Clearing the air

Clearing the air

Nick Heaton may have joined Harrogate-based Envirovent without knowing what exactly he was getting into, but he soon worked out how to make it a success. Michael Clarke reports.

“It was a leap of faith” says Envirovent managing director, Nick Heaton, remembering how he joined the business in 2004. “The founder, Frank Farmer, who was then managing director, invited me to join,” says Nick, who was then sales manager for Fans Direct, near Cardiff, a subsidiary of a competitor, the Nuaire Group.

Nick’s father, Peter, was already working for Envirovent, and still looks after the North West. “He’s always been very inspirational and supportive and also turns in very good sales figures,” says Nick, who insists that wasn’t how he first came to the attention of Frank Farmer.

As it happens, Farmer was already familiar with Nuaire, having worked for the company some years before. “And I knew Frank because we had met at exhibitions,” he says. “I was doing well at Fans Direct, earning good money and making a name for myself in sales and was not ready to leave it behind.

“I told him so and he said: ‘This is bigger than a sales job’. Frank said he was looking for a sales director. He thought I was maybe the one and asked if we could have a chat.

“I came over to Harrogate and met with him and finance director, Ron Russell-Hobbs, who is still part of the management team, and Frank said he had a new product that he believed could really grow Envirovent - the only problem being that, as I worked for a competitor, he could not tell me what it was.

“He made me an offer and I had to decide whether or not to take it on the basis that the product - which I had not been told about - was good enough. It was a leap of faith but Frank’s enthusiasm made me accept.”

Nick, who lived with his wife Donna and four children near Preston, started at Envirovent as sales director, making the 130-mile daily return commute to Harrogate to work with a sales team which included his father, Peter. The product, it turned out, was the Envirovent filterless extractor fan.

So was that leap of faith, with all its upheaval, worthwhile? “When I first saw the fan, I thought Frank’s enthusiasm might be misplaced,” he says. “However, when we started to investigate the potential and develop a proper sales strategy, we found that he was right. There was quite a big opportunity ahead of us.

“To be fair to Frank, because he was the person who made all this happen, I do not think that initial sales strategy was what he really intended. He knew there was an opportunity but may not have appreciated the scale of the potential. At that time, Envirovent was only a small specialist condensation and mould control company and I came in from a large manufacturing background and had a broader perspective.”

Like earlier Envirovent products, the filterless extractor fan, specially designed to combat condensation and mould, was innovative and still is. By using a technique called cyclone separation, the fans do not need filters or maintenance. They are made from recycled plastic and built to last the life of a property so they do not end up in landfill sites. The chosen strategy was to market the fans to local authorities and housing associations, stressing the environmental, low-maintenance and low-cost benefits in an effort to get them specified in all `decent’ homes and housing refurbishment schemes.

The success has been stratospheric. When Nick Heaton joined, Envirovent had 30 staff, including seven installation engineers, a £2m turnover and “virtually no growth”. Nick set about developing sales and contacts.

“We sold 20,000 units in year one, and should sell five times that in 2009, and we don’t get any back,” says Nick. Today Envirovent has a turnover fast approaching £12million, 150 staff, including 32 installation engineers, and has just received a Queens Award for Innovation for the filterless extractor fan.

Nick, who insists despite everything that he is not driven by money or personal ambition, says he first approached Farmer with a buy out plan in 2007. “There was a lot of venture capital money flooding into the industry at that time,” he says.

“I was convinced that market leaders were on the acquisition trail and was worried that if Frank got an offer he could not refuse, all that was special about Envirovent would be swallowed up by a bigger organisation. I just wanted to preserve and grow what we had, so I reminded him that I had made a huge personal commitment in travelling and then relocating my family from Preston. He eventually agreed and was able to retire with a few quid in his pocket, though we are still in touch.” Not long afterwards, however, Nick opted to be taken over by a larger corporation after all, although he says he only went with Soler and Palau because he believed it would allow Envirovent enough freedom to carry on operating as it had been doing.

“They are a family-owned business and among the three top fan manufacturers in the world,” he says. “I compared doing a deal with them and taking a smaller share, coupled with long-term support with using venture capital.

“It seemed more attractive than raising cash through a finance house and then having to do the same again a few years later when they decided to get out.” However, initially there was a challenge in selling the filterless extractor fans.

“They cost twice as much as traditional fans so you have to persuade people to buy into the long-term value and environmental benefits rather than the cheap fix,” he says. Before working for Envirovent, Nick’s parents Peter and Audrey had moved to South Africa where Peter worked as an electrician. Both Nick and his elder brother Stuart were born in Johannesburg. The family later lived inCapetown and returned to Lancashire when Nick was two years old. Seven years later they moved to Perth, Australia, where his younger brother Jason was born, but they returned after a year when Nick’s mother became homesick.

