-creation, are also major contributors to the economic success of the city.

The growth plan is very much a long-term strategy, and Cllr Chapman admits it is “no quick fix” – but he is evangelical about the city. “In Nottingham,” he says, “you get a lot of the benefits of a very large city in a much more intimate setting, where labour costs, land costs and transport costs are a lot lower than elsewhere.

“There’s enormous potential here.

You have a location outside London which has all these facilities, including the Test ground, the National Ice Centre, two theatres, a concert hall and two world-class universities. It also has one of the youngest populations of any UK city.”

Sixteen months into a 10-year plan, and the city is changing. The future, Cllr Chapman believes, is an optimistic one for Nottingham. And it would be hard to argue.

Thursday November 7 2013 | the times

10

Business Insight

Forum Nottingham’s Growth Plan

Ideas boost big drive to

A ‘different’ economic strategy was the topic for scrutiny at a Forum from The Times. Barry McDonald reports

L

ast year, Nottingham embarked on a long-term and ambitious growth strategy. Our Forum panel gathered at the headquarters of Nottingham City Council to discuss the plan’s progress and the opportunities for future growth.

Three sectors – digital content, life sciences and clean technology – were identified as playing a major part in the growth plan. Should they continue to do so?

From the city council, Nick McDonald stated that the idea behind the Nottingham Growth Plan was to indicate how the city’s economy would develop over the next 10 years. “The intention is not that everything revolves around digital content, life sciences and clean technology,” he said. “If we’re going to get a substantial volume of jobs in the city in addition to the jobs that are already there, we’re going to have to look a lot wider than these three sectors.

“But we do have real substance in these sectors. We pick these sectors because they say something about the city’s strengths now, but they also say a lot about where we want to go, how we want to rebalance the city’s economy – an economy which is 90 per cent service sector to an economy much more focused on designing and making things.”

David Browning, the recently appointed director of MediCity, agreed.

“These sectors are where the city has real strength,” he said. “They are the industries of the future.”

Mike Taylor, from Nottingham Regeneration Ltd, was keen to point out that while these three key sectors are vital for the city’s economic recovery, it is also about looking at the wider economic picture. “There are a host of other sectors and it’s important we put things in perspective,” he said. “We have a whole raft of indigenous industries in this city. Retail and financial services are big employers and we shouldn’t ignore their potential. The growth plan is but one aspect of the economic strategy.”

Professor Baback Yazdani, dean of the Nottingham Business School, added: “Focusing on three sectors of future development does give us focus.”

One of the flagship initiatives of the growth plan is the Creative Quarter.

Does it set out the city’s ambitions?

Cllr McDonald believes this is an example of the way in which the city is taking a different approach to economic growth. “We’re trying to use the opportunity you have in a recession to do things differently,” he said, “and to apply different methodology for economic development.

“The Creative Quarter is not a particularly original idea – the idea of entrepreneurial clusters is pretty standard.

Geographically, the Creative Quarter is the area where we have a lot of businesses, including Antenna, a creative in-

Retail and financial services are big employers and we shouldn’t ignore their potential

The Forum was chaired

by Alasdair Nimmo of The Times

dustries hub, and a number of different incubator units. We’re already seeing a difference in that area of the city just in terms of the vibrancy.”

Professor Yazdani argued that physical cluster of creative businesses provides a positive focal point for new businesses to emerge. “At both universities,” he said, “we are generating huge amounts of talent. For example, in our university we have one of the best schools of art and design in the country. Some of the graduates stay and the Creative Quarter gives them some sort of avenue to be exploited in a positive way, so the talent that’s generated here remains here.”

Mr Taylor added: “It’s important that it’s not just a physical regeneration project. It provides a focus for likeminded businesses to cluster and spark off one another. That’s what the area is about. There’s a Further Education college right in the middle of it and that’s critical.”

The Apprenticeship Hub is another key pillar in the growth plan. How important are apprenticeships in driving long-term employment?

Apprentices, Cllr McDonald believes, are absolutely vital to the success of the plan.

“We have a decent record over the last couple of years,” he said. “The apprenticeships increased by over 10 per cent in Nottingham last year, while it went down nationally. The reason that’s the case is because we really made an effort – not just the council, but businesses too – to push this agenda.

“If we can show we’re a beacon city for apprenticeships, that will say a lot about the kind of climate we’re trying to create.

