Supporting the sector

Santander’s Charles Garfit shares how the financial institution has recognised the value in manufacturing and what the bank is doing to support its future.

Garfit took up the post of head of manufacturing for the UK in January 2014, a new role specially created by the bank to support its commitment to lend an additional £500m to UK manufacturing businesses over the next three years.

Background

Santander entered the corporate commercial market place almost six years ago when it acquired the Alliance and Leicester and Abbey National building societies.

Within Alliance and Leicester at that time was a small corporate and commercial bank. Garfit told TM that “we systematically set about growing over the last five years and have grown from about 1.5% market share in the UK to roughly 6%.

“We have an ambition to grow to 10% of the UK market, which is where we would feel comfortable.”

Garfit says that institution bosses realised the global importance of offering the UK full-service banking, ensuring that Santander was both in retail and new market space.

SMEs and the banks

“After the recession hit SMEs battened down the hatches, rode out the horrendous conditions and effectively lost the appetite to go out there and leverage up,” says Garfit, but he believes that “the tide is changing”. However, that is not to suggest that manufacturers are not still facing borrowing challenges.

“Manufacturers sometimes struggle in their ability to communicate with financial institutions.

“When presenting, businesses need three years of accounts, audited and a narrative behind it to articulate why the numbers are as they seem.

“From that point, it is being able to paint a coherent tale of where you want to take the business and convince a financial institution that you have modelled a variety of different outcomes.

“We love optimistic businesses, but we enjoy realistic businesses even more.”

What is Santander doing differently?

To offer both a full-service bank and gain 10% of the market share, Santander has identified two key sectors in agriculture and manufacturing, Garfit maintains: “With manufacturing being arguably the most important”. The bank has set out to articulate its ambition and strategy in a number of ways.

What Garfit calls ‘tangible outputs’ are the creation of teams throughout the bank’s business centres that specialise specifically in manufacturing to ensure small to medium-sized businesses have access to expert resources.

He continues: “What we are doing, which is somewhat unique, we are not only training our relationship guys, we are bringing risk into that.

“We recognise the importance of making sure they have an understanding specifically for the sector, so building their knowledge is important and that programme begins in October/November time.”

Santander’s roadshow series will also provide a set of tools to educate manufacturers on how to present themselves to the bank. Garfit says: “For these, we are going to pull some very senior people from risk out into the regions to deliver that training and we hope that’s really going to add some value.”

The bank on tour

Santander is also involving itself in summits and conferences up and down the country to place itself as Garfit puts it “at the centre of the manufacturing conversation”.

Garfit adds: “The SME Summit, which has a very key manufacturing focus, that’s taking place in Birmingham in November, follows on from a number of summits around the country and they are superb opportunities for manufacturers to share their experiences.”

In addition, the bank has recognised the importance of advanced manufacturing. Garfit enthusiastically references the Advanced Manufacturing show, taking place at the NEC in November, which Santander are sponsoring.

“It’s in the interest of our customers across the United Kingdom. We’ll be having a stand there and are looking forward to meeting lots of different people. The advanced sector is going to be of increasing importance as the years go on and it’s a space where we can really start to add value.”

The future for Santander

Garfit makes it clear that Santander is passionate about manufacturing and will continue to do everything in its power to support the strengthening of the sector.

“There are lots of exciting things happening in 2015 particularly with The Manufacturer magazine, we are delighted to be sponsoring the Future Factories Series, we have done the first one of those and are looking forward to the next one in February.

“We are looking to do significantly more than we have done in 2014.”

 Successful Modern Entrepreneurship Summit 2014

On October 15 more than 80 small and medium sized enterprises from the Midlands came together at the Successful Modern Entrepreneurship Summit organised by Santander and The Times, to hear from some of the UK’s most successful entrepreneurs on how to capitalise on the strong resurgence in the manufacturing sector.

Held at Fazeley Studies in Birmingham, the summit kicked off with a welcome address from head of UK banking at Santander, Steve Pateman, included a panel session to discuss today’s manufacturing opportunities with various business leaders in the sector, as well as a keynote speech from Ian Maclean, managing director at 230-year-old UK knitwear manufacturer, John Smedley.

Topics for discussion throughout the summit included access to finance, cash flow forecasting, international growth, modernising/upgrading, people cost and skills and competitive strategy.

Charles Garfit, head of manufacturing and Santander Corporate told TM that the Summit was a “superb opportunity for manufacturers to share their experiences about what they have achieved, how they have achieved and give some tips for success”.

He added: “There’s networking opportunities. It gives us the opportunity to go and be at the centre of the conversation.”

Garfit said that he was “delighted” John Smedley’s MD, Ian Maclean, was providing a keynote “given its history and having the opportunity to take them on as a customer after it had been with its last bank for so long. We are really please that they are supporting this really important event and sharing their story with our customers.”

Ian Maclean, managing director, John Smedley, said about the conference: “The manufacturing sector is often the breeding ground for the UK’s most innovative entrepreneurs and fast growth companies.

“The SMEs attending this event benefitted from the advice, knowledge and experiences of people like them who have navigated the challenges and can share their success stories.

“Establishing networks like this is essential for the continued growth of like-minded SME businesses. This is good for the region and good for the UK economy as a whole.”