Bromsgrove firm enjoys record profits after diversifying

A WORCESTERSHIRE engineering firm has announced record profits for the first nine months of its financial year.

SIFCO Applied Surface Concepts (UK) Ltd, a selective metal plating company based in Bromsgrove, has also achieved higher profits than in any previous full year.

The company has experienced a 27% sales increase so far this year, in addition to July 2011 being a record sales month for the company.

The growth, which flies in the face of current manufacturing gloom, is a result of diversification into new sectors and investment into new technology.

Mark Smith, managing director, said the improvement in both sales and profits was down to the company’s planning last year while sales were flat due to the recession.

“Efficiency changes and proactive marketing were put in place in early 2010 to arrest the fall in sales and profits,” he said.

“From this, new Key Performance Indicators were introduced for the staff to monitor internal efficiencies and to find where improvements in work practices could be found.”

The company targeted specific industries in which it has performed the strongest, leveraging knowledge and application skills to win more business. It also looked at potential new business, which was a slight diversification from its traditional selective plating work.

Mr Smith said that in order to win a contract with a local company to etch turbine components, SIFCO had had to invest more than £80,000 in new equipment – even though this was a risk in the current climate.

“We believed as a company that if we were to win new business, we had to show our commitment to our customers by being innovative in our business practices. This meant not sticking with our traditional work, but by also looking for complimentary surface finishing projects,” added Mr Smith.

The installation of a new chemical etching line was completed and initial trials were held successfully to prove the process on the clients’ products.

“The team worked hard to ensure that when we were ready to work on the customers’ components, that all the process parameters were correct and that we liaised with the customer fully throughout the project,” said Mr Smith.

“Successful implementation now means that SIFCO etch most of their clients’ components.”

SIFCO is now targeting further growth by looking for other companies requiring a ferric-chloride chemical etch for their components.

Mr Smith said: “Our advantage is that we do not need large volume runs to work efficiently on our line. Companies who require up to 100 parts per month could well find that we are more competitive than the traditional chemical etching companies who require large volumes to ensure their line run efficiently.”