Tough times test businesses. The RP Group is one of those that was tested by the recession, but is emerging stronger and more resilient.
“We were growing steadily until October 2008 and then somebody turned the tap off,” explains managing director Steven Allen. “It happened on the 1st October. Trade dropped in October and plummeted in November and December – though we still ended the year as our best year ever. Our sales dropped 45% in the next year. It was absolutely massive.”
Allen recalls: “We cut our costs as much as we could. The hardest decision I ever made was to tell people you don’t have a job. But people were incredibly good about it. We have a fantastic team of people here. They understood the problems we had at the end of 2008 and they have worked with us.”
In all, RP Group made seven staff redundant. For a family firm – the company was started 44 years ago by Allen’s father and a business partner – that has inspired tremendous employee loyalty, this was difficult. Even now, many of the staff are very long serving – some have been there for over a quarter of a century and collectively the 34 staff have clocked-up almost 400 years of employment.
The RP Group –also known as Rubber & Plastics – is based in Belfast’s Duncrue Industial Estate and is a primary manufacturer of hose assemblies and a distributor of engineering products. Its client base includes some of Northern Ireland’s leading manufacturers, including FG Wilson, Terex, McCloskey International, DuPont, Seagate and Bombardier. Allen explains: “We supply a range of products used in the actual product they manufacture, or which are used in the production process, for example by Seagate.”
But it was quickly clear when recession struck that the RP Group had to do more than cost control if it was to survive and then to grow once more. “We decided to start rolling-out some initiatives to get new business,” Allen continues. “We installed a new CRM – customer relations management – system, with help from Invest NI, to capture data better, to help our customers and also for us to find new businesses we could sell to.
“And we helped customers, for example, by selling in smaller quantities. We also set-up an eBay shop, initially to get rid of excess stock. It is still a small business for us, though we are now a top rated supplied on eBay and have added more non-core products.
“Over the years, our supplier base had broadened out. Back in the beginning suppliers would have almost all been from the UK or Sweden, but now 20% to 25% of our products are sourced from Chinese suppliers. And we visit all of them on a regular basis. We spend a fair amount of time and money to maintain relationships with China and we have participated in a number of trade missions with Invest NI.
“As well as developing relationships with existing customers and new, more distant, suppliers, we aggressively sought to export more of our products, particularly to emerging and growing economies.”
A major emphasis of the new export focus has utilised the company’s long standing strong connections with existing customers’ to access these customers’ wider international operations. “For example, FG Wilson is part of the Caterpillar group and we now supply their factories in the United States, China and Brazil and also their logistical partners in the USA and elsewhere,” says Allen. “We supply to Seagate in Singapore and Terex in India on the back of supplying Seagate and Terex here.
“We looked at ways to broaden our business, rather than just battening down the hatches and hoping the bad times would go away. We did have a bad 2009, but turnover has since grown significantly. By 2010, we started to pull things back. But we still finished the year down 20% on 2008. This year, 2011, has started off really well and, although rising costs are always a concern, we are forecasting that turnover will be pretty much back to our best year of 2008. So it has taken us two years to put things back on track and we are determined that it won’t stop there.”