A subsidiary of the global company Classic Industries, an entity with sites in Texas, Pennsylvania, Puerto Rico and Shanghai, Classic Industries Europe was acquired in 2009: “Based in the North East of England, the company manufactures plastic components and devices, which are then supplied to the medical, health care and pharmaceutical industries,” explains John Pearson, director of global operations.
“Like its parent company, the core business of Classic Industries Europe is centered around plastic injection molding,” John continues. “The customer base is predominantly made up of global, blue-chip, original equipment manufacturers and include some of the largest medical and pharmaceutical companies in the world. The UK operation itself has actually been in existence for some 25 years and today employs 50 personnel. These experienced individuals help produce plastic injection moldings, make plastic parts and also carry out the assembly of those parts into complete medical devices. These are then sterilised, packaged and shipped directly to the manufacturers, which then distribute directly to hospitals, clinics, private practices and the like.”
In John’s opinion there are several key elements that have helped distinguish Classic Industries Europe and its parent company: “Firstly, the business has invested significantly over time in its collection of electric injection molding machines. Historically other companies have utilised hydraulically operated machines, however the electric variety used by Classic Industries are recognised as being much more energy efficient, meaning they can produce a vast quantity of technical parts at a reduced cost, while maintaining a huge amount of accuracy.
“Equally as important is the commitment the company has towards training its workforce and providing each employee the flexibility needed to carry out their work to the highest possible standard. This then translates into higher performance levels throughout the operation, which in turn means greater quality levels. Classic Industries Europe measures this in the number of defect parts it identifies per million, as opposed to a percentage figure. The most recent results show the company operating at under 100 defect parts per million, a figure that falls in line with recognised world class levels within the plastic molding industry. This fact follows the recognition that during its first 12 months as part of Classic Industries, Classic Industries Europe outperformed the company’s other sites around the world in terms of quality, performance, customer satisfaction, delivery and profitability.”
Nevertheless challenges do still remain, namely the rise in energy costs, an issue the company is facing head on with the creation of numerous energy saving schemes, and the rapidly changing nature of the market, particularly when it comes to raw materials: “The main material used is polymer and that is very susceptible to exchange rate movement and other volatile factors such as the price of oil,” John states. “The unenviable position this puts the company in is that as supplier costs rise, customers are still pushing for lower costs, squeezing at both ends, making it harder to find ways of further improving productivity.
“What Classic Industries Europe is doing to counteract this is improving its level of automation and the continuing further development of its employees through increased levels of multi-skilling and flexibility. This automation also keeps labour costs down. This has helped through the recent economic downturn and avoided the need to make any headcount reductions of the company’s highly valued personnel.”
The reward for this work can be seen in the 30 per cent growth in sales that Classic Industries Europe has experienced over the last two years: “In this time the company has established contracts with three significant customers from within the medical industry,” John says, highlighting one notable achievement in particular. “One of these contracts has resulted in Classic Industries Europe being chosen to supply a company’s sites in Germany and the Czech Republic. The ability to serve these countries with high specification technical parts is a good accolade to have given their reputation for having a very strong existing supply base. It indicates clearly that companies in the UK can compete within other European economies.
“These new contracts, like the majority within the medical industry, have rather a long gestation period, in some cases as much as two years, from receiving the initial inquiry to turning it into production. During this period of time a great deal of work needs to be done in terms of the design and manufacturing process. While this does take time the overriding positive is that come 2013 the company can be confident of turning over approximately 30 per cent more than it did in 2011.”
Clearly benefiting from its parent group’s focus on Europe, Classic Industries Europe holds a long-term vision as to what it hopes to achieve in the years ahead: “Looking at the group’s five-year plan, the desire is to double the size of its UK operation, while almost certainly looking at making further UK and European acquisitions down the road. This really shows that Classic Industries sees Europe as being an area of huge opportunity when it comes to growing its business on a global scale,” John concludes.
Classic Industries Europe
Products Plastic components and devices