Nick finished his education at Penwortham Priory High School, near Preston. “I didn’t have a huge interest in lessons,” he says. “Living abroad seemed to open my horizons and I was busting to enter the outside world. I was good at most sports though.

I’m fairly competitive and I like winning.” He left at 16 and became an apprentice electrician with Manchester-based Norweb and completed eight years, including two as an underground cable jointer, restoring live cables.

“Whenever there was a fault, I had to dig down and repair it without cutting off the supply. It was quite dangerous work and I often blew myself out of the hole,” he says.

“I could see guys in their 50s doing the same, mundane job all their lives and decided I needed to get into sales to really progress. I was ambitious, and still am.”

Eighteen months followed as a sales representative for an electrical wholesaler in Preston before moving to large European fan manufacturer, Vortice, as a North West sales representative. After four years he was national sales manager and on his way to Fans Direct.

Envirovent – initially Farmer Controls – was founded by Frank Farmer in Knaresborough, Harrogate, in 1987 with a simple, intuitive recognition which has been at the heart of the business ever since: the more we insulate our homes for energy efficiency, the more we trap stagnant, `bad air’ into properties which traditional fans are unable to shift. This harms our health.

Frank Farmer’s first product – and one for which sales are now gathering pace on the back of huge interest in the filterless extractor fan - was the positive ventilation system which operates constantly and silently in household loft space, providing a continuous supply of fresh, filtered air and combating mould and condensation which are nurtured by excessive insulation.

Nick says: “Whereas most fan manufacturers simply threw two fans into a property and believed that does the job, Envirovent recognised a real health problem. Just think about reports of `sick building syndrome’ years ago. We were selling a total service and solution.”

The average person, he says, produces four pints of moisture a day - a family of four creates 16 pints, or 112 pints a week.

This combines with indoor volatile organic compounds such as sprays, aerosols, formaldehydes, dust mites, mould spores and possibly radon gas.

“When you see tiny specs in a ray of sunlight inside your home, 80 per cent of that is human skin,” says Nick. “A government report has said that 50 per cent of the world’s illnesses are caused by poor indoor air. Most are caused by the air we breathe in our own properties. By sealing our properties up and failing to address the ventilation, the indoor air in our homes is now up to 70 per cent more polluted than the air outside.

“We’re growing Envirovent by addressing these very real problems, as well as creating low-maintenance products made from recycled plastics; whereas our competitors have just been selling products.” After becoming managing director, Nick’s initial work involved developing a nationwide network of about 50 installers and sales managers around the UK.

In 2005, he took the business into France, which has now generated 2,000 sales. The Republic of Ireland followed soon after as well as Australia and New Zealand.

“Sales are going to go very well in New Zealand,” he says. “They have a very similar climate to us and we have a very good, focused distributor.”

Since he joined in 2004, Envirovent has enjoyed 30 per cent year-on-year growth, though he concedes that 2009 – the bleakest year for the economy for half a century - has been tougher.

“I am expecting this year’s growth to work out at about 21 per cent” he says. “But this is during a period when sales in the industry as a whole have fallen by between 15 and 20 per cent, so we are still moving forward.

“The success of the Yorkshire business during the last five years is leading some of its competitors to emulate its approach.

“We are coming across competitors’ marketing material which looks like it has been copied straight out of our own brochure,” he says. “We are cautious about this. Some of these copyists could get our products a bad name by adopting the approach of shifting units quickly, rather than offering a quality service.

“We are monitoring it carefully.” So what, after such success, does he expect for Envirovent as the economy starts the long haul back to sustained growth? “Getting the Queens Award for Innovation this year has given a huge credibility boost to the filterless fan,” he says.

“It also justifies the decision of those who stuck their necks out when we were unproven.” As well as gaining a Yorkshire Post Business in Excellence award in 2008 for companies under £10m, Envirovent has gained a UKTI best new exporter award and Nick Heaton has received a personal accolade from the Institute of Directors for the company’s positive impact on the environment.

“This year, we have invested £500,000 in research and development, which has resulted in several new products and marketing strategies which will be unveiled in 2010,” says Nick.

“On top of this, we have split the business in two so, instead of being focused just on indoor air quality in social housing, we are targeting enhancing air quality for new-build properties to enable developers to meet the strict requirements set out by the Code for Sustainable Homes.” But what about ambitious Nick Heaton? With all this success at only 37, will he be tempted away from Harrogate towards a job with a global enterprise? He says: “When I took over as managing director, I agreed with all the staff that there is one single big objective to focus upon, and that is to become market leader in indoor air quality systems in the UK.

Every day when we come to work, that’s what we’re all thinking about “I don’t believe we’re that far away from that objective now and, by the end of 2012, I want a £20m turnover.

We set out this aim in 2007 and, since then, we have doubled the size of the business.

“I do believe that, in time, Envirovent will be a truly global company and I have every intention of being here when that happens.