Edward Naylor was reluctant to join the family pipework firm but when he did take over he transformed it. Ismail Mulla reports.
Back in 1993 Edward Naylor was a high-flying City accountant working for Deloitte. He’d spent time in Germany as the Berlin Wall came down and was on secondment as a company’s acting finance director.
But then one evening, while he was around at a colleague’s house, he got a phone call saying his dad was dying.
“I dropped everything and came home. He was in Barnsley Hospital and never came out,” says Mr Naylor.
His father left behind a business specialising in pipe manufacturing, but Naylor Industries was in a “dangerous place”.
Mr Naylor said: “If you go back to the 1950s or 1960s the pipe market was all about clay and concrete for bigger sizes.
“By the 80s and 90s plastic pipe systems really started attacking all the key markets.
“We were sort of balanced on one leg and a slightly rickety leg at that.”
With the construction industry suffering from a recession, the business was losing money. His dad had been ill before he died. Exacerbating matters was a difficult relationship that his father had with his uncle, who were both 50-50 shareholders in Naylor Industries.
“My dad had asked me when I graduated whether I wanted to come into the business,” recalls Mr Naylor. “I said ‘what to do? To join in on all the arguments?’ ”
Despite having a high flying career as an accountant and a young family of his own, Mr Naylor took a sabbatical and set to work. His first priority was to stabilise the business.
He said: “We had a lot of bank debt. We had trading losses. An unhappy bank manager. The bank debt was secured over my parent’s house.
“Deloitte were brilliant. They just said take a sabbatical, sort it out and come back when you’re ready.”
Sort the business out is exactly what Edward Naylor did. He bought out his brother, who had inherited a share of the business, and his uncle.
The modern languages Cambridge graduate then embarked on a diversification strategy and sought to boost productivity.
Naylor Industries started making plant pots and established The Yorkshire Flowerpot Company.
A move which Mr Naylor admits is a “bit of a curio for a construction material company” but has proven a success nonetheless.
The Barnsley-based company, which employs 400 staff, also joined in with the plastic pipe revolution.
Edward Naylor took a loss-making £12m manufacturer of clay pipes and turned it into a profitable business that today has a turnover of £50m.
He also ushered in an era of openness not usually associated with family-run companies. A characteristic that shines through Mr Naylor himself.
He said: “My dad’s team were less free with the information but people aren’t stupid. They’d sit in the canteen at Cawthorne and they’d see the number of lorries going out of the door.
“They’d know if lots of lorries were going out the door then things are OK and if nothing is moving in the yard then things weren’t OK.
“In 1993 people could see there wasn’t a lot happening. People knew we had a problem. In a way it was helpful. There was an acceptance that we needed to try new things.”
Communication is a key part of Mr Naylor’s leadership. He spends a lot of time going round the firm’s various sites. Sometimes just “shooting the breeze”.
When he walks out on to the viewing platform of Naylor’s new Wombwell factory, a member of staff waves enthusiastically at him. Mr Naylor says: “I get asked some really good questions from people. Asking where are we or what’s happening with this or why are we doing this.
“If you don’t communicate you create a sort of vacuum and bad news loves vacuums.
“Whereas if you tell people what’s going on, it’s not always good news, then people know where they are and what the challenges are.”
Over the years he has built a team around him that has shown enduring loyalty. A fact that is making it easier to manage the business, he says.
“There’s a huge sense of responsibility,” says Mr Naylor, as unlike in large corporates, where career managers use the firm as a stepping stone, many employees at Naylor are there for the long run.
The turnaround has put Naylor Industries in a position to invest in machinery and open a new headquarters at Wombwell.
Mr Naylor sees further growth opportunities.
“The big trend at the minute is around water management,” he said.
The company last year made a £5m investment in new machinery enabling it to make larger pipes with more capacity.
Mr Naylor said: “There’s more and more impermeable surfaces. In the old days if you got a downpour of rain it used to soak into the ground, gradually work its way down river and end up in the sea. What happens now is you get a downpour, it hits concrete surfaces, heads down river and you get these terrible floods.”
While Mr Naylor grew up around the 125-year-old business, his time in Germany gave him a “really interesting business grounding”.
As the Berlin Wall came down he got to see office blocks with wire taps hidden in the walls by the Stasi. Telecommunications was playing catch up.
It’s little surprise then that Naylor Industries has been described as the English Mittelstand. The firm is family controlled and does things for the long term. And it is thanks to Edward Naylor’s leadership that the long-term future has been secured.
Factfile: Edward Naylor
Title: Chief executive of Naylor Industries
Date of birth: 16/7/63
Lives: Islington, North London with a base in Barnsley
Favourite holiday destination: Norfolk for weekends away: Portes du Soleil for skiing holidays
Last book read: Nothing highbrow I’m afraid - The Secret Footballer
Favourite film: French movie Diva and Apollo 13.
Favourite song: White Stripes – Seven Nation Army
Car driven: Jaguar
Most proud of: Saving Naylor in 1993 when we looked down and out.
Education: Queen Elizabeth Grammar School, Wakefield and St John’s College, Cambridge