The apprenticeship route has been seen as a second-class option and we need to address that in the UK. The way to address it is by ensuring the apprenticeship offer is as good as it can be and is seen as a really good option for people. If we don’t get that right, we’ll continue to have a skills deficit.”

It’s a long-held view, Professor Yazdani added, that apprenticeships are a secondrate route to employment – and a view which must be addressed. “It’s a problem for the UK, not just for Nottingham,” he said. “A vocational profession is not seen to be as good as other professions. Employers are extremely positive about apprenticeships because it allows them to bring a younger person in, train them and grow them into the business.”

For Mr Browning, the aspiration at MediCity is to encourage start-ups to develop to the extent that they can offer apprenticeships. “I’ll certainly be encouraging our residents to offer apprenticeships as a significant vehicle,” he said, “not just for manufacturing jobs but also for other roles within research and development.”

There were concerns, however, for Cllr Graham Chapman, deputy leader of the city council. “There is an issue of quality of apprenticeships, because that term is thrown at anything that involves some training,” he said. “There’s an imperative to upgrade what apprenticeships mean.

There are some kids being put into apprenticeships which are six months long and they’re not learning an enormous amount.

“It also has to be demand-led. And a lot of these kids are not even fit for apprenticeships, they need pre-work experience and there’s a huge raft of young people in every city that don’t even appear on the unemployment stats. They need to be got at as well, because a lot of them are quite capable.”

There is a raft of stakeholders involved in implementing the growth plan. Has Nottingham got the right balance, and are the stakeholders working well together?

Professor Yazdani argued that the relationship between the public and private sectors has improved in the last couple

of years. “The public agencies, the city and county councils, businesses and universities are working together and talking to each other on a regular basis,” he said.

“The political leadership of the city is becoming more intertwined in terms of getting major things for the city done.

The benefits of this are showing. At the end of the day, we are all major players in the city.”

As a newcomer to the city, David Browning agreed. “Having recently relocated to Nottingham, one of the things I’ve been excited about is that I do see this cohesion. There’s a real centre of gravity here.”

Cllr McDonald expressing his belief that the plan must encompass many stakeholders

the times | Thursday November 7 2013

11

Business Insight

realise a city’s promise Who was who on the panel

Mike Taylor added: “When I first came here four years ago it was not as welldeveloped as it is now. There’s much more of a culture of embracing the private sector from the local authority. I think the LEP [Local Enterprise Partnership] has forced us to work in a more collaborative way – and I think it’s started to reap the benefits.”

Cllr McDonald emphasised that the growth plan had to encompass many stakeholders. “We were very clear when we started to write the growth plan that it mustn’t be a city council plan,” he said.

“If it had been a city council plan, firstly it wouldn’t have been anywhere near as good, secondly it would have been shot at by the business community, and thirdly we wouldn’t have been able to deliver it.

“We were very clear from the outset it was to be a city plan not a city council plan. The experience of developing and starting to implement the growth plan has been a positive one.”

What has been the success story of the growth plan since its launch 16 months ago?

“We just did an annual review of the growth plan,” Cllr McDonald said, “and what it’s telling us is the success story has been business finance and business support. We’ve completely changed the landscape in terms of access to finance for small firms.

“This time next year I think the success story will be about infrastructure, because we’ll be completing a number of major infrastructure projects.”

Mr Browning added: “There’s real momentum here – and, as far as I un-

Exchanging creative thoughts (from left): David Browning, Mike Taylor, Dr Dan King and Councillor Nick McDonald

We have completely changed the landscape in in terms of access to finance for small firms

Councillor Graham Chapman, deputy leader of Nottingham City Council and regeneration portfolio holder

Professor Baback Yazdani, dean of Nottingham Business School, Nottingham Trent University

Councillor Nick McDonald, portfolio holder for jobs and growth, Nottingham City Council

Mike Taylor, director of regeneration for the ‘delivery vehicle’ Nottingham Regeneration Ltd

David Browning, director, MediCity – a health and wellness business incubator

Dr Dan King, head of knowledge transfer, Business Engagement and Innovation Services, University of Nottingham

derstand it, Nottingham previously had a poor availability of investment for entrepreneurial companies and that’s really changing. Today, the funding level per head of population is among the highest in the country.”

An improved transport infrastructure is a major part of the growth plan. Will it be delivered on time and will it have the desired impact?

As someone who works in the city centre, Cllr McDonald argued that there is genuine excitement about the completion of the new transport infrastructure.

“All of these things will be hugely beneficial to the city,” he said. “The tram is on time, on budget and on schedule.

