View from the top: Brompton Bicycle

Going from small to big should come as second nature to Brompton Bicycle. The Brentford-manufacturer has built a thriving £14m business on producing compact packages of metal and rubber that transform into full-sized bikes. Now, says managing director Will Butler-Adams, the company is to extend its engineering ethos into the business market. "I think there's an opportunity for a huge business, one that could be bigger than the global bike manufacturers like Giant and Specialized," he says. "Those manufacturers have managed to create a multi-billion pound market based on bikes for recreational use." Brompton's bike appeal stretches further afield, explains Butler-Adams. "There's been a real renaissance in people using bikes as a mode of transport. We're selling to people who need a bike to get into work and want to keep fit at the same time. The opportunities are massive." The bike's popularity has fuelled 15% year on year growth at Brompton since 2004. The success bought Nick Clegg and Vince Cable to visit Brompton's site in January, acclaiming the firm as an example of the future direction for UK manufacturing. Yet despite the plaudits, Brompton faces a herculean task to achieve its ambition of going from SME to global player. The UK is home to fewer large manufacturers than Germany and the US, according to EEF research, with domestically-owned giants the rarest breed. Many bright flames suffocate beneath lending difficulties, red tape and hostile taxes. However, Brompton can buck the trend, says Butler- Adams. "We're interested in making a good folding bike, but as it happens we've also created a powerful brand," he says. The Brompton allure is particularly strong internationally. Over 70% of business is export based with models carrying a cache as 'the London bike'. Much of the Brompton's popularity has been achieved through word of mouth says Butler-Adams, and there is plenty of scope to develop markets in the EU, Japan and China. International growth can be achieved even if there is a recovery in the strength of the pound, he predicts: "People are not buying us because we're the cheapest. It's about the strength of the product and the fact we do it better than anyone else." Hurdles to expansion are far more likely to come internally, he believes. "There's a speed at which you can grow. We can't throw hundreds of thousands of pounds in and transform into a Toyota overnight. We've got to grow incrementally." Brompton plans to fund target growth of 5-15% per year independently, according to Butler-Adams. Going it alone will be rife with challenges, reflects Butler-Adams. One major difficulty will be the increasing rarity of companies like Brompton across other sectors in UK manufacturing. "We used to get our raw materials in the UK. If we were sourcing aluminium we'd only want a small volume and we were able to piggy back on to another manufacturer's order. Now that other company no longer manufactures in the UK." Brompton has had to turn instead to Taiwan, Russia and the US to source raw materials. The trend could be a fatal flaw in the UK manufacturing renaissance, warns Butler-Adams. It's a point the Brompton boss took up with the business secretary Vince Cable during his site visit. "I was trying to explain to Mr Cable that there's a guy around the corner who supplies injection mould parts. "You would look at those parts and think there's nothing advanced about that. But there's huge intellectual property in the machines that makes that product." And the risk of vanishing IP isn't a problem confined to production techniques, stresses Butler-Adams. The Brompton boss is unequivocal on why the UK lags behind in producing domestic manufacturing giants. "I believe we don't have the best minds coming into engineering. Somebody I look to as an outstanding business leader is Sir John Rose of Rolls-Royce. He is a great mind but never trained as an engineer." The industry is only attracting a very narrow pool of talent, he says. The students with more of an entrepreneurial flair are simply not being switched on to engineering. "We could do so much better if we got those bright minds to see engineering as a career," he says. The turnaround must begin with a major shake-up of our schools, urges the Brompton boss. "The education system serves a ridiculous league table system and that's wrong. Schools are not delivering to employers or pupils. Half of teachers don't have a clue what a modern manufacturer does." When youngsters are given a true flavour of the factory floor they're often inspired, he says. Butler-Adams takes his bikes on tour to local schools to try and pique interest. "It's a shame I turn up on my bike because they probably think manufacturing is not very well paid," he jokes. A government-backed scheme to get students to tour factories could be a starting point for stirring youngsters' aspirations, reflects Butler-Adams. But he cautions against early claims of success. "We'll only know in five or ten years whether it's worked," he says. "Whether you think the initiative is right or wrong, at least they are trying." But Westminster must show long-term commitment to truly harness sustained growth in UK industry, he stresses. "We're not like the service industry where you stimulate things for a year and then clear off." That's why Brompton has a relentless focus on product development and testing: "Companies can get overexcited about their brand and forget about developing their products. It a bit like the emperor's new clothes," he explains. Brompton is currently carrying out rigorous tests on a new electric-powered bike and trialling it with user groups, reveals Butler-Adams. "Detail matters. The closer you want to get to perfection the harder it is. We can all play tennis, but we aren't all good enough to get to Wimbledon." With a renowned brand, innovative engineering and unquenchable ambition, Brompton has all the aces to play on the bigger stage. "In five years' time we should have doubled or trebled turnover," says Butler-Adams."We'll maintain the same growth of 10-15% but against a turnover of £50m we'll be in a position to take on the global players."