Member Article

Leeds envelope manufacturer invests £500k in new machinery for growth after MBO

Morley-based printed envelope supplier GNE has invested £500k in new plant and machinery over the last 12 months that has the potential to grow turnover from £18 million to over £20 million.

Originally part of the Adare Group, the company was acquired by its current management team following a management buyout supported by Yorkshire Fund Managers in 2005.

Now wholly owned after a secondary MBO in 2011, the firm is run by managing director Warren Shermer who believes there is scope within the business to grow turnover by a further £3 million:

He said: “The market for direct and transactional mail has stabilised and although it is still fiercely competitive, there is capacity within the business to consolidate our market share and grow the company further.”

“It used to be the case that demand in our industry broadly followed trends in GDP but the emergence of internet banking and utilities from 2000 onwards saw a decline in mail volumes, which some commentators saw as terminal.”

“At the end of the day, we all have pretty much the same machinery. What makes the difference is our flexibility and our people – having a ‘can do’ culture and building relationships with our customers.”

“Online also tends to be seen as carbon neutral but that’s not the case. Email marketing is now also far more intrusive – and therefore less effective – than traditional direct mail.”

“Growth is going to come from investment in infrastructure so that we can run more machines more often but we have to be a service company as well as a manufacturer.”

The firm’s key customers are in the financial services sector, charities and mail order. Like the rest of the industry GNE faced difficult times when the recession hit in 2008 and the UK market place shrank by 12%, compounding the effects of the widening ‘technology gap’ as client and consumers moved towards online banking.

GNE currently employs a workforce of 136, operating from its 78,000 sq ft plant in Morley, with the operation running 24 hours a day, six and a half days a week.

This was posted in Bdaily's Members' News section by Clare Burnett .