Having built up and sold one of the UK’s first rapid prototyping businesses Gordon Styles, CEO of Star Prototype and an entrepreneurial engineer from London, became so frustrated with the difficulty of financing subsequent ventures that he fled to China to apply his expertise there. From that rapid growth, investment-ready nation, Mr Styles observes the environment for manufacturing in the UK with disappointment.
TM: In May, at a personal expense of £10,000 you published a letter in the Financial Times defining a 10 point plan to reform UK economic policy and release the potential in British industry. How do the measures outlined in the industrial strategy, which Vince Cable announced in September, match up with what you suggested?
GS: Too little too late. Cable’s strategy gives the new business bank £1bn which will leverage £10bn for British companies. But UK manufacturing needs £50bn over the next five years if the economy is to rebalance. If it was lent this – not given – British industry could double in size in just a few years. In my letter I set out points for economic reform which would really make a difference including banning fractional reserve banking and giving the treasury complete control over the creation of UK currency. We must control M4 money supply if we are to break out of boom and bust.
TM: Frustrated with the difficulties of running manufacturing firm in the UK, you moved to China and founded Star Prototype. How different is the reality of manufacturing in China compared with common perceptions that it is a place to ‘make cheap and stack high’?
GS: The Chinese government is very clear about its intention to create a high value add manufacturing base within the next five years. We hear stories of textiles and toy factories which employ thousands of workers going bust in China. The government isn’t bothered. That business can go to other, emerging economies like Thailand and Vietnam. What it wants to see growing is high tech manufacturing and it supports this through actions like dropping import duty on high tech goods to zero. Manufacturing firms in China are buying the best kit from Europe like it’s going out of fashion.
TM: How much of what you produce in China do you export to the UK? About 25% – this equates to around £1.5m worth a year.
GS: Most of our orders in the UK come from design firms. This differs distinctly from the US where we get a lot of work from blue chip organisations.
TM: Would you ever bring production back to the UK?
GS: It is unlikely but not impossible. In large part my reluctance would be due to my personal experiences of running engineering firms in the UK. Frankly, my experiences trying to finance and support my businesses there were traumatising and I know there are many other engineers like me who are suffering the same stresses. In China life is better. I pay very little tax. I own 100% of my company which is cash rich, has never had to borrow money and is just scraping the surface of funding opportunities. It’s a tragedy that this is so far from the case in the UK because I do believe that there is something special about UK engineering and UK industry. It is extremely innovative and up for a challenge – but there needs to be government incentive.