How small fish compete in the global pond SMALL COMPANIES
QUEEN'S AWARDS A SPECIAL REPORT Innovation and initiative allow small companies to enter the world export market, writes Lynne Curry Smaal
Friday 21 April 1995
Almost a quarter of the awards have gone to companies with fewer than 50 employees, and many of those have fewer than 20. For some, staying small is their strength.
EuroTalk, which makes language-learning CD-Roms starring the French cartoon character Asterix from its base in Fulham, augments its core staff of seven with more than 40 linguists, artists and technicians when it is making a new CD. It now produces 17, including eight for learning English, five French and two Spanish.
EuroTalk was set up by Richard Howeson and Andrew Ashe in 1990, as a breakaway project from their existing business. Their most expensive starting investment was royalties for Asterix, but now their CDs outsell Asterix publications in some countries, including Japan. "The idea of these CDs is to encourage people to speak," Mr Howeson said. The CDs are now exported to 30 countries, including Russia and India.
Small is the essence of the Brompton Bicycle Company. Its bikes fold in less than 15 seconds to the size of a small suitcase. They can be taken on to buses, trains and aircraft as luggage. The fascination for the bikes has been a great export strength for the firm, says company administrator, Nicola McGregor: "We don't do much marketing. In the Netherlands, one of our two main markets, our two distributors are absolutely sold on the bicycle and do it for us. We're a very small company; it's difficult enough keeping up with demand for the bikes."
Annual production is now approaching 5,000, with 60 per cent going abroad. Small does not come particularly cheap, however, with the range starting at £364.
When a French wine-lover wants to acquire a '45 or '61 Bordeaux, it would seem logical that the easiest place to acquire it is France. The fact that this is not the case has helped the success of Farr Vintners, of Pimlico, for which France is the strongest export market - usually of French wines. Now with a staff of 14 people, the company was set up by Lindsay Hamilton, fresh from Harrods wine department, and Stephen Browett, a French graduate who once drove a van for a wine shop, to specialise in fine wines.
Its turnover last year was £15.25m, with the average price per bottle £30. "The French can be quite chauvinistic," Mr Browett said. "If you're a wine merchant in France you only tend to sell wine from your particular area. If a wine merchant from Tokyo or New York wanted 10 cases of different vintages, they'd have to go to many different suppliers in France, but would only need one in England." Farr now exports wine to the Far East and the USA as well as Europe.
The small world of parasites and predators has brought business success to an entomologist, an agronomist, and a plant pathologist. Dr John Dale, Phil Walker, and Dr Robin Penna breed mites and parasites to tackle the red spider mite which bedevils greenhouse crops, the western flower thrip larvae, which attacks sweet peppers and flowers, and whitefly, which wreaks havoc on aubergines and other crops.
Biological Crop Protection (BCP), of Ashford, Kent, works alongside Wye College, London University, to find and breed natural predators. Nigel Jupe, an agriculturist who moved from the other side - the chemical pesticide industry - and the fourth director, said engineering a natural process could be complex. "Harvesting the insects is particularly tricky. Sometimes you can get them to come off themselves but sometimes you actually sell the culture as it is."
BCP, which has grown to 35 people, is now one of three major producers of natural predators. It began to export in 1988 and is strong in Belgium and Holland, where it works alongside Biobest, a producer of bees for the pollination of crops.
Mr Jupe said: "Over the next 20 years we expect biological control to increase but it will be a long haul to change people's behaviour and practices away from what they're used to."
With just eight employees, Underwater Excavation of Porthleven, Aberdeen, has won a Queen's Award for technological achievement. The company developed a propeller with high-pressure water jets fabricated on to the blade tips to rotate it. It operates without any physical contact with the sea bed, and is safe to use on live pipelines and other structures prone to damage. It also performed 400 times faster than the equipment it replaced when working on the Bruce field.
Among the other small winners is Pan Liner Agencies, an international shipping and forwarding agent which provides a door-to-door delivery service, invoicing and documentation, and arranges letters of credit. With 10 employees, it has recently opened new markets in Asia and Africa.
A company which started with five employees and an unpromising connection - it supplied the Midlands steel and coal industries - has won its third Queen's Award.
AES Engineering, of Rotherham, took over a tiny Derby engineering company after it lost the right to distribute an American-made mechanical seal, and went on to patent a new type of seal which compensates for angular misalignment in pumps.
Chris Rea, AES's managing director, said the move had originally been a matter of survival, but the product was a world-beater and won a Queen's Award for technological achievement in 1988.
North America, which was AES's original supplier, is now its biggest market. One of its largest customers is Mobil Shipping, which fitted double mechanical seals on cargo pumps used for unloading crude oil. Fifteen years after being set up, AES has grown from five to 145 people.
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