Sheffield Forgemasters is aiming to earn as much as 20 per cent of its income from outside manufacturing, rejecting marginal business and investing to stay at the forefront of its sector as the world’s economies recover.
Speaking at the annual dinner of the British Manufacturing Plant Constructors’ Association in the Cutlers’ Hall, Forgemasters’ chief executive, Professor Graham Honeyman said that five years ago, all of the company’s income had come from manufacturing.
Nowadays, however, manufacturing accounted for 90 per cent of turnover and, in future, that would reduce to 80 per cent.
“That is not to say we are reducing manufacturing. We are expanding other areas of the business for the future, said Prof Honeyman.
Prof Honeyman revealed that the Brightside Lane company had recently lost an order to Korea because it wasn’t willing to take the risk involved in trying to undercut the competition.
“Sometimes it is good not to engage with competitors. We have to be strong under these circumstances,” said Prof Honeyman.
“We are still putting money into the workforce and research and development because when we are out of recession we will be right at the forefront, world wide, and I hope your companies will do the same,” Prof Honeyman told Association members.
Prof Honeyman was speaking shortly after Forgemasters revealed it was launching two new subsidiaries of its research and development operations.
RD26 – RD for Research and Development and 26, because the main element in steel is iron, which is number 26 on the Periodic Table – is the name of the new Forgemasters business, which encompasses its R&D and testing operations.
Forgemasters has also launched a subsidiary of RD26, called RD Testing, covering its laboratory operations.