We recognise it’s hugely disruptive to people at the moment, but it can’t be done any other way.”

Mike Taylor noted that the benefits are already beginning to kick in. “Sites are starting to be prepared for when the infrastructure is up and running,” he said. “People are buying sites and starting to develop in readiness. From a regeneration point of view it’s doing exactly what it says on the tin.”

Professor Yazdani gave his thoughts on the wider picture: “These activities are important for us to be competitive, and we’ll be given a competitive advantage when it finally takes shape – but we also need to compete at an international scale. I’d like to see HS2 [the High Speed 2 rail line] here in five years’ time rather than 20 years’ time.”

Dr Dan King of the University of Nottingham pointed out that improved

infrastructure is vital to creating a positive impression of the city – an impression which could have major consequences. “Our university has campuses in China and Malaysia,” he said. “Each year when those students are graduating, their parents and families are coming and there is a focus on the city – and these infrastructure projects mean those visitors will see Nottingham in a completely different light and enable them to go back as ambassadors for the city.”

Professor Yazdani added: “These people will be the business leaders and decision-makers of their countries.

They’re occupying increasingly senior positions and that’s a huge leverage for investment in Nottingham.”

Nick McDonald chipped in again.

“The prime minister of Malaysia [Najib Razak] went to Nottingham University and there are senior ministers in the Indian government who graduated from Nottingham University.

“Nottingham is about realising potential. We’re bang in the middle of the country, a perfect place to have a UK hub – but unless you have the routes in and out of the city you’re not able to realise that potential.”

What one radical activity could benefit the city in the long term?

Cllr Chapman admitted it was “bluesky thinking”, but said he dreamed of promotion for Nottingham Forest FC. “It gives you branding across the globe.

But it won’t happen, that’s why it’s blue sky.

“Seriously, though, something to happen to the airport – so we can start getting decent flights to some of the major hubs like Dubai – would be fantastic.”

Dr King talked about keeping hold of some of the city’s talented graduates.

“There are things we can do to maximise student retention,” he said. “It might be about their employability and connecting to local businesses, but we need to keep them coming back or staying in the city.

“If we can give graduates ‘stickiness’ in terms of their own business connections, perhaps they are more likely to work in the city or to start up a business in the city.”

Mr Browning added: “Something we lack at the moment is a major independent research centre. If we could attract something like that to set up here it would help things.”

Professor Yazdani noted that reputation was vital. “What would be fantastic is to become known as the innovation city,” he said. “If we can create a reputation in Nottingham as a city of innovation, that would be something that everybody could relate to.”

And there was agreement from Cllr McDonald. “We want to be able to say Nottingham is a beacon city for creativity and innovation,” he said. “We have one of the youngest populations outside London – that has to be harnessed. We need to be known as a city that is keeping its talent and using that talent to drive innovation and creativity.

“It’s not going to be straightforward, but I think we have the right ideas in place.”

BUILDING A BETTER NOTTINGHAM £1 BILLION IS BEING INvESTED TO TRANSFORM NOTTINGHAM’S FUTURE £750m on new transport infrastructure

8,000 jobs could £55m to build result from the new energy tram extension efficient homes

Find out more about business opportunities in Nottingham at

www.investinnottingham.co.uk

£43m for new state-of-the-art leisure facilities

the times | Thursday November 7 2013

13

Business Insight

Financing ambition and inspiring entrepreneurs As the largest fund of its type in the UK, The North West Fund has been set up to create a lasting legacy for businesses in the region.

The £155 million investment fund is now nearly three years old and has already built up a strong portfolio of growing businesses

T

he business and entrepreneurial talent in the region is impressive, and The North West Fund is available to support these growing businesses with the finance they need, so that they can realise their ambition and possibly move into new markets.

The Fund has invested over £60m in more than 200 businesses – and, in doing so, has been able to create and safeguard a significant number of jobs in the region, as well as providing finance and support to create over 40 new businesses.

The Fund, which is financed jointly by the European Regional Development Fund and the European Investment Bank, supports SMEs (small and

medium-sized enterprises) across the North West, with investments of between £50,000 and £2m. The investments are made through six sub-funds, each managed by a specialist fund manager.

Customs authority chooses Loksys Solutions to help track transit cargo

One of the world’s leading trade inspection, security and certification companies, Cotecna del Ecuador, has adopted the Manchester-based Loksys Solutions Ltd’s Trakalok device to monitor movement of freight containers between Ecuadorian ports, warehouses and free zones.

