Proudly Welsh furniture brand Masterclass Kitchens has grown to become a key player in the UK market – particularly with a tight group of independent retailers – and now with a massive investment in a new factory and supporting infrastructure, it is set to grow even further. Andrew Davies went to Cardiff to find out more…
To get to the Masterclass HQ on the outskirts of Cardiff, you have to pass The Royal Mint, a pretty nondescript building that belies the fact that inside they really do have a licence to print money.
While it’s a pretty clumsy comparison, there’s no denying that the ongoing success and growth of Masterclass just a few minutes away is incredibly impressive by anyone’s measure and with the recent announcement of a huge £20m investment in new facilities, it’s clear that while that licence may not literally exist for the Welsh brand and parent company Sigma 3 Kitchens, there is significant business being done here with more to come.
The growth is well planned, as you would imagine, starting with a major project to increase the capacity and efficiency of the existing Llantrisant plant, followed by the opening of a new 130,000sq ft facility 13 miles away in Bridgend.
Simply put, Masterclass is about to triple in size.
So while business may be booming now for the whole sector in the wake of covid lockdowns there is still some uncertainty about what happens next – so why such a big commitment at this time?
“It’s actually been a long process and one that started nearly eight years ago,” explains managing director Gerald Jones. “We took the conscious decision to start manufacturing products that historically we would have purchased from elsewhere. We were finding that the industry was becoming significantly commoditised, and we were constantly battling price and there was very little grounds
for differentiation.
“So we decided that to really develop Masterclass as a brand, it had to be far more than just the design of the door because most consumers don’t really understand the difference between one door and another. It had to be about everything behind the door too.
“However, while that’s enabled us to grow as a business, we’ve been constrained through the space and facilities that we’ve got as the production demand increased exponentially because of the new products we’re developing all the time.”
This is, of course, a great story of British manufacturing confidence. Not only is Masterclass looking to directly compete with European brands, it’s also thinking it can do something better and more interesting.
“And also to do it with a British twist,” adds commercial sales director Steve Tough. “A lot of continental manufacturers want you to do things their way and they develop products for the whole of Europe. You can’t knock that, but we’re developing products which are specifically aimed at the UK market today. We’re not trying to adapt a product, we bring things out to suit the British customer.
“We don’t want something that looks like a German kitchen. And that’s why the internals and the cabinet construction have been so important to us, that’s the real difference. People talk about German innovation but I would challenge that and ask ‘what have they actually done over the last ten years?’ They’re very good and very consistent and you know what you’re going to get. But if you look at what they’ve actually done to move their products on in that time it’s actually very little. But if you look at what we’ve done inside our cabinets, that’s where we have really turned things upside down through continued innovation.
For Sigma 3 founder and CEO Brian Lakin, this huge investment is another step in a long journey that has seen his family business grow to the point where it can be seen as a major player in the sector.
And, for him, the ‘family’ part is the key to the continuing growth.
“A lot of SMEs do struggle to make the next step up and there can be lots of reasons – a parting of the ways, somebody else takes over, or it gets consumed by another business,“ he says.
“But that’s never been of interest to me and I think that’s down to the long tradition of farming that the families of both my wife and I have. There’s always the idea that it gets passed to the next generation and I’ve said for many years that this isn’t about me now. This is about the whole team and everyone else that is involved. Any success is earned and enjoyed by everybody.”
And, as a proud Welshman, he also wants to see this kind of investment in manufacturing to stay local and hopes there will be help to do so. “It has been a frustration for indigenous business that substantial support has been provided for inward investment into Wales, perhaps at the expense of local opportunities.’’ he says. “However, I do think the right people are starting to recognise these frustrations and the local authorities have been extremely welcoming and making all the right noises.
“We have purchased the new factory ourselves, as it was important that we acted quickly. We have continued our engagement with Welsh Government throughout the process and we hope they will be forthcoming to help speed up our expansion plans.”
“We’re confident that we can expand the business and will grow organically to develop the new facility, but it could take five to seven years. It could take three years if there was more support. If people came in and said ‘we really want to encourage job creation and at a faster pace’ then yes, we’re open to that suggestion. But we felt we needed to control our own destiny. There is a heritage there though, we’re very proud to be a Welsh business.”
Most businesses want to grow and expand their horizons in the way that Sigma 3 and Masterclass has detailed, but expansion can often bring challenges too. Not least of which could be the loss of the personal touch and service quality as the customer base expands.
For commercial sales director Steve Tough, however, that’s not necessarily an issue as, he says, sales expansion will come from existing dealers, not more dealers.
“We’re being very careful for that very reason,” he says. “This is not about having a brand that’s available through 400 – 500 retailers, that’s not where Masterclass sits. I think there’s a huge opportunity to grow business with existing retailers by strengthening the partnerships we already have. We’ve got current customers that may think they’re at capacity, but with the knowledge and expertise that we have we can help some of these businesses scale up.
“It’s about doing what we’re good at – which is manufacturing excellent quality product. Retailers are there because they’re very good at what they do in the local area.
“We’ve got to look at what skills we’ve got to help them upscale their business to another level. Yes. I’d like to go up to 200+ retailers, and I think then we’ll have proper national coverage, but our growth is about helping those 200 to develop to another level.”
All this investment is about building capacity for growth in the future, but given the experience of the last two years of lockdowns, is it possible to plan ahead in any reasonably confident way?
“The covid experience just reconfirms that you never know what’s around the corner,” Lakin says. “But it has shown that having a ‘yes we can’ attitude to everything really works. So we’re at a stage now where we can be confident because I think we’ve strengthened the business. We have four sales arms – our own retail and Masterclass are the two jewels in the crown but we also have contract and trade sides, and they’ve been pretty consistent. So short of the building or housing market stopping then yes, we’re confident. Am I in the business of saying ‘here is The Five-Year Plan’ No. Have I done The Five-Year Plan? Well, let’s just say we plan flexibly.”
Lakin winks as he says this, but he is very candid about how a big part of his job is predicting unpredictability – something business leaders with much less experience than him have been forced to understand recently.
“You have to,” he says. “Plan for the unexpected.”