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Caravan carry-on: turning around a family business

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30th Aug 2005
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  • Working in a family-owned company has its charms. But uncertainties regarding eventual succession can take their toll on innovation and morale. Sometimes, it takes a new owner, with new ideas, to breath life into an old company. John Moorhouse, managing director of Harrington's Caravans, tells AccountingWEB how, after 15 years of keeping things ticking along, he's now raring to go.
  • Harrington's is a family-owned business, established in Lancashire in the 1930s, (a golden age for caravanning, when the roads where delightfully free... of caravans) and purchased by the Holloway family in the 1960s. The business built a reputation as a strong local firm that cared about its 57 full time employees, and was increasingly, recognized as a leading brand in the caravan distribution business.

    Eight years ago owner Paul Holloway retired to Guernsey. But succession was a problem. Although, had two daughters, one of which worked in the company, neither expressed a desire to assume management. A number of local and other businesses offered the chance to hook up, but Holloway insisted Harrington's would only ever accept a tow from an acquirer that maintained the company's family ethos and brand name.

    Upon his retirement, Holloway had left effective running of the company to managing director John Moorhouse, who had joined Harringtons in 1990 from an executive sales position at WH Smith. Moorhouse had kept the company treading water. But earlier this year, things started happening fast.

    Made an approach by local entrepreneur Philip Wilbraham, Holloway was reassured that Wilbraham would not only keep his company's ethos intact, but develop it further. And there was a twist - Wilbraham's purchase vehicle, Sign Lease, was itself a target for Titan Move, a company which looking at acquiring a number of family run companies to groom for flotation onto the Alternative Investment Market (AIM).

    At first, the potential for disruption sent a frisson of anxiety through the company. "I had to stand up and tell staff that I didn't know what was going to happen. There was a lot of uncertainty," says Moorhouse.

    For Moorhouse, there has been a distinct change of pace. "Knowing that [previously] an exit was on the cards, but not knowing what it would be, meant that company growth was restricted. Before, I was just a steward. Now I'm on the lookout for acquisitions. It also means that we can start to revisit some of the ideas that we'd explored but had never implemented'"

    Harrington's didn't lose a single member of staff, despite its acquisition by Sign Lease. Moorhouse predicts that the acquisition by Titan Move will also keep the workforce intact and the Harringtons name in place. Support from staff has been unanimous, he says: "Over 50% of the workforce has taken up an offer to buy shares in Titan Move plc. It's been really rejuvenating. There's an air of 'the king is dead. Long live the king'."

    Moving toward an AIM leasing as part of a bigger entity creates new professional challenges for Moorhouse. But he says that setting his sights higher "frees him up." An immediate effect of the Sign Lease acquisition was that he could start looking at the management potential of staff whose career progress had hitherto been stymied by the essentially static nature of the company. Appointing an under-sales manager has also given Moorhouse more scope and breadth to look at the longer view.

    For the moment, he's taking a "slowly, slowly, catchee monkey" approach to the future; and considering the options. For a start, he's on the lookout for similarly-sized family-run businesses in the leisure industry that could be acquired by Titan Move, with the intention of rolling-out the Harrington's brand and formula. This, he says, is very much in keeping with previous owner Paul Holloway's vision for the company after purchase.

    There are also issues in house to attend to. One priority is to explore the benefits of a fully-functioning internet sales site. Currently, Harrington's offers 8,000 product lines but, although it has a website, it isn't possible to buy products on line. Also it can't grow on its present site - as it is prevented from doing so by local planning laws.

    From a strategic point of view, the most significant decision that needs to be made is whether to branch out from caravanning to other leisure areas - not just camping, but gardening, and perhaps, "extreme sports" such as mountain biking and climbing. But recruiting the right staff to make it happen is difficult.

    Nevertheless, these are issues Moorhouse is glad to be given the opportunity to address. "We're in expansion mode'," he says.

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