Case Study: Labfacilities Ltd
Published: August 2005
Originally launched as a one-man business operating from the home of the founder, Labfacility Ltd is now the UK’s largest manufacturer of temperature sensors. Major UK blue-chip clients include BAE, Eurotherm, GlaxoSmithKline, H J Heinz, Honeywell Control Systems, ICI, Jaguar Cars, Lucas Aerospace, various MOD, Research and University establishments.
Labfacility products are also featured in the worldwide catalogues of electrical distributors Farnell Electronics, Omega and RS Components, and exported to more than 85 countries.
Originally based at Bognor Regis, West Sussex, Labfacility needed to expand into the North of England in order to widen its UK operating and trading base. Managing Director, Martin Riddett said the company needed to overcome a North-South divide in its operations network by establishing a Northern base.
He said: "Although successful and growing, we were too focused in the South of England and needed to redress the balance by establishing a Northern base and expanding further from there."Martin, whose father Jim started the business in 1971 and is now Chairman, eventually solved the problem in 1989, by buying a three-man company based at Dinnington, Sheffield, from which the company has continued to expand.
In addition to finding suitable premises, Labfacility also needed to raise the finance necessary to support its continued expansion. Martin’s first dealings with South Yorkshire Investment Fund led to the advance of a £30,000 unsecured loan that allowed him to buy out a major shareholder and expand the business further, including the introduction of new products.
The loan helped Labfacility to secure its Sheffield operations, improve the job security of its staff and widen its range of products and services as part of its continued growth.
Since then SYIF has provided a further loan of £20,000 and most recently £125,000 that has helped to finance the company’s continued development. The most recent loan formed part of a £445,000 funding package that has enabled Labfacility to move into new premises at Dinnington which is no the company’s largest site in the UK
Progress to Date
Labfacility moved to the new 7,500 sq ft premises in June 2005. The newly built unit at the former Dinnington Colliery site provides more operating space and significant room for growth. It also enabled the company to provide a much needed staff canteen and a large meeting and training room.
To coincide with the move, Labfacility introduced 63 new product lines to its second largest customer web based catalogue Farnell InOne based in Leeds and was expecting to create new jobs in production, stores and sales to accommodate future growth plans.
Said Martin Riddett:"We found the service provided by SYIF to be very effective with the minimum of red tape. Our contact, Investment Manager Allan Wood, has worked with Labfacility now for over four years and during that time has overseen our growth from 19 staff to the current 28. We are very pleased and proud to be one of the developing companies within Dinnington who are contributing to its continual improvement and success.
"Without the assistance of SYIF, Labfacility would have found it tremendously difficult to have achieved the funding required for this project in the time frame required and we are eternally grateful for their help!"
Latest Case Studies
About South Yorkshire Investment Fund
South Yorkshire Investment Fund provided seedcorn, loan and equity linked investments, ranging from £15k to £2.5m, specifically to help small and medium businesses meet the gaps in funding they need for growth and development.
Created as part of the Objective 1 programme, the Fund is a private and public sector business finance provider. The European Regional Development Fund and Yorkshire Forward are investors in the Fund.
South Yorkshire Investment Fund also provided access to Business Angel investments from the Yorkshire Association of Business Angels and Microloans through BiG Business Loan Fund and Donbac Microloan Fund.
Finance Yorkshire has now taken on responsibility for providing gap finance in Yorkshire and the Humber.
For further details please contact Suzanne Tinkler, on 0845 649 0000.
South Yorkshire Investment Fund Ltd is a company limited by guarantee (Registered No 3936065). South Yorkshire Investment Fund comprises three sub funds, the South Yorkshire Investment Capital Fund, the South Yorkshire Investment Development Fund, which are each managed by YFM Venture Finance Limited, and the South Yorkshire Investment Small Business Fund, which is managed by Finance South Yorkshire Ltd. YFM Venture Finance Limited (Tel 0113 294 5000) and Finance South Yorkshire Ltd (Tel 01709 386 377) are each authorised and regulated by the Financial Services Authority. South Yorkshire Investment Fund also provides a number of services, which are not regulated by The Financial Services Authority. These include the pilot Seedcorn Fund, BiG Business Loan Fund, Mentorbank and access to the Donbac Microloan Fund. BiG Business Loan Fund is managed by Donbac Ltd (company registration No. 01925556) and Key Fund Yorkshire Ltd (Tel 0114 242 8900).