What’s your asset investment strategy? Considered or bold?
To some, the investment we’ve made in new aluminium fabrication equipment over recent months will appear to be a bold move carrying a large element of risk, but I don’t agree with that viewpoint. Obviously, as MD of the business, I know the facts and I’d describe our move as “considered”. Believe me, there was nothing rash about the decision.
Yes, we’re primarily a fabricator of PVC-U windows and doors. Yes, Brexit is a concern. Yes, the construction market fluctuates, but there are always issues like this, and I don’t believe they should prevent a business making sound decisions about its future direction or taking steps towards its goals.
The alternative to investing in your business development is to sit on your hands and do nothing, to wait for the mythical “right time”. While you’re waiting, your existing plant and machinery creaks and groans, your team’s skills wane and become outdated and your customers start to look elsewhere for the products, service and prices they need. To me, sitting still is far riskier than venturing forth.
My answer to any questions was straightforward. I know that in the domestic glazing market, aluminium is growing in popularity. I know those who choose aluminium, aren’t as cost driven as some consumers and are less likely to be influenced by any Brexit related woes, and I know that when we invest, we’re looking at the long-term picture, not the next year or two.
There may be some readers in cash-strapped businesses thinking that it would be good to be in a position where investing in new plant was a possibility. To them, I would say that instead of focusing on the headline price of a new machine, they should take the time to understand the whole picture.
For example, what is the existing machinery costing in terms of maintenance or spares? What is its output capacity? What is its power consumption? How many man-hours does it take to run the machine? Does it have a resale value? Could it be repurposed?
When you start to look at an asset and its costs in this way, it’s often the case that investing in new equipment starts to make a lot more sense. And there are ways of acquiring an asset other than outright purchase. Could you rent or lease? Is there any funding available? Could you share the asset with another business? Going back to other people’s gloom about the uncertain economy, if other investors are being ultra-cautious, you may even find you can secure a very advantageous deal.
I’m not one of those who goes around wearing rose-tinted glasses, but I do believe that confidence breeds confidence. When you have a positive outlook, it filters through an entire team and boosts performance. Every decision is easier and progress is faster. Your operation stays competitive and your production infrastructure is in place to support your vision. Providing you know your stuff, confidence is a position of strength, not weakness.
As a business, we’re taking great strides forward with aluminium because we’ve had the confidence to invest – in machinery, in skills, in expertise and in training. We’ve considered all aspects, understood the risks and the rewards, and then we’ve taken that bold step and gone for it.
Find out more about our investment here