Loksys Solutions, based in Trafford Park, has developed an innovative sys-

tem for securing freight containers. The system combines a tamper-proof lock with a GPS (global positioning system) tracking system, enabling containers to be securely locked and monitored throughout their journey.

The business was set up by entrepreneurial brothers Simon and Ian McDermott – who, earlier this year, secured a £500,000 investment from The North West Fund for Venture Capital, managed by Enterprise Ventures. The investment is allowing the company to develop the product further, to increase sales and marketing activities and to recruit additional staff.

“The finance and support from The North West Fund is allowing us to grow our business as we had hoped,” Simon McDermott says. “The Trakalok device can now be found monitoring cargo movements in all four corners of the world, and is making Loksys Solutions a truly global business.”

Acoustic Sensing trials SewerBatt in Australia

Daresbury-based Acoustic Sensing Technology (UK) Ltd has undertaken Australian trials of its innovative product, SewerBatt – a low-cost acoustic

Co-founder of Loksys Solutions, Simon McDermott technology product which assesses the condition of sewer pipes. The innovative technology allows the user quickly and accurately to measure the acoustic signature of a pipe, to determine the severity and location of any defects.

In spring 2013, the company secured a £650,000 equity investment from The North West Fund for Energy & Environmental, which is managed by 350 Investment Partners. The investment was used initially to bring the product to market, and since launch the company has been focusing on selling SewerBatt to water companies and contractors in the UK, Europe, Australia and the US. The firm’s chief executive Nick Hawkins works closely with the team at The North West Fund. “It has been a pleasure working with The Fund,” he says. “The team has been incredibly sup-

DOES YOUR BUSINESS NEED FINANCE? We have already supported over 200 businesses with more than

£60 million of funding and we’re looking for more businesses to invest in.

So whether you are just starting up or seeking funding to help take your company to the next level, investment of between £50,000 and £2m from The North West Fund could be what you need to help your business flourish.

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Could you be our next investment?

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portive and we are already pleased with the company’s growth.”

Michael Bakewell, investment manager at 350 Investment Partners, joined the company’s board as a non-executive director. “The SewerBatt is already proving to be beneficial to water companies here in the UK,” he says, “and the trials in Australia will hopefully lead to further sales and export opportunities for the company.”

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the times | Thursday November 7 2013

15

Business Insight

Management

Driving innovation Recession? This top Leeds firm just kept on fast-lane motoring, says Barry McDonald

D

espite the economic downturn, one company has motored through the recession, posting 24 years of continuous growth.

Zenith, a vehicle leasing and fleet management firm, has bucked the trend and enjoyed year after year of success.

“We’ve had the ability and flexibility to evolve, adapt and re-invent the business’s structure to allow for the ever-changing market place,” says Ian Hughes, the commercial director at Zenith.

“We don’t have the dependency on one particular component of our sector, and that has enabled us to spread our wings and get smaller revenue incomes, but from a much wider portfolio base. That still drives the bottom line.

“We want to drive innovation for both our customers and ourselves. An example of this is that we haven’t increased the amount of people within our purchasing department – who arrange for all the vehicles to be ordered and delivered. There is still the same headcount as there was three years ago, yet they’re now delivering and transacting four times as many vehicles.”

Zenith manages over 40,000 vehicles and all core services are operated inhouse. “Our products and services are all geared towards a dedicated focus on midto-large blue chip corporate customers,” Mr Hughes says.

“The principle of the strategy is that we have chosen, unlike some in our sector, to in-source all the technical competencies around fleet, to allow our customers to out-source their requirements to us. That means we are able to provide all products

Zenith commercial director Ian Hughes and services from under the one roof at Zenith.

“That includes vehicle hire, accident management, fleet management, leasing, salary sacrifice, licence checking and even developing into telematics. We do the full spectrum of services all under the same roof.”

Recognising that innovation is a key factor in the company’s continuous success, Zenith developed Pulse, its own multi-award-winning online diagnostic platform that gives customers access to a centralised business intelligence database.

All aspects of every single transaction connected to vehicle operation can be viewed at the click of a mouse. The system gives the data in real time, instantly providing information on key areas including orders, delivery status, CO2 emissions, terminations, accident statistics, hire car spend, fines and customer satisfaction.

Pulse is developed in-house and is continuously evolving, with new capabilities and functions being added all the time.

“Our primary focus is to help and support customers, prevent cost leakage, drive additional value in terms of policy changes and product evolution for them,” Mr Hughes says. “We’re continuously interrogating the data to ensure that we’re adding value during our contract.”

