From equipment supply to total turn-key solutions, inclusive of design, installation, commissioning and training, Clyde’s systems can be found operating in every part of the developed world.
Written by James Hurley & Produced by Paul Radbourne
Global materials handling solutions provider Clyde Materials Handling Ltd was founded in 1974 and began supplying pneumatic conveying equipment to the foundry, coal power and steel industries. Much of that early pioneering technology is still in use throughout the world in industries as diverse as steel, minerals, foods and pharmaceuticals.
Clyde Materials Handling is an operating subsidiary of Clyde Process Solutions plc, an AIM-listed company that has recently released an impressive set of preliminary results for the year ended February 28 2007; the company announced a 20.5 percent increase in global revenues to £17.3 million. The foundation for this impressive growth has been driven by the strong performance of Clyde Materials Handling.
Dual growth strategy
During the 1980s and 90s, Clyde Materials Handling acquired a number of world-leading brands, some dating back to 1897, and in the process significantly increased its knowledge and skill base, helping it to secure its position as one of the world's leading pneumatic conveying specialists, one of the most common methods of moving solids in process industries. Pneumatic conveying refers to the moving of solids suspended in, or forced by, a gas stream through horizontal and/or vertical pipes. It can be used for particles ranging from fine powders to pellets.
By leveraging the advantages and combined knowledge gained through its acquisitions, Clyde has created pioneering solutions that have the capability to pneumatically convey or inject materials used within modern production processes for the iron & steel, non-ferrous metals, gypsum and cement markets.
Richard Sims, Managing Director of Clyde Materials Handling, says he sees the group growing organically in two ways. “We have a two-pronged organic growth strategy moving forward. Firstly, we believe that our key customers markets will continue to present our existing subsidiaries with opportunities to grow both revenue and market share. There are also territories such as Russia and Australia that are intuitively seeking out suppliers that can add value and benefit within the field of materials handling across process industries. We will be exploring the option of growing our global footprint in the coming year.”
In July 2006, Clyde Materials Handling reversed into a shell company on the Alternative Investment Market (AIM) of the London Stock Exchange. This created a business called Clyde Process Solutions, which Clyde Materials Handling is now an operating subsidiary.
Commenting on this development, Sims says, “The decision to effectively float the business on the stock market was taken for a number of reasons. We were eager to increase the profile and exposure of our business, as well as providing our employees with the opportunity to invest in their company. We also viewed AIM as channel to raise equity that would support acquisition assisted growth.”
Nine months after its successful flotation onto AIM, Clyde Process Solutions completed the acquisition of MAC Equipment, Inc for £43 million.
Commenting on the acquisition, Sims says, “MAC is an established provider of pneumatic conveying and air filtration solutions that we believe will not only add substantial benefit to our key customer markets but will also be a significant contributor to the enlarged group’s growth. Furthermore, we believe that there are opportunities to strengthen the global footprint of Clyde Process Solutions by introducing both MAC and Clyde Materials Handling solutions to their respective territories, customers and markets.”
He continues, “Whilst organic growth remains an integral element of our strategy, we will also continue to explore the possibility of adding other technologies into our portfolio by way of acquisition. Our AIM listing will continue to support this thread of our strategy.”
Market-driven strategies
Clyde Materials Handling has been securing contracts with some of the world’s leading operators across its key markets. When asked how this has been achieved, Richard Sims is certain that the ability to deliver a high quality, standardized global product is where the company has gained an advantage. “We’ve been doing a lot of things differently to other people on our business,” he says.
“We’re a global company, with outstanding products and process expertise. Our corporate head office might be based in the UK but everything that we do is geared towards serving our customers, who operate in the global marketplace. In the last four years we have opened up daughter operations in China and Brazil and we also have an operation in the USA that’s been going for fifteen years that’s only become a manufacturing operation in the last three or four years.
The UK remains the global knowledge centre but we’re now able to deliver a standardised global product on a localised basis. We also have associated joint venture companies in South Africa and India, so nearly all of the continents are covered in one way or another.”
Sims has been in materials handling all his working life, but says that his ‘proper career’ only began when he joined Clyde in 1988 and began to move away from a strictly engineering role and into sales. “To be perfectly honest, the detailed bit of the engineering side bored me a little. I was more interested in new ideas, innovations and the big picture. I was quite happy to pass the detail onto other people, so the move into sales was better for me. But having the detailed mechanical engineering background, I don’t feel out of my depth talking about technical issues, because that’s my foundation.”
The UK operations can be classed as a parent for the company’s worldwide operations. “We drive the global corporate strategy from Doncaster. Even at the sales stage we have global market managers that work for the UK operation but also drive the global operations for their particular industries. For example, the non-ferrous metals or iron and steel industries are very prominent in places like China and Brazil. Our UK market managers are helping the Chinese operations in their territories, so the knowledge transfer starts all the way from the front end sales market manager positions all the way through the company.
“As the daughter operations grow,” he continues “we’re putting more and more capability into those operations. They may have started as sales offices but we’ve gradually put more capability in, so they now have proposal engineers, project engineering capabilities and their own manufacturing facilities.”
A talent for innovation
While Clyde is a manufacturer, in terms of operations, the manufacturing side of the business is not particularly large, with the focus instead placed on engineering. “What we do is get a lot of our equipment sub-contract manufactured. Our manufacturing capability tends to be an assembly shop - we’re assembling parts manufactured elsewhere into a finished article. The skilled manufacturing aspect is relatively small. The skill is really in our engineering capabilities, the office rather than shop floor. That’s where we spend the majority of our focus in getting the right people,” says Sims.
As in many sectors, finding skilled staff can be challenging, a challenge that’s more pronounced in Clyde’s case due to the precise skills set that the company requires. “Instead of having a product and going out and selling, we try and understand our customers’ needs - what’s causing them pain in their operations, what’s causing waste, what’s losing them money - and then try and create a solution that will overcome their problems. That requires a different mindset to that found in a common or garden salesman,” explains Sims.
“It filters all the way through our engineering, design, and product and development areas. It’s a solutions selling, problem solving mindset, and there aren’t many people wired up that way. Finding innovative problem solvers is consistently challenging.”
A challenge it may be, but its one that the company is succeeding in meeting. The company’s market driven, customer focused solutions are credited with underpinning the group’s strong organic growth, whilst its AIM listing continues to build the group’s profile and provide it with an avenue to grow through acquisition.
This innovative approach has been recognised with a nomination for the North East regional final of the National Business Awards, sponsored by Orange where the company has been shortlisted for the Badenoch & Clark Business of the Year award. Clyde Materials Handling will learn if they have secured this accolade at a ceremony in Manchester in July.