Cool operator

Refrigeration specialist Husky recently celebrated its 50th birthday. Graham Ridout learns how the company has grown from humble beginnings into a global player

It's hard to imagine that Husky's unpretentious office and warehouse complex at Lutterworth in Leicestershire is the heart of a world-wide operation that spans

Europe, China, Australia, US A, India, South Africa and Venezuela. It's also hard to imagine that the company's founding family could have envisaged how the business would grow since making the decision to move from pharmaceutical supplies into refrigeration.

Husky's chief executive Geoff Thomasson pays tribute to the foresight of the original owners. "In 1957, food rationing had come to an end and the first self-service convenience store, the forerunner of today's supermarkets, had just opened and the family spotted the need for refrigeration."

Recently, the company sold its one millionth refrigeration unit. However, the sales momentum only really started to gather pace when Thomasson acquired the company in 1992. "I bought it for £18,000 as a pension investment," he says. Adding, with a smile: "It has been a great investment."

His plan was to target independent retailers and offer a complete service, from delivery and installation through to maintenance and servicing. "Within six months, we had gone from two engineers to 26 engineers," he says.

Thomasson says one of the most impressive things for Husky's employees to appreciate, and he includes himself in that regard, is the way the company has grown. Between 1994 and 2001, sales doubled every year and continue on a steep upward trend.

Looking to China

One of his proudest moments was in 1995 when Husky was voted Government Supplier of the Year for quality of service. "It meant a lot to us because we were nominated by the Central Purchasing Unit and we were up against firms providing everything from helicopters and medical supplies to paper clips."

That year was also a turning point in Husky's mode of operation. Thomasson recalls: "The strain of trying to service other suppliers' equipment became too much. So we parted company with the brewers and concentrated on our own equipment."

A couple of years later, the momentous decision was taken to switch the bulk of manufacturing away from Finland and Hungary to China. It now has four factories in China, located in Shanghai and Guangzhou. "It was a very steep learning curve, but we now have a fantastic working relationship with the people out there. The operations are a pure 50:50 partnership with local businesses."

Husky's chief executive says the Chinese factories thrive on high volumes and the quality of the finished products is more consistent than when manufacturing was centred in Europe. Additionally, the cost of the products is lower than 10 years ago. "Why should customers pay inflated prices just because firms want to keep factories open in the West or because some countries slap on high import taxes to protect their own manufacturing base?

"We try to get everything to market at the lowest price. Sometimes we do, sometimes we don't, but it is always value for money."

Chillers and cabinets are still made in Europe, but these tend to be low-volume, specialist units.

Working for a greener future

Thomasson now has his sights set on making even bigger inroads into the US market.

One of the obstacles facing the firm is US legislation that dictates products must pass their official accreditation and testing regime. Thomasson says the regime is far more rigorous than the CE marking test requirements.

Husky has four full-time consultants working on the project, but it doesn't come cheap. "We are going to list 20 to 30 different products and it's costing around £40,000 to get each approval."

Even with a bill that could reach £1.2m, Thomasson is unfazed. "The opportunities are vast in the USA."

He is also proud of Husky's green credentials. Six models are so energy efficient, they qualify for an enhanced capital allowance (ECA). This means buyers can get a rebate of 30% against the purchase price for the tax year in which the equipment was bought.

So far, the uptake on ECA-approved equipment hasn't been overly encouraging. "I don't think people have really grasped how it works, that they can offset 30% against tax."

He is dismissive of some manufacturers who don't take energy efficiency seriously or baulk at paying £1,500 to have an ECA approval test. "It's peanuts in manufacturing terms; to make the machines run more efficiently, you just need more insulation." In Germany, Greenpeace has endorsed Husky's efforts and given it "favoured supplier" status.

The firm's green credentials have been boosted further by this month's announcement that it will recycle, at no cost, a retailer's old fridge when it buys a similar model from Husky.

Thomasson's ultimate aim for his company is getting a stock-market listing. "We would like to go to market in about three years' time. We are talking to some big companies in Europe - it may be a pan-European joint venture, or one company buying the other out."

Free beer deal

All of the branded chillers sold by the

company come with free beer, which usually has a retail price equal to that of the chiller.

Thomasson says: "We get the beer free from the brewers because, effectively, the brand owner is 'buying' space behind the bar for 10 years (the normal life of a chiller)."

He says the main advantage of the deal is that, if the retailer pays £500 for a cooler and gets £500 of stock, it shows up as £1,000 in the profit-and-loss account."

Saunas for the home

To reduce wastage from metal off-cuts, Husky has produced a range of sauna ovens, which it now markets in the UK.

Two sizes are being made - a two-person sauna for £999 and a four to six-person unit for £2,467. Thomasson says: "I hope we have got the price point right for the home market, and the larger saunas are intended for independent hotels. It is a niche market, but it's a way of getting rid of our off-cut metal that was previously wasted."