Telegraph Business Club Feature Pudsey Diamond Engineering

Telegraph Business Club Feature Pudsey Diamond Engineering

Engineer needs to think outside the box

Peter Diamond wants to design a varied and sustainable future for his company, Pudsey Diamond Engineering, writes Andrew Cave.

Peter Diamond has already shed staff at his 27-year-old engineering business, Pudsey Diamond Engineering. Income is down and margins are being squeezed. And Diamond, 53, who originally had plans to sell up in three years is now having to rewrite his retirement schedule on the back of an expected 30pc drop in business.

But what irks Diamond isn’t so much the current economic climate, as not knowing which way to turn to get out of it. “Don’t get me wrong,” says the former dockyard apprentice. “We are developing new products. But I wish someone could give me an idea of how long this recession will go on for. Will it take five years or 10? If it takes 10, a lot of companies will be gone.

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He’s not alone, of course, in wondering just when the recovery will start. And as a sector, engineering has been in difficult straits for some time. But that simply underlines Diamond’s view that without firms such as Pudsey Diamond Engineering, Britain will never return to its former levels of prosperity. Britain, he says, needs to start making things again.

“The UK has to be a high skilled economy,” he says. “Unless we are able to create wealth, or limit what’s coming in, then we won’t be able to afford the social services that we have.” Controlling imports is close to engineer Diamond’s heart. He’s worried that cheap imports are already undermining any attempt he may make to ensure his company’s recovery.

The main issue that Diamond has is that local authorities – his only customer - need to take into account the bigger picture when they spend public money. Too many, he says, are opting for the cheaper option and importing from the Far East without weighing up the associated cost to the country of doing so.

They may well be getting a cheaper product, he says, but if that means firms such as Pudsey Diamond end up laying off staff (last summer the company it had a staff of 60, including agency workers. Now it is down to 40) – then by factoring the cost of unemployment into the equation, the true bill to the taxpayer is considerably higher.

The Hampshire-based firm designs and makes the metal boxes and covers that go with street lighting. It’s not glamorous but it is essential. Councils across the UK and Ireland buy these by the bucket load, enough for Diamond to take the business to a £3m turnover. “We are very niche,” he says. “We are the biggest supplier of replacement lamppost doors.

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But competition from Chinese imports, the crash of the Irish economy - which accounted for £500,000 a year of business, and the inability to sell into new overseas markets due to differing lighting installation systems, means Diamond