Zenith was established by a team of eight people and will celebrate its 25th anniversary next year. The company provides vehicle leasing and management solutions for company cars, commercial vehicles and all employee vehicle-based benefits, such as salary sacrifice. Its customers are primarily mid-to-large corporates, including many household brands such as Asda, Santander and Philips.

Zenith delivers innovative vehicle solutions to any employee population within its target market and provides a wide range of funding and fleet management products. It caters for traditional company cars, commercial vehicles and all employee vehicle benefits, as well as standalone solutions such as accident management and hire cars. Zenith’s salary sacrifice car scheme product is continually growing in popularity and allows employees within a company to exchange part of their salary for a company car, saving on income tax and National Insurance.

From those humble beginnings in 1989, the company has grown and now employs 220 people at its base in Calverley, to the north-west of Leeds.

“This is where our ancestral home is and we’ve always grown as a Leeds-based company,” Mr Hughes says. “The thing we’re very proud of is the fact we are able to, from our premises, compete on a pound-for-pound basis against national competitors. Our geographical position has never held us back in any shape or form.”

We want to drive innovation for both our customers and ourselves

As if to prove that pride in its geographical heritage, Zenith is a company which takes its corporate social responsibility seriously. It is working with the Ahead Partnership to take part in voluntary community-focused projects, thus assisting with the social and economic regeneration of Leeds.

The Ahead Partnership provides access to programmes and initiatives in some of the most deprived areas of the city. Specific events include improving and maintaining a conservation area, and volunteering in local schools. Zenith employees also visit elderly people in the local community to provide training on computers and use of the internet, and the company has sponsored a local initiative to encourage growing of edible plants.

Three years ago, Morgan Stanley Private Equity acquired a 60 per cent stake in Zenith, a deal which provided the management team with enough support to expand the business organically. That was soon followed by a string of accolades, including winning the Fleet News Leasing Company of the Year award in both 2012 and 2013.

Recently, the company launched an online commercial vehicle build management tool for use by its customers.

This has been designed to help ensure that the commercial vehicle build cycle is managed as efficiently and costeffectively as possible.

The new tool works by tracking every stage of a commercial vehicle’s build management programme. As the vehicle moves through the programme, its status is updated in real time. Any delays are highlighted immediately and the effects can be mitigated, with the programme realigned and areas targeted for improvement, whether this be a supplier, equipment or process enhancement.

Zenith has also just launched E-Motion, a comprehensive range of services to encourage and advise on the use of electric vehicles. This follows 12 months spent researching and analysing the relative capabilities, cost and environmental benefits across the various technologies now available.

As part of its strategy to deliver firstclass customer service, Zenith has recently developed ARM (Any Relationship Management), which is an in-house-built, bespoke platform to manage a wide range of interacting relationships.

“It’s all about providing the best service we can for our drivers and customers in a seamless way,” Mr Hughes says. “It also helps us to manage our relationships internally, across our 13 different departments, bringing together our internal systems and processes. When a driver calls, the system recognises who they are and any services they require are immediately highlighted.

They are greeted with a personal response that creates an environment of high-quality customer service.

“We are able to book services, MOTs, hire cars etc all within one central system, and keep track of all historic transactions and calls. It also creates cost efficiencies for us as a business, reducing workloads and time and enabling us to focus more investment on continued innovation and improvements.

“Our business model is founded upon good customer service. Everybody says that, but our platform is an award-winning CSI [customer satisfaction index] platform. Today, 89 per cent of our customers are completely satisfied – and that’s all down to our people.

“Without the high-quality staff, we wouldn’t be anything like the business we are. We’re very proud of them.”

Fleet management without the ups and downs.

At Zenith we see things differently.

We think that our customers should be in complete control of their vehicles and their drivers, so we’ve invested in the technology and systems to help them do that.

enquiries@zenith.co.uk

And when that’s on top of our continued commitment to customer service, it’s easy to see how Zenith’s customers have the smoothest ride, without the ups and downs often associated with vehicle leasing. Since 1989, we’ve focused on high quality service, innovation, agility and drive and we’re proud of what we’ve

www.zenith.co.uk

PROVIDER TO

WINNER

been able to provide to our customers.

As the first company ever to win the Fleet News ‘Leasing Company of Year’ two years running, we want to help you see fleet the way we do. It is not like everyone else.

Find out what we can do for your company today.

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