Uptec sofa makers

Rising from the ashes

accountancy client case study - Uptec logo
Tucked away at the end of country lane in the middle of the Cotswolds is a high end sofa manufacturer which boasts a client base including the likes of The Conran Shop, Heals and Liberty. Uptec is now an established business, but it hasn’t all been plain sailing. Paish Tooth has been instrumental in helping the company recover from a dire financial crisis which very nearly closed it down, and we are now supporting it along the road back to successful long term growth.

Who are Uptec?

Uptec were originally known as Upholstery Techniques. The business was started in 1985 by owner Phil Timings, who initially worked out of his dining room at home. Phil then rented space in a flour mill, before building the current Uptec factory, which was previously just farm buildings.

accountancy client case study - Uptec on sofa

Phil’s son Sam Timings started working at UpTec part-time during university, and then shortly after graduating began officially working with his dad, as was always the intention. Now the father and son team work together focusing on three main areas of the business – their direct sales via the showroom, their contract business with hotels, restaurants and interior designers and their retail business which comes from The Conran Shop, Heals and Liberty in London.

A sea change for the business

A few years ago events transpired which massively altered the shape and direction of the business. By the time Sam joined Uptec, Phil was working on the technical side of the business and had less focus on the office and the company finances. Paish Tooth’s director Patrick Cooper, who had been liaising with Phil for several years, soon noticed that the company finances had begun to be mismanaged and that cash was being haemorrhaged through all the wrong channels. Patrick made Phil aware of this, and of the serious impact it was having, and it soon became clear that the business would need to be restructured in order to have a future.

accountancy client case study - Sam & Paul Timings with Patrick Cooper

The other major upheaval for the business at this time was the last recession. When this hit it heavily impacted the retail industry, and affected in particular the London bubble which constituted so much of Uptec’s market. The whole industry was hugely affected, and even now it hasn’t yet totally recovered. This caused a very sticky situation for Uptec, as retailers were their only real customer base at the time. The company lost one of their major product lines, and turnover dropped by almost 50% overnight.

Taking control

As Uptec’s turnover rapidly nosedived, it was vital that a solution was found. At this point Sam stepped up to take over the management of the business, and provide a vehicle for keeping it alive. Sam recognised that regaining complete visibility of the company’s finances was his first priority, and he needed to get the right support in place to do this.

accountancy client case study - Sam & Paul Timings with Paul Cox

He began working closely with Paish Tooth’s Accounts Manager Paul Cox, and while Sam took a more prominent role in managing Uptec’s office, Paul and Patrick undertook a cost based reassessment and assisted with the necessary restructure of the business. The support Sam received from Paish Tooth allowed him to drill down and make Uptec’s finances more transparent and understandable. The result was that things started to became a lot more straightforward, and Sam could then focus on expanding the business.

“The key is having the confidence to be able to let someone else with the expertise take control and look after the situation, leaving you with the time to concentrate on what you do best.”

At the time Sam took over, Uptec were employing their own bookkeeper, who transferred the books on to Paish Tooth further down the line. Paul explained how software like Xero allows you to upload the relevant information directly and get the job done faster and with greater clarity. This has made a world of difference – Uptec no longer need to employ someone, as the combination of Xero and Paish Tooth now do it all for them.

accountancy client case study - Uptec & Paish Tooth

“Paish Tooth know exactly what’s going on, and it’s almost like having the work done in-house. Yes, it’s in their ‘house’, but it doesn’t feel outsourced because of the level of communication between us.”

Although Uptec didn’t lose any of their original customers during the recession it was the volume that disappeared, and these volumes still haven’t fully recovered. So the only option latterly has been to diversify and explore a totally different market. Previously Uptec did no contract work, and they had almost no direct sales. Now thanks to new customers such as restaurant chain D&D London, they are enjoying large volume orders again, whilst their newly designed showroom has increased sales from passing traffic visiting them on site.

Uptec – on the up

Since receiving Paish Tooth’s help in getting their finances straight and restructuring the business, Uptec has gone from strength to strength, turning their loss making business into a profitable one again.

“One of the main things that got us out of difficulties was a very close tie-up with Paish Tooth. The ongoing support from them has been crucial.”

As a result of restructuring the business, Uptec have enjoyed a 74.5% reduction in overheads and their net profit percentage is up by 32 percentage points. They have had the cash available to invest in a new showroom to drive sales to the public, and these sales have increased by 250%. In the third year since the restructure Uptec have now more than doubled their turnover compared to the first year. Sam is fully involved in the finances now, and finds Xero a fantastic means of monitoring the company’s progress.

accountancy client case study - Sam & Paul Timings

“I keep an eye on the balance sheets now, because it’s all there in Xero which is brilliant – it makes you more inclined to keep an eye on it because it’s so easy to do.”

Uptec’s long term vision is to focus on the contract side of the business, where they enjoy bulk buy volume purchases and much better margins. Their brand new website has two sections, one specifically for contract purchases and one for direct sales. They also have plans for further building developments in the factory, redesigning the sewing room and its surrounding areas. Yes, it’s safe to say the future’s now looking very bright for Uptec.