A Scottish iron foundry is beating off competition from multi-billion pound plants in China and India to resurrect the industry in Falkirk District, once a world centre for iron production.Specialised Castings Ltd, the last traditional iron foundry in Falkirk District, has secured the jobs of 26 staff and plans to recruit more following financial backing from the not-for-profit, ethical lender DSL Business Finance.
The foundry originally rose from the ashes of the iron works in Foundry Loan Larbert, when owners Falcon Catering (Glynwed) decided to close in 2001 as work shifted first to England and then to the massive new factories which were being built in China and India.
Then Foundry Manager, Steve Waring (61) decided to take over the business, re-locating it, and the equipment, to a derelict paper mill on the banks of the river Carron in Denny.
Sixteen of the highly skilled foundry workers came with him, including 76 year old Charlie Finlay who started in the industry as a 14 year old and continues to work in the foundry today making complex moulds for high integrity castings.
Ten years on Specialised Castings Ltd now provides complete foundry services from pattern making to casting through to finishing processes to a diverse customer base including engineering, oil and gas, catering, architectural and restoration sectors.
The business, which can trace its history back to one of the earliest foundries in Scotland – the Falkirk Iron Works which was formed in 1819 by workers from Carron Iron Works, continues to go from strength to strength with an average annual turnover of around £1.5 million per annum.
In 2005 Ian Walker, formerly of Taylor Group Foundries Larbert, joined the company as Foundry Manager, with James Smith, Metallurgist and John Leslie, Sales Manager completing the Management team in 2008
Recent commissions include large pipes and castings used in fire fighting, pumps for North Sea oil platforms and decorative works such as a replacement fountain canopy for Lesmahagow, over 100 metres of main guttering for Paisley Cathedral and restoration of the iron works in the ancient Valley Cemetery in Stirling’s old town next to the castle.
Specialised Castings is also believed to be the sole supplier of cast iron Royal Mail small lampletter boxes. It also sells beautiful reproduction products such as ornate clothes poles, fire place backs and garden bench ends direct to the public through its website www.thecastironcuriosityshop.co.uk
In order to develop the business, Steve turned to DSL Business Finance for £30,000 of backing earlier this year after banks reduced small business lending due to the financial downturn.
Glasgow-based DSL runs a £1.5 million loan fund to help small and start-up businesses create jobs and investment, especially in disadvantaged areas.
Under the Government scheme, the Enterprise Finance Guarantee, DSL can provide micro-finance of up to £30,000 to small firms even if they have been turned down by the banks.
82% of DSL clients believed DSL to be their only available source of business finance as small businesses continue to struggle to raise bank cash due to the economic downturn.
Steve, whose wife Nanette also works at the firm, said: “When I decided to take over the foundry every one said I was mad as manufacturing was a thing of the past and I’d never be able to compete with the huge new, high volume, industry in developing counties such as China, India and Taiwan.
“But this just didn’t seem right to me. I’ve worked in the foundry industry all my life so knew there was a market to supply specialised products to people who can’t get what they want from high volume at low prices from abroad.
“I wanted to keep the foundry industry alive and retain jobs for skilled foundry men and bring young people back into the industry. I now employ 4 young people including an apprentice Pattern Maker thanks to the support of Falkirk District Council’s Training Unit.
“The success of Specialised Castings is due to having a broad customer base and a committed hard working team of foundrymen, who take a pride in our products. One day we can be producing huge compressor castings for power generation and mining companies the next we’ll be making tiny decorative badges for a pipe band or door catches for the Austin A30. I’m not over dependent on one sector like some of the foundries were in the past.
“However, this is a very capital intensive business. The price of metal has shot up in recent years, and even though I recycle scrap. the cost of buying materials is exorbitant. The furnaces used to melt the metal down use a lot of electricity and the power companies are much more dififficult to deal with nowadays”
Commenting on his support from DSL Steve, a Yorkshireman now living in Dunblane, added: “I don’t think we would be here if DSL hadn’t backed us. As a result of their support other lenders were willing to back us. The banks just didn’t understand the foundry industry. They just assume that it’s a dead industry in Scotland and can’t believe that someone could make a success of it.
“Now I’m having to recruit more people to keep up with my order book and things are really buoyant!”
Eunice Lancaster, General Manager of the social enterprise DSL Business Finance added: “DSL has always supported manufacturing companies which we believe are very important for the economy.
“Many manufacturing companies find it hard to start-up and grow primarily because costs of equipment, machinery and raw materials can be very high. For this reason they can also struggle to raise cash from traditional lenders such as the banks, who don’t really understand the industry. This has become even more difficult since the credit crunch began and bank finance is much harder to find.
“DSL has social as well as financial objectives. We provide cash to small businesses that can’t get money from the banks, in order to help them to set-up, grow and create jobs and investment, especially in disadvantaged communities. Any profit we make is pumped back into providing loans for small businesses.
“I like to think that we have an ethical and prudent approach to lending. We still operate to high financial standards and have a rigorous loan application process, but we also try to get to know the person and their business needs. Clients appear before a “dragons den” style panel of experts to get their loan application approved but they also get guidance on business planning, accounts, sales and marketing.”
Since setting up in 1983 DSL has helped more than 600 businesses create 2,000 jobs by providing more than £7 million in loans.
If you think DSL could help your business please contact them on Tel: 0141 425 2930 or go to http://www.dsl-businessfinance.co.uk/.
For further information on Specialised Castings go to www.specialisedcastings.co.uk or Tel: 01324 820077