MERCHANT FOCUS: WILLIAMS & Co
WILLIAMS’ NORTHERN MBI
out of its Hampshire heartland in order to continue to grow its business.
R
ay Stafford sits back in his chair and announces that what he really wants to do in 2018 is get back to selling toilets. And talking less about IT.
The managing director of Hampshire-based plumbers merchant Williams & Co says that 2017 was the ‘year of IT’ when the company changed its 30 year-old system, upgrading it to Kerridge K8. “I spent most of last year talking about IT, in meeting after meeting. That’s not a problem, that’s how it should be when you undergo a major change like that. But at some point you have to say – enough, that you don’t want any more diarised, weekly meetings about it. After every board meeting I write to all the staff to update them on what was discussed and where we are going. The letter that is going out next will be the first one in about six or seven where I haven’t been mentioning the IT system. Yes, there will obviously still need to be conversations about the new system but they probably won’t need to be regular diary items and they will be dealt with by a dedicated team, outside of “business as usual”. It means the rest of us can get back to selling more toilets.”
The new IT system isn’t the only change that the £73m turnover company has been through in the past few years. When Stafford and just over half the staff went through an MBO, buying the majority shares from retiring founder – though still on the board – Mick Williams – they had already identified the fact that they were outgrowing their existing head office, that the IT system was 30years old and that the in-house distribution fleet of 7.5 tonnes vehicles wasn’t really doing the job as well as it needed to.
“While there has been the odd additional branch here and there, in reality, the last few years have been about creating capacity for another scale change in the business,” he says. “We have strengthened the management team; in particular, bringing in people from outside the industry. We moved premises to a
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larger head offices and warehousing space and we re-thought our distribution. Whilst we do our own last mile delivery – we use a specialist haulage contractor from the distribution centre here to the branches. Independent businesses like ours go two ways – they can run all their own vans and lorries and rely on the supply chain to manage the distribution or they can concentrate their efforts on other areas and get in a specialist to cover that side of things. That’s the route we have gone down.“ Running haulage via a third party gives Williams flexibility that they wouldn’t
otherwise have, Stafford says. “If I need extra warehousing I can get it. Extra pallet space wouldn’t be too hard to source. If I am running my own transport operation, it is more difficult to scale that up or down depending on the deals that the commercial team does. Our third party provider has thousands of trucks and lorries; part and parcel of the way they operate is being able to scale up or scale down as required.”
Network growth
Having been able to hand-off on the IT system changes, Stafford’s gaze will now fall on Williams’ next plans – a return to expansion of the network. New branches are being set up in Manchester and Milton Keynes. At first glance these locations look – are – a long way from the Williams comfort-zone heartland, but Stafford says there’s a perfectly valid business reason why.
“We knew we had some options when it came to further expansion,” he says. “This time, we did the whole grown-up strategy thing. We went to a hotel, sat round a table and looked at what those options were. For starters, we looked at all the horizontal acquisition possibilities. Acquisitions are good in that they get you turnover and goodwill right from day one, but they have to be the right purchase. We couldn’t find anything in our Goldilocks zone – prospects needed to
be a sizeable enough turnover that it would be worth all the due diligence work, but not so big that we couldn’t cope with it. So, somewhere between £10m and £50m turnover would fit that criteria. We also couldn’t find anyone who wouldn’t have destroyed value for us: either they had too much retail business, which is anathema to us, or too much contract business which we didn’t want or they were off-piste in terms of things like spares or heavier products.”
So the company were left with the thought that they could add a branch here or there onto the existing heartland, moving gradually into the northern Home Counties. “We will probably do a bit of that, but it’s likely to take a long time to build up. There’s also the issue that, thus far, every one of those 33 branch managers reports into me. Something that
www.buildersmerchantsjournal.net March 2018
POWERHOUSE PLUMBING MOVE An independent plumbers merchant is moving way
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