January 26 2015 Latest news:
Heatrae Sadia commercial director, Steve Rickards, right, and head of marketing, Jon Cockburn, talking to lead operative John Davies, left, in the factory by the automated machinery. Picture: Denise Bradley
By shaun lowthorpe Business editor
Wednesday, September 26, 2012
Water-heating specialists Heatrae Sadia has invested nearly £2m in a new automated production system at its Norwich factory as it eyes new markets in solar renewable energy and the commercial sector.
The firm, which employs 221 staff mostly at its base in Hurricane Way, said the new facility comes as it marks the 25th anniversary of its pioneering Megaflo unvented hot water heating systems, which are manufactured in Norwich.
The market-leading systems are a common feature in many new build homes, but with the housing market slowing in recent years, the firm has been pursuing other areas of potential growth as well as export markets, particularly in Russia and New Zealand.
And the investment tops a remarkable period for the company, as it also emerged that it had previously delivered a £7m contract to fit the Megaflo systems in the athlete’s accommodation at the 2012 Olympic village.
And, in a more unusual request, it has also adapted one of the megaflo systems for use by British explorer Sir Ranulph Fiennes’ ‘Coldest Journey’ exhibition across Antarctica.
Commercial director Steve Rickards said: “We are looking at the catering and commercial market and we are moving into the solar renewables market and stealing little bits of market share from others. For us commercial is anything from small warehouses up to industrial estates. In terms of growth, I would expect that to be 5-6pc this year and next. However, what you have to balance that against is that we are currently building half the amount of units that we used to.”
The unvented market has seen considerable growth over the last 25 years, with consumer demand for powerful showers and fast-filling baths keeping sales buoyant. And the market was still seeing double figure annual growth in 2007 and into 2008, prior to the difficult economic climate and the subsequent reduction in construction projects.
But Mr Rickards said the firm did not want to rest on its laurels and the investment, which features automated computer-controlled welding equipment, reflected that.
“While Megaflo has been a successful, market-leading product for the past 25 years – so much so it is seen as the generic term for unvented water heating – it needs to keep improving and evolving to meet changing consumer require-ments, as well as forthcoming legislation,” he added. “We need to see volume growth in order to keep the people that we have got and improve on the numbers. We need to improve the levels of production. In the current climate that’s not going to happen in existing markets in the UK so we either have to look outside of the UK or markets that we don’t currently operate in.”
Heatrae Sadia, which won the sustainability award in last year’s EDP Business Awards, has been manufacturing water heating and heating products in Norwich since the company was established in 1920. The Megaflo brand itself was launched in 1987 and acquired by Heatrae Sadia in 1993. It has since remained the strong market leader in the unvented sector, despite increased competition.
The boss of Brandbank expects to accelerate the firm’s growth plans after it was bought out by the American consumer analysis company, Nielsen Holdings.