Full steam ahead

Full steam ahead Townsend Coates thinks big….it plans to have doubled in size in less than three years as the electromechanical components market fills the company’s sails. Mick Elliott visited the firm’s HQ
You need a decent sense of direction to arrive at Townsend Coates. The road signs slavishly followed from the motorway suddenly disappear in Leicester city centre. The only option is to take a punt… and it worked.
Running a company is not much different. A direction is definitely required, and the knack is not to wander off the strategic road map.
Townsend Coates has never wavered. It has stuck to its focus on electromechanical and passive components and prospered.
Now staying within the confines of its product portfolio, the company is planning to accelerate its growth.
“The company has grown consistently over the last few years,” says managing director Alan Cook. The growth slowed last year along with the market-place.
This unwelcome lull at least gave Cook and his management team time to hammer out a strategy for the business. “We want to double the size of the company in less than three years,” says Cook.
The market conditions fuel his expectations. The semiconductor and passive component markets have ground to a halt but Cook sees real potential in Townsend Coates core electromechanical components market.
He cites AFDEC’s latest figures showing a 7.3 per cent increase in the UK market, pointing out that distributors enjoy 31 per cent of the total available market for e-mech parts.
It is also the case that suppliers are referring more business to their distribution network. “They are chasing the distributor to grow their business and create demand,” observes marketing manager Steve Horn.
Passive components which are set to grow marginally at 0.4 per cent will not be ignored. Townsend Coates holds a Vishay franchise, but Cook concedes that passives are a small percentage of the overall business.
The plan taken to Townsend Coates parent company – Sedgemoor plc, the group formerly known as MLHoldings – includes some ambitious targets.
At the core is a plan to develop five key franchises worth ?1m plus in revenues in addition to Amphenol, where Townsend Coates has consistently been number one in that company’s core military and aerospace market.
Of the five most likely to hit a million four are already within the group. Cook starts with Honeywell.
“An excellent range of microswitches and a line with great potential.”
Next is the connector juggernaut Thomas &Betts which now also includes the Augat product line acquired last year.
Cook sets great store in its latest connector signing, the French supplier FCI. “We have signed an established connector manufacturer with great growth potential, which has got the lot in products,” he says.
Cook sees Townsend Coates concentrating initially on a selected range of devices which it will take to the industrial market.
The ITWGroup which also includes the Panduit range is another double whammy combination Cook will look to take past the ?1m market.
The next one? Cook concedes that it is difficult to see where the next one will come from, especially as it has to be non-competitive. But he is confident it can be found.
A million pounds is an awful lot of sales and the answer to where some of it will come from can be found in an expansion to Townsend Coates sales and marketing team.
Horn, a relatively recent recruit from ES Electronic Services, will head up a market development team. “Two market development engineers have been appointed with special skills and experience,” he explains. “Their mission is to increase sales, however they will not be restricted by territories.”
Each will have specific end market targets focusing on EDP, telecoms, contract manufacturers, cable assemblers, and industrial and process control.
Horn has also put more focus on major customers. Two key account managers have been added and they will concentrate on a top 10 to 20 accounts.
The field sales engineering team will have two targets. To grow the non-Amphenol franchises and the non-strategic Amphenol Accounts.
Internal sales gets a boost too with the addition of two more personnel. These new recruits and existing sales personnel will benefit from another major investment.
“We have installed a network which enables all our sales people to access the sales and marketing database remotely,” explains Cook.
It means the database is instantly updated with the latest information on customers needs, logs technical enquiries and enables e-mail communications.
A Web site has also been launched with separate pages for different product categories and hyperlinks to suppliers web sites. EDI links have also been forged with suppliers.
The services theme is being bulked up in other ways. Connector assembly is still mostly based around the Amphenol product line and Cook reckons to offer a turnround service of one week in some cases.
It is an area which could develop.
Brian Coates, business manager at Townsend Coates concentrates much if his time on the Amphenol line.
“The role is to maintain our presence in the large military and aerospace customers, but also look at ways the military style connector can be used in non-military applications,” says Coates.”We aim to be the prime source of supply of Amphenol products in those markets.”
Cable assembly is also on the menu card and the question is whether to contract out the service or make a small acquisition. “There are a number of such companies in the immediate locality,” says Cook.
The new business strategy, dubbed TC2000 has been founded on research. Technology, systems and logistics are all being upgraded.
The more obvious immediate change is the company’s new logo. The emphasis on some of the heavy hitting suppliers means Townsend Coates will review its line card, possibly disengaging from one or two of the smaller suppliers. “The focus will be on our key markets as we go for growth,” says Cook.


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