Ben Roberts has grown Clogau, his father’s Welsh gold business, into a jewellery chain with stockists throughout the country, as Maria McGeoghan discovers.
It sounds like the start of a Famous Five book. When he was just a small boy, Ben Roberts was taken out of school to have a look at his dad Bill’s latest acquisition: a gold mine.
It had been abandoned for years and Bill’s big idea was to transform it into a tourist attraction where visitors could pan for gold. But, due to its location within the Snowdonia national park, planners stood firmly opposed to the idea. So, as a Plan B, Bill decided to gamble that there might be some undiscovered gold still buried within the mine. And to say that gamble paid off is something of an understatement.
It was the start of Clogau, the classy Welsh jewellery brand that has grown into a multi-million-pound business. Its headquarters is in North Wales, where I met managing director Ben in the boardroom, the door to which is kept open by what looks like a gold ingot.
“Oh, that’s not real,” says Ben, who knows a thing or two about gold. “I remember being taken out of school to have a look at a hole in the ground. It wasn’t that impressive.
“My dad Bill wanted to open the mine as a tourist attraction. He thought that people might want to see where the royal family had their wedding rings made. This was 1990 and Snowdonia tourism was far from receptive to the idea. They took public objections quite seriously.
“Bill had just sold his frozen food business to Iceland, so he was doing OK financially. He probably spent £2m on that project. He’s very good at starting a business and getting his way.
“I like to think I’ve got enough people around me now who will tell me if I’m going too far.”
As Bill struggled with the Snowdonia planners, he employed three miners who were related to miners who had worked the original site. They did odd jobs but then started to work down the mine and there really was gold in “them thar hills”.
“Dad used to bring home one of those plastic 35mm film cases full of bits of gold,” Ben remembers. “It’s called Dore gold and is 80% pure.
“I remember there was a miner called Jack who had worked with geologists at the site years before and Bill took his advice.
“Jack remembered where they had found the gold originally. It was called the ‘Grandfather’s adit’ – or seam. They found gold and Bill flew down there really, really excited but when he got there the seam had gone again.
“Jack said that mining for gold was like looking for the jam in a Victoria sponge, but mining for Welsh gold is like looking for the sixpence in a Christmas pudding – because of the Welsh terrain. I’ve always thought that’s a great analogy.”
There was enough gold to keep Bill’s new idea of creating jewellery going for the first year, and then he came up with the idea of diluting the gold and mixing it with world gold. Their first range of jewellery was launched in 1994 and consisted of just five pieces that were sold through a handful of small gift shops near the Clogau St David’s gold mine.
Due to its scarcity, only a small amount of Welsh gold can be included within each piece of Clogau jewellery, which ensures the longevity of Welsh gold supplies and the affordability of the jewellery.
“A lot of people looked down on that, and said you can’t dilute it,” says Ben. “There was a lot of scepticism in the market.”
The company started to build up its brand, while Ben studied marketing at university and started work in Southampton. “I was earning £32,000 a year and Bill offered me £8,000 a year to join the team. I said I would give it six weeks.
“We set about establishing Clogau as the word for Welsh gold. The loose translation is gold rock.
“Bill had started a new business making health and safety videos and he left me to follow it through.
“We are a good story. We are authentic. We were the only people with a mine.
“We established really quick delivery and good quality workmanship. We set up a workshop in 2000 and bought machines that made the job of extracting gold from the rock so much easier, like belt furnaces and laser welders.”
Another big turning point for Clogau came when it started to make coin jewellery for the Royal Mint and realised that it couldn’t compete on price. It started to investigate manufacturing in China.
“It was very good quality and very fast from order to delivery six weeks later,” says Ben. “The manufacture was very specific to us, which was very important.
“By then, Clogau had 200 stockists, sold on QVC and people began to recognise us as a Welsh gold brand.”
The move to production in China meant the closure of its own workshop and redundancies, but, as a business move, China was a game changer. Turnover went up from £2m to £5m with a 20% net profit. “Gold was cheap, it was two dollars to the pound,” Ben says. “Returns reduced from 7%, to 1%. It was the right thing to do. We’ve been quite recession-proof and by chance we’ve been growing through recessions like in 2008.”
Bill is still involved as the majority owner and chairman. “Well, that’s what he shouts across the pub to me,” says Ben.
Clogau now has more than 340 stockists and eight of its own shops, 130 staff, and turnover of £16m with 20% net profit. And, for the first time this year, it will maintain profit and turnover levels rather than the steady growth it is used to. “It’s a combination of things,” says Ben. “There’s the election, terror attacks, the dollar and Brexit. For the first time, we are staying at £16m turnover.
“Luxuries are down. I think we are niche but mainstream.”
Future plans include concentrating on retail by looking at sales hotspots and opening shops there.
Clogau also support designers by sponsoring design competitions, and now produces 50 new designs every six months, many with its now famous “tree of life” motif.
“Some designs do well and some don’t,” says Ben. “It’s 80-20. You don’t really know what’s going to take off. We used to launch just two products a year.” And, rather than writing off products that don’t sell, they are now sold in “soon to be discontinued” stores where profits are good.
So, what is Ben’s secret to running a profitable and successful business? “Everything drives me to find the perfect information,” he replies. “I don’t want it in six weeks’ time, I want it now. We’ve worked hard on that. The information shows us how we are doing and everything is live. And I know it’s a cliché but we have a very good team. And consistency is also really important.”
And is there such a thing as gold fever that can take you over and turn your head? “Oh yes, definitely,” he says. “When we were kids we used to pan for gold flakes and when we found one we would ask dad how much it was worth. We would just want to keep going and going to try and find more and more…”