Taking redundancy into business

Taking redundancy into business

Entrepreneurs who have lost their jobs due to circumstances out of their control reveal how the path to enterprise gave them a new lease of life

People start businesses for a number of reasons, whether they have a burning desire to be their own boss, want to turn their hobby into a business or even to follow their childhood dreams.

As we see in many of our entrepreneurial success stories however, the impetus for many business owners to start up quite often stems from redundancy.

So whilst the national media dwell on the job losses at Walkers in Peterlee, McCain in Scarborough and potentially Vauxhall in Luton, we thought we’d take a look at some of the inspiring entrepreneurs who have battled back from redundancy and are making a success of it themselves.

First up, we have Karl Vernon, Mark Evans and Wilf Hobson, who were three of the 98 people who faced losing their jobs when Doncaster manufacturing company Norking Aluminium went into administration in May 2014.

Now, they are directors and owners at Mettech Fabrications Ltd in Balby, after they invested their redundancy money into crucial equipment from the closed down Norking plant.

The company, which now employs a number of former Norking staff, manufactures press metal work, aluminium and steel bracketry for the construction industry from the ex-Norking site on the LKH Estate in Balby.

Karl, who was previously Norking's purchasing manager, said: "I was one of the last people to be made redundant at Norking and had often thought about running my own business but never had the opportunity.

"We all knew the sector inside out and saw there were still opportunities for business out there.

"For us, redundancy was an opportunity to change and it was the catalyst to set up our own company.

"We put an offer in for three pieces of machinery to the administrators Wilson Field and our redundancy money funded the acquisition and allowed us to buy the assets.”

Another business born from the downfall of an industry is Teesside-based LGV training business Cleveland LGV Training which was launched just over a year ago.

Middlesbrough dad Dan Wilcox launched the business with support from SSI Task Force funding, only one month after losing his job at the steel plant.

Joined by his son-in-law Matthew Switzer, the pair identified a gap in the market after discovering a three-month waiting list for LGV lessons and tests in the North East.

Having secured a number of contracts for significant local companies, including work with PD Ports, and receiving interest from companies in Belgium, Holland and Sweden, the firm is continuing to grow.

Speaking at the time, Dan said: “Initially I was looking for work and had a few offers in the transport industry, but I felt there was an opportunity in training and I was hoping for a new challenge after having driven commercially for more than 20 years.

“I could never in my wildest dreams, have imagined the success we currently are enjoying.”

Another great example is Midlands entrepreneur Chris Carswell who decided to take his redundancy when his employer was bought out by a much larger corporation.

Working in IT services, he spotted a gap in the market for technology which could help ease the process of arranging home services and repairs.

He said: “My business partner and I both worked for the same firm, and so we had some insight into what was going to happen after the sale, in that there would be an opportunity to fill a gap in the market, so I took my redundancy and survived on that whilst we established Rightio. It was a calculated risk but it was a fantastic opportunity to do something special.

“When we started the company there were just two of us in the office, so I had to learn quickly how to operate every aspect of the business, from dealing with customer enquiries to speaking to our engineers in the field.”

Rightio is now six and a half years old and Chris has never looked back. He added: “It feels like only yesterday when Karl and I completed our first job.

“The six years following that very first call have resulted in a wonderful, rewarding journey thanks to the hard work and dedication of our outstanding employees.

“With each success Rightio encounters, it is exciting to contemplate how much more we will achieve in the future.”

Most people, as seen in the examples so far, set up a business using the skills and knowledge they’ve developed in their previous jobs to launch a new business.

However, after being made redundant from her marketing job, Scottish entrepreneur Raine Davidson decided the time had come for her to do something completely different.

Raine, from Rosneath in Scotland, wanted to use her creative skills of DIY and knitting to start a business making traditional home and fashion accessories with a modern twist.

With support from Scottish business support programme Business Gateway, Raine launched The Little Stitch Company and is now selling her homemade products online and at craft fairs across the country.

She said: “I’ve always enjoyed practical hobbies such as furniture restoration and DIY, and have always liked making things. Being able to say ‘I made that’ has always appealed to me and after being made redundant it was becoming increasingly important that I could be the master of my own destiny.”

“I’m very excited about the future and in honing my creative skills,” she added. “I’ve found talking to others within the business world, particularly my Business Gateway adviser, has helped clarify my own thinking.”

Like many of our successful start-up business stories, the business support Raine received was invaluable in helping her get The Little Stitch Company off the ground.

She concluded: “I signed up for the free Business Gateway workshop on bookkeeping, because although I am financially savvy, I’ve never had to do accounts before so I found this course extremely useful. I also learned a lot about using social media.”

Interested in reading up about the business journeys of more successful entrepreneurs? Take a look at our entrepreneurial archive