Timber Garden Buildings (TGB) has bought garden building manufacturer Shedlands, as more consumers choose to invest in their homes and gardens until the economy gets on an even keel.
Rotherham-based TGB has secured £300,000 funding from HSBC to seal the acquisition.
The company, which has 80 staff, supplies customers across the UK with garden buildings including timber garages, sheds, timber workshops, children’s playhouses and places for pets to live.
Graham Vernon, the managing director of TGB, said he had been in talks about buying Shedlands, which is based in Thurcroft, near Rotherham, for between two and three years.
He knows the company well, because he used to be the firm’s finance director.
He said yesterday: “The planned growth for both brands, without any further acquisitions, is to reach a turnover of £12m within the next three years, and £16m over the next five years.
“The growth will be organic, but will be led by an aggressive marketing campaign early next year to re-launch the Shedlands brand throughout the UK.”
He said TGB, which currently turns over £6.2m, plans to enter other markets in the next financial year. According to Mr Vernon, this should help to smooth out the seasonal trends associated with the industry. He was cautious about economic prospects for the UK.
“Our projections are without the added assistance of some level of recovery,” he said. “On a like for like basis, the market is down by 40 per cent and it is difficult to envisage a recovery in the housing market any time soon.
“Once the economy is in recovery mode and our growth is secure and consumer confidence returns, our market will increase further than our forecasts, as our forecasts take the view the recovery will be slow.
“I’m confident about the products that we manufacture, although I’m not sure about the market itself. If you look at the overall economy, consumer confidence has taken its biggest dip for eight months. One or two of the bigger companies in our sector may not make it.”
Mr Vernon believes cash incentives should be offered to encourage firms to take on more staff.
He added: “The only Government funding that appears to be around at the moment is with regards to subsidies on training and new apprenticeships.
“Gone are the days when you could apply to the DTI for a grant contribution and be helped to advance your business.
“Serious consideration needs to be given to ways of really helping small and medium-sized enterprises. Grants for training are fine, and I am sure some businesses are benefiting from the £1,500 apprentice subsidy... but creating full-time and permanent positions for people without jobs has to be a priority.”
At the time of the acquisition, Shedlands had 10 staff and a turnover of around £1.2m.
Martin Nattrass, area commercial director for HSBC in South Yorkshire, said yesterday: “With a challenging economy still affecting the housing market, many homeowners are choosing to invest more in their homes and gardens.”