198-year-old firm confident of survival

Apr 29 2009 by Chris Knox, The Journal

A LONG-ESTABLISHED timber business expects to get back on track this year after having to cut 40 of its staff last year and suffering a fall in turnover as a result off an ailing housing market.

Allan Brothers, of Berwick in Northumberland, saw its work in new private housing dry up last June, forcing it to reduce its workforce to about 200.

The firm, trading since 1811, said it had also seen a marked drop in turnover – usually about £12m – and was expecting to achieve similar sales figures in its current financial year.

The business, which specialises in window and door frames, was set up in Scotland but moved to Berwick in 1866 and is now part of Swedish outfit Inwido Group, after being acquired from its previous owner Palgrave Brown last July.

The purchase was to prove timely as Chorley-based Palgrave became another casualty of the recession when it went into administration last November before closing. Allan Brothers managing director Duncan Forster admits the purchase saved his business from going under and he is confident it can survive the recession with the backing of a larger company which has markets in Denmark, Norway, Finland, Poland and Russia, as well as in its native Sweden.

He said: “Although we have had to make a number of cuts, the fact is that the situation could have been much, much worse.

“The recession pretty much put the brakes on our private housing markets overnight, forcing us to make some tough decisions. However, I think that these measures will be enough to sustain us during the coming months.” In addition to staff cuts, the firm has cut hours, with many working four-day weeks as needed.

The firm, which buys its timber from Scandinavia and its glass from County Durham firm Clayton Glass, has introduced digital bar-coding to keep down costs and employed a fourth nationwide sales representative, in the M4 corridor in the South.

“We realised pretty quickly that you can’t just cut your way out of the recession, which is why we have also introduced a number of measures to ensure we are in a strong position once the country comes out of it,” Mr Forster said.

“We started well last year before suffering a big slowdown by the end of it. This year we hope to reverse this trend and start 2010 in a